Saudi Arabia moved further to develop its debt market, with the Saudi Capital Market Authority (CMA) announcing the cancellation of its share of trade commission on bond and sukuk issues this month.

This move will reduce costs for market participants, making bond issues more attractive to investors.

The CMA’s decision is expected to enhance liquidity and increase competitiveness in the local bond market, leading to the expansion of domestic investors’ base in government debt issues.

“With the cancellation decision, the CMA affirms its commitment to stimulating activities in the debt instruments secondary market, considering such commitments as long-term without exceptions,” SPA reported, citing the authority’s announcement.

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“This move aligns with the CMA’s strategic objective of developing the Sukuk and debt instruments market to boost its attractiveness to issuers and investors,” the report said.

The CMA hoped that its move would encourage issuers to list local currency-denominated Sukuk and bonds in the Saudi debt instruments market and investors to trade such instruments.

The market regulator’s decision also aligns with exemptions and changes in fees for debt instrument trades made over the last 14 years.

The Saudi Sukuk and debt instruments market has witnessed significant developments in recent years, including the increase of the face value of the government Sukuk from one million Saudi Riyals to SAR 1000 to boost trading rates in the market.

Additionally, Clearstream has been linked with Securities Depository Center Company (Edaa) internationally, and debt instruments trades have been made available for all foreign investors.