GCC debt issuance hit record $70bn in 2017

DUBAI / Emirates Business

A buoyant GCC Bond and Sukuk market achieved an all-time high issuance of $70 billion in 2017, with sustained investor appetite expected in 2018, according to a co-authored white paper from Emirates NBD Asset Management (Dubai) and Fisch Asset Management (Zurich). The paper, titled “The GCC Fixed Income Market: Then
and Now” identifies key themes in 2017 and provides an outlook for the market in 2018.
The white paper considers a series of landmark events, which had a dir-ect impact on regional debt markets and are considered likely to shape them in 2018.
These include increased debtissuance despite elevated geopolitical instability and a spate of sovereign rating downgrades; and emerging fears among investors that higher oil prices may blunt governments’ commitment to economic reform.
Usman Ahmed, Head of Investments at Emirates NBD Asset Management, said: “Emerging market fixed income ended 2017 on a strong note and the positive sentiment has carried over into 2018.”
“We expect growth of the GCC’s debt investor base to continue in 2018, with demand coming from the record inflows to emerging markets and supply provided by the very real diversification needs of the region. The GCC remains a solid value proposition for debt investors, with credit spreads attractive given current and projected credit fundamentals.”