Debt issuance will be strong in the Gulf states

Significance

Debt issuance has risen across the Gulf Cooperation Council (GCC), despite high global interest rates. Drivers include incentivising local capital market development and meeting ambitious economic development goals. Sovereign and quasi-sovereign debt is far larger than that of the private sector.

Impacts

• GCC debt capital market issuance is likely to continue to outstrip equity issuance.
• Much of the equity issuance will reflect balance sheet adjustments by regional sovereigns.
• Saudi Arabia’s debt levels will rise rapidly but will remain moderate compared with emerging and frontier markets.
• Kuwait could start to borrow on global capital markets if it passes a new debt law.