They are visible and relatively easy to identify as a group of investors. They can be very sophisticated, with large technical and analytical resources. And their daily trading activity provides an important measure of liquidity in developing securities markets. But the overall success of privatisation in the Arab world will ultimately depend on the ability to tap into the region's private wealth. This pool of funds dwarfs the resources currently available from the dedicated international funds and institutions active in emerging markets.
Private investors are also more diverse and more entrepreneurial than domestic institutions.
This size and diversity mean that private investors ultimately provide the market depth necessary to build a long-term shareholder base in the Middle East. I would identify three broad groups. First, you have the employees of the privatised companies themselves. Second, the general public. While employee ownership achieves important social goals, and helps to align workers' objectives with those of management and shareholders, employee purchases do not provide a substantial source of new risk capital.