Saudi Arabia raises $12.5bn in new bond sale

The Kingdom is pursuing many economic and social reforms, and this week said it will end a ban on women driving. (Reuters)
Updated 29 September 2017
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Saudi Arabia raises $12.5bn in new bond sale

RIYADH: Saudi Arabia on Thursday announced it had undertaken another multibillion-dollar bond sale to finance a persistent budget deficit left by low oil prices.
The world’s top crude oil exporter raised $12.5 billion in its third international bond issue, the Finance Ministry said.
It comes as Saudi Arabia pursues economic and social reforms including this week’s announcement that it will end a ban on women driving.
The Kingdom has already undertaken three “sukuk” Islamic bond issues this year — including one international sale — totalling around $15 billion.
Last year it raised $17.5 billion in its first global bond issue — the largest ever by a single country. Previously it had sold domestic bonds.
The latest issue was heavily oversubscribed with orders worth $40 billion, according to the Finance Ministry.
A slump in global oil prices resulted in massive budget shortfalls in 2014.
Saudi Arabia has posted a budget deficit in each of the past three years and is headed for a fourth year in the red in 2017.
The Kingdom’s deficit topped $200 billion from 2014 to 2016, and it is forecast to post a $53 billion shortfall this year.
Riyadh has also withdrawn more than $230 billion from its fiscal reserves since the end of 2014 to finance the budget deficit. Its reserves now stand at just over $490 billion.
Economic growth in Saudi Arabia is expected to hit just 0.1 percent this year, the weakest since 2009, according to the International Monetary Fund.
The Kingdom is due to introduce its first value-added tax (VAT) in early 2018 and is preparing to sell just under five percent of energy giant Aramco next year.


Iran anti-money laundering law faces challenge as deadline looms

Updated 18 August 2018
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Iran anti-money laundering law faces challenge as deadline looms

  • Iran has been trying to implement standards set by the Financial Action Task Force
  • Foreign businesses say legislation that includes FATF guidelines is essential if they are to increase investment

DUBAI: A top Iranian constitutional body has demanded changes to anti-money laundering measures passed by parliament, state-run media said on Saturday, as Tehran nears a deadline to pass legislation to help it attract investment while facing USsanctions.
Iran has been trying to implement standards set by the Financial Action Task Force (FATF), an inter-governmental organization which underpins regimes combatting money laundering and terrorist financing. It hopes it will be removed from a blacklist that makes some foreign investors reluctant to deal with it.
In June, FATF said Iran had until October to complete the reforms or face consequences that could further deter investors from the country, which has already been hit by the return of US sanctions. {nL5N1UY39D]
Hard-liners in parliament have opposed legislation aimed at moving toward compliance with FATF standards, arguing it could hamper Iranian financial support for allies such as Lebanon’s Hezbollah, which the United States has classified as a terrorist organization.
The Guardian Council, which vets legislation passed by parliament for compliance with the constitution, objected to four items in the anti-money laundering amendments and returned the measure to parliament, spokesman Abbas Ali Kadkhodaei was quoted by the judiciary’s news agency Mizan as saying.
Kadkhodaei did not give details of the four items, according to Mizan.
Earlier this month, the Guardian Council approved legal amendments on combating the funding of terrorism.
Supreme Leader Ayatollah Ali Khamenei said in June parliament should pass legislation to combat money laundering according to its own criteria.
Foreign businesses say legislation that includes FATF guidelines is essential if they are to increase investment.