The new Public Debt Law enabling the UAE to issue sovereign bonds will help to deepen the capital markets in the second-biggest Arabian Gulf economy, enabling the country to tap a wider pool of financing options and creating a government yield curve to bolster secondary debt market in the UAE.
“The debt law represents a further fillip to the UAE’s plans to deepen the breadth of the financial and debt capital markets,” said Ehsan Khoman, the head of Middle East and North Africa research and strategy at the Japanese MUFG Bank. “The bonds [issued under the new law] will act as a central mechanism in the creation of a government yield curve in the secondary debt market.”
The UAE on Saturday issued the law permitting the Federal Government to sell sovereign debt for the first time, a move that will boost banking liquidity and enable individual emirates - which currently issue debt at the state level - to benefit from higher issuer ratings than they could achieve on their own, said Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai and Minister of Finance, in a statement from the Ministry of Finance.
Emirates in the UAE, including Abu Dhabi, Sharjah, Dubai and the Ras Al Khaimah, in the past have tapped the debt capital markets to fund growth and bridge fiscal gaps. However, the UAE, unlike its GCC peers including Saudi Arabia, Oman, Bahrain and Kuwait, has not issued sovereign debt in the absence of a debt law.
With the new regulations in place, the country can now approach fixed-income investors to sell bonds, both conventional and Sharia-compliant, giving it a diverse pool of global investors.
“It’s standardising according to the mature economies and it is a step in the right direction. For example, the US has its own sovereign bonds and its individual states also issue bond separately,” said a Dubai-based treasurer at an international lender.
"It is not really similar to the what you have in the other parts of the GCC as Saudi Arabia, for example, is one state and so are the other Gulf countries. Only the UAE is a confederation [in the GCC] where states were issuing their own bonds but the Federal Government wasn’t issuing any,” he said.
Although there is not much of a different between the yields on the bonds issued by some of the smaller emirates to those issued by the Abu Dhabi Government, the new law will “change the market dynamic and some of the individual emirates will get better ratings now”, the banker noted.
The UAE, does not need to issue federal debt at present – its consolidated fiscal deficit, including each of the seven emirates of Sharjah, Abu Dhabi, Dubai, Fujairah, Ajman, Umm Al Quwain and Ras Al Khaimah, is forecast to remain stable at around 1.6 per cent of gross domestic product this year, according to the International Monetary Fund.
However, the UAE may choose to sell federal bonds in the coming months if conditions are favourable, to kick-start the development of a secondary bond trading market.
“Whilst the UAE’s fiscal finances are in-check, with the fiscal position expected to return to surplus this year, this announcement will provide another lever of funding for the Federal Government from a diversified financing strategy perspective,” Mr Khoman said.
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The new regulations will allow UAE banks to purchase government bonds in dirhams or foreign currencies, which will help them comply with international Basel III requirements, the Ministry of Finance said.
It will “provide support for the Central Bank of the UAE to enhance its liquidity management in the banking sector", Mr Khoman added.
It is not known when the debt law, which has been in the pipeline for several years, will go into effect but, once in place, it will allow the establishment of a Public Debt Management Office (PDMO) that will work under the Ministry of Finance to monitor and evaluate the risks of borrowing and trading public debt, and suggest appropriate solutions.
The PDMO will work with the UAE Central Bank in formulating short and long-term public debt management strategies and issuing government bonds, treasury bills and other instruments, the ministry said.
The debt office will also work with the governments in each of the emirates to develop a primary and secondary financial market as each local government sets up its own public debt office as public debt instruments are issued at the emirate level.
The fall in oil prices from the mid-2014 peak of $115 per barrel to less than $30 per barrel in the first quarter of 2016 had forced the governments in the Gulf - which accounts for about a third of the world’s proven oil reserves - to sell debt in a bid to plug their budget deficits.
The rise of crude prices to more than $80 per barrel in recent weeks has helped the Gulf states, which still heavily count on hydrocarbons proceeds for revenues, but sovereign debt as a financing tool will remain in play, according to an Oliver Wyman report released on Sunday. Although many countries were slow to set up debt management offices, the global consultancy argued that “robust management” of debt should now be a priority.
“With suppressed oil prices over recent years, sovereign debt is becoming an increasingly common financing tool in the region and it is here to stay," said Paul Calvey, a financial services partner at Oliver Wyman. "At present, debt managers and governments are still in the early stages of taking action to ensure they are set up to manage national financial stability in the future."
Beyond the need for improved debt management practices, governments must start to cultivate and develop their local bond markets to further diversify funding options and maintaining a sovereign yield curve, according to the report.
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Price: From Dh2,099
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Emergency
Director: Kangana Ranaut
Stars: Kangana Ranaut, Anupam Kher, Shreyas Talpade, Milind Soman, Mahima Chaudhry
Rating: 2/5
The rules of the road keeping cyclists safe
Cyclists must wear a helmet, arm and knee pads
Have a white front-light and a back red-light on their bike
They must place a number plate with reflective light to the back of the bike to alert road-users
Avoid carrying weights that could cause the bike to lose balance
They must cycle on designated lanes and areas and ride safe on pavements to avoid bumping into pedestrians
In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
Specs
Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request
How to join and use Abu Dhabi’s public libraries
• There are six libraries in Abu Dhabi emirate run by the Department of Culture and Tourism, including one in Al Ain and Al Dhafra.
• Libraries are free to visit and visitors can consult books, use online resources and study there. Most are open from 8am to 8pm on weekdays, closed on Fridays and have variable hours on Saturdays, except for Qasr Al Watan which is open from 10am to 8pm every day.
• In order to borrow books, visitors must join the service by providing a passport photograph, Emirates ID and a refundable deposit of Dh400. Members can borrow five books for three weeks, all of which are renewable up to two times online.
• If users do not wish to pay the fee, they can still use the library’s electronic resources for free by simply registering on the website. Once registered, a username and password is provided, allowing remote access.
• For more information visit the library network's website.
Company%20Profile
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COMPANY%20PROFILE
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The Written World: How Literature Shaped History
Martin Puchner
Granta
Volvo ES90 Specs
Engine: Electric single motor (96kW), twin motor (106kW) and twin motor performance (106kW)
Power: 333hp, 449hp, 680hp
Torque: 480Nm, 670Nm, 870Nm
On sale: Later in 2025 or early 2026, depending on region
Price: Exact regional pricing TBA
Ferrari
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Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
THE%20SPECS
%3Cp%3EEngine%3A%204.4-litre%20twin-turbo%20V8%20hybrid%0D%3Cbr%3EPower%3A%20653hp%20at%205%2C400rpm%0D%3Cbr%3ETorque%3A%20800Nm%20at%201%2C600-5%2C000rpm%0D%3Cbr%3ETransmission%3A%208-speed%20auto%0D%3Cbr%3E0-100kph%20in%204.3sec%0D%3Cbr%3ETop%20speed%20250kph%0D%3Cbr%3EFuel%20consumption%3A%20NA%0D%3Cbr%3EOn%20sale%3A%20Q2%202023%0D%3Cbr%3EPrice%3A%20From%20Dh750%2C000%0D%3Cbr%3E%3C%2Fp%3E%0A
The biog
Favourite pet: cats. She has two: Eva and Bito
Favourite city: Cape Town, South Africa
Hobby: Running. "I like to think I’m artsy but I’m not".
Favourite move: Romantic comedies, specifically Return to me. "I cry every time".
Favourite spot in Abu Dhabi: Saadiyat beach
The biog
Name: Sarah Al Senaani
Age: 35
Martial status: Married with three children - aged 8, 6 and 2
Education: Masters of arts in cultural communication and tourism
Favourite movie: Captain Corelli’s Mandolin
Favourite hobbies: Art and horseback ridding
Occupation: Communication specialist at a government agency and the owner of Atelier
Favourite cuisine: Definitely Emirati - harees is my favourite dish
The specs
AT4 Ultimate, as tested
Engine: 6.2-litre V8
Power: 420hp
Torque: 623Nm
Transmission: 10-speed automatic
Price: From Dh330,800 (Elevation: Dh236,400; AT4: Dh286,800; Denali: Dh345,800)
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Anghami
Started: December 2011
Co-founders: Elie Habib, Eddy Maroun
Based: Beirut and Dubai
Sector: Entertainment
Size: 85 employees
Stage: Series C
Investors: MEVP, du, Mobily, MBC, Samena Capital
Employment lawyer Meriel Schindler of Withers Worldwide shares her tips on achieving equal pay
Do your homework
Make sure that you are being offered a fair salary. There is lots of industry data available, and you can always talk to people who have come out of the organisation. Where I see people coming a cropper is where they haven’t done their homework.
Don’t be afraid to negotiate
It’s quite standard to negotiate if you think an offer is on the low side. The job is unlikely to be withdrawn if you ask for money, and if that did happen I’d question whether you want to work for an employer who is so hypersensitive.
Know your worth
Women tend to be a bit more reticent to talk about their achievements. In my experience they need to have more confidence in their own abilities – men will big up what they’ve done to get a pay rise, and to compete women need to turn up the volume.
Work together
If you suspect men in your organisation are being paid more, look your boss in the eye and say, “I want you to assure me that I’m paid equivalent to my peers”. If you’re not getting a straight answer, talk to your peer group and consider taking direct action to fix inequality.
NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
COMPANY PROFILE
Name: Qyubic
Started: October 2023
Founder: Namrata Raina
Based: Dubai
Sector: E-commerce
Current number of staff: 10
Investment stage: Pre-seed
Initial investment: Undisclosed
RESULT
Everton 2 Huddersfield Town 0
Everton: Sigurdsson (47'), Calvert-Lewin (73')
Man of the Match: Dominic Calvert-Lewin (Everton)
