Lower hydrocarbon prices have created challenges across the region but also opportunities. One of these is an accelerated evolution of regional debt capital markets. Since 2016, virtually all of the GCC sovereigns have raised funds in international markets, first via syndicated loans and now consistently on capital markets. As a result the Middle East is now firmly on the global map of emerging market issuance centres.
The region contributed over 14 per cent of the total emerging market capital market issuance in 2016, including the largest single issue ever, a US$17.5 billion mega bond issue by Saudi Arabia. There may not be quite the same volume this year, but the significant point is that GCC bonds and sukuk have arrived on the world stage in a big way.
But government issuance is about much more than raising funds. By drawing attention to the region and allowing investors to price country risk, the states have invested in a valuable piece of virtual national infrastructure, their own yield curves – against which GCC companies can price their own instruments in the market.
There is also an increasing recognition that while international markets can offer large funding volumes, they may shut down from time to time for reasons unrelated to our region. That is one reason why a savvy new breed of debt managers is paying attention to developing local currency markets. Robust local government markets create risk-free yield curves that deepen the financial market, which in turn enhances the credit profile of the GCC states and sendsa reassuring signal to the global financial community.
While there is no one size fits all policy for local government debt markets, there are some good practices.
Markets thrive when governments issue simple instruments at a true market-clearing price consistently and across the time horizon. International investors bring liquidity when that may be lacking locally. When there is consistency and size in the primary market, then a secondary market can develop.
Companies and projects are also increasingly opting for capital markets sometimes at the expense of syndicated lending, long considered less expensive and easier to access.
A lot of positive externalities come with this. Companies can achieve longer tenors and benefit from the rigours of the capital market experience, involving prospectus disclosure, due diligence and investor meetings all aimed at achieving better pricing.
And preparing for disclosure may prompt constructive changes in management and governance that promote the long-term interests of the company and its stakeholders.
The Gulf Bond and Sukuk Association and its members are working on innovations to take the market to a higher level such as securitisation, hybrid sukuk, green bonds, new sukuk indexes and strengthening the institutional investor base by promoting pensions and insurance reforms.
Regional regulators for their part are extremely positive on the market and are engaged in making it more attractive for companies and projects to access the market.
New and upcoming regulations will reduce administrative burdens, lower costs, streamline approvals and provide more flexibility for issuers. Meanwhile, welcome improvements in bankruptcy legislation, long-awaited, are appearing.
All of this will help to facilitate the investments needed in everything from water and power to transportation to soft infrastructure such as schools and health facilities to keep the region’s economy humming and transitioning to a post-oil future.
Michael Grifferty is president of The Gulf Bond and Sukuk Association
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Company%20Profile
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COMPANY PROFILE
● Company: Bidzi
● Started: 2024
● Founders: Akshay Dosaj and Asif Rashid
● Based: Dubai, UAE
● Industry: M&A
● Funding size: Bootstrapped
● No of employees: Nine
Tree of Hell
Starring: Raed Zeno, Hadi Awada, Dr Mohammad Abdalla
Director: Raed Zeno
Rating: 4/5
Company%20Profile
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COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
Company%20profile
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Paltan
Producer: JP Films, Zee Studios
Director: JP Dutta
Cast: Jackie Shroff, Sonu Sood, Arjun Rampal, Siddhanth Kapoor, Luv Sinha and Harshvardhan Rane
Rating: 2/5
Milestones on the road to union
1970
October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar.
December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.
1971
March 1: Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.
July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.
July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.
August 6: The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.
August 15: Bahrain becomes independent.
September 3: Qatar becomes independent.
November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.
November 29: At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.
November 30: Despite a power sharing agreement, Tehran takes full control of Abu Musa.
November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties
December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.
December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.
December 9: UAE joins the United Nations.
MATCH INFO
Uefa Champions League semi-final, second leg
Roma 4
Milner (15' OG), Dzeko (52'), Nainggolan (86', 90 4')
Liverpool 2
Mane (9'), Wijnaldum (25')
THE SPECS
Engine: 1.5-litre, four-cylinder turbo
Transmission: seven-speed dual clutch automatic
Power: 169bhp
Torque: 250Nm
Price: Dh54,500
On sale: now
Thank You for Banking with Us
Director: Laila Abbas
Starring: Yasmine Al Massri, Clara Khoury, Kamel El Basha, Ashraf Barhoum
Rating: 4/5
The specs
Engine: Dual 180kW and 300kW front and rear motors
Power: 480kW
Torque: 850Nm
Transmission: Single-speed automatic
Price: From Dh359,900 ($98,000)
On sale: Now
RESULTS
5pm: Sheikh Mansour bin Zayed Al Nahyan Racing Festival Purebred Arabian Cup Conditions (PA) Dh 200,000 (Turf) 1,600m
Winner: Hameem, Adrie de Vries (jockey), Abdallah Al Hammadi (trainer)
5.30pm: Sheikha Fatima bint Mubarak Cup Conditions (PA) Dh 200,000 (T) 1,600m
Winner: Winked, Connor Beasley, Abdallah Al Hammadi
6pm: Sheikh Sultan bin Zayed Al Nahyan National Day Cup Listed (TB) Dh 380,000 (T) 1,600m
Winner: Boerhan, Ryan Curatolo, Nicholas Bachalard
6.30pm: Sheikh Sultan bin Zayed Al Nahyan National Day Group 3 (PA) Dh 500,000 (T) 1,600m
Winner: AF Alwajel, Tadhg O’Shea, Ernst Oertel
7pm: Sheikh Sultan bin Zayed Al Nahyan National Day Jewel Crown Group 1 (PA) Dh 5,000,000 (T) 2,200m
Winner: Messi, Pat Dobbs, Timo Keersmaekers
7.30pm: Sheikh Mansour bin Zayed Al Nahyan Racing Festival Handicap (PA) Dh 150,000 (T) 1,400m
Winner: Harrab, Ryan Curatolo, Jean de Roualle
8pm: Wathba Stallions Cup Handicap (PA) Dh 100,000 (T) 1,400m
Winner: AF Alareeq, Connor Beasley, Ahmed Al Mehairbi
Gulf rugby
Who’s won what so far in 2018/19
Western Clubs Champions League: Bahrain
Dubai Rugby Sevens: Dubai Hurricanes
West Asia Premiership: Bahrain
What’s left
UAE Conference
March 22, play-offs:
Dubai Hurricanes II v Al Ain Amblers, Jebel Ali Dragons II v Dubai Tigers
March 29, final
UAE Premiership
March 22, play-offs:
Dubai Exiles v Jebel Ali Dragons, Abu Dhabi Harlequins v Dubai Hurricanes
March 29, final
COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
Springtime in a Broken Mirror,
Mario Benedetti, Penguin Modern Classics
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SPECS
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Learn more about Qasr Al Hosn
In 2013, The National's History Project went beyond the walls to see what life was like living in Abu Dhabi's fabled fort:
Match info
Costa Rica 0
Serbia 1
Kolarov (56')
Drishyam 2
Directed by: Jeethu Joseph
Starring: Mohanlal, Meena, Ansiba, Murali Gopy
Rating: 4 stars
The specs
The specs: 2019 Audi Q8
Price, base: Dh315,000
Engine: 3.0-litre turbocharged V6
Gearbox: Eight-speed automatic
Power: 340hp @ 3,500rpm
Torque: 500Nm @ 2,250rpm
Fuel economy, combined: 6.7L / 100km
Joker: Folie a Deux
Starring: Joaquin Phoenix, Lady Gaga, Brendan Gleeson
Director: Todd Phillips
Rating: 2/5
Cricket World Cup League 2
UAE squad
Rahul Chopra (captain), Aayan Afzal Khan, Ali Naseer, Aryansh Sharma, Basil Hameed, Dhruv Parashar, Junaid Siddique, Muhammad Farooq, Muhammad Jawadullah, Muhammad Waseem, Omid Rahman, Rahul Bhatia, Tanish Suri, Vishnu Sukumaran, Vriitya Aravind
Fixtures
Friday, November 1 – Oman v UAE
Sunday, November 3 – UAE v Netherlands
Thursday, November 7 – UAE v Oman
Saturday, November 9 – Netherlands v UAE
COMPANY%20PROFILE
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The burning issue
The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE.
Read part four: an affection for classic cars lives on
Read part three: the age of the electric vehicle begins
Read part one: how cars came to the UAE
