Saudi Arabia has announced plans to issue new sukuk valued at around 35.9 billion Saudi riyals ($9.57 billion) after completing the early purchase of a portion of the kingdom's outstanding debt worth a total of 35.7 billion riyals.
The outstanding debt instruments were maturing in 2024, 2025 and 2026, with the move representing the “largest early purchase transaction” arranged by the National Debt Management Center, it said on Sunday.
The NDMC said the new sukuk issuances would be done in four tranches with the first, amounting to about 7.5 billion riyals, maturing in 2031. The second, valued at roughly 14.5 billion riyals, is set to mature in 2032, with the third tranche, amounting to 10.8 billion riyals, maturing in 2033, and the fourth, valued at approximately 3.2 billion riyals, maturing in 2038.
The initiative is a “continuation of the NDMC's efforts to strengthen the domestic market and to keep up with market developments which have been reflected positively on the growing trading volume in the secondary market”, it said.
The move also enables the NDMC to “exercise its role in managing the government debt obligations and its future maturities”.
“This will also align the NDMC’s efforts with other initiatives to enhance public finance in the medium and long term,” it added.
Saudi Arabia, which generates the bulk of its revenue through the sale of hydrocarbons, is diversifying its funding base in line with its Vision 2030 economic agenda and its Fiscal Balance and Financial Sector Development programmes.
The country's economy, the biggest in the Arab world, grew by 1.1 per cent in the second quarter, boosted by a sharp expansion in the country’s non-oil sector as the kingdom pushes to diversify its economy away from hydrocarbons.
The non-oil sector grew 5.5 per cent in the three-month period to the end of June, compared with the same period in 2022, according to a flash estimate by the General Authority for Statistics.
The kingdom’s economy is forecast to grow by 1.9 per cent this year, largely a reflection of oil production cuts and lower crude prices, according to the International Monetary Fund.
Growth in the kingdom is expected to pick up to 2.8 per cent in 2024, the Washington-based fund said in its latest World Economic Outlook update.
Globally, sukuk issuance volumes are expected to reach between $160 billion and $170 billion in 2023, according to S&P Global Ratings.
“A ramp-up of local currency issuance in Saudi Arabia could change this picture, however, particularly because we expect oil prices to be lower for the remainder of the year,” it said in a report last month.
HSBC Saudi Arabia, AlRajhi Capital, SNB Capital and AlJazira Capital have been appointed as joint lead managers for the latest transaction, NDMC said.
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Fresh faces in UAE side
Khalifa Mubarak (24) An accomplished centre-back, the Al Nasr defender’s progress has been hampered in the past by injury. With not many options in central defence, he would bolster what can be a problem area.
Ali Salmeen (22) Has been superb at the heart of Al Wasl’s midfield these past two seasons, with the Dubai club flourishing under manager Rodolfo Arrubarrena. Would add workrate and composure to the centre of the park.
Mohammed Jamal (23) Enjoyed a stellar 2016/17 Arabian Gulf League campaign, proving integral to Al Jazira as the capital club sealed the championship for only a second time. A tenacious and disciplined central midfielder.
Khalfan Mubarak (22) One of the most exciting players in the UAE, the Al Jazira playmaker has been likened in style to Omar Abdulrahman. Has minimal international experience already, but there should be much more to come.
Jassim Yaqoub (20) Another incredibly exciting prospect, the Al Nasr winger is becoming a regular contributor at club level. Pacey, direct and with an eye for goal, he would provide the team’s attack an extra dimension.
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Planes grounded by coronavirus
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Indonesia's Lion Air: Suspending all flights to China from February
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Sole survivors
- Cecelia Crocker was on board Northwest Airlines Flight 255 in 1987 when it crashed in Detroit, killing 154 people, including her parents and brother. The plane had hit a light pole on take off
- George Lamson Jr, from Minnesota, was on a Galaxy Airlines flight that crashed in Reno in 1985, killing 68 people. His entire seat was launched out of the plane
- Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
- Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
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Indoor Cricket World Cup Dubai 2017
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