Saudi issues new Islamic bond to finance budget

Saudi Arabia said it has completed the issuance of a new Islamic sukuk sale to help finance its budget deficit as the Kingdom accelerates borrowing despite rising oil prices. (AFP)
Updated 25 April 2018
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Saudi issues new Islamic bond to finance budget

RIYADH: Saudi Arabia said Tuesday it has completed the issuance of a new sukuk sale to help finance its budget deficit as the Kingdom accelerates borrowing despite rising oil prices.
The finance ministry’s debt management office said it raised $1.3 billion from the sale of sukuks in three tranches maturing in five, seven and 10 years.
This was the second sukuk sale this year following a $4.8-billion issue it completed last month.
Last week, the Kingdom also raised $11 billion in the sale of conventional bonds. In early March, it struck a deal to refinance a $10-billion loan and added another $6 billion to it.
The OPEC exporter has posted huge budget deficits since oil prices crashed about four years ago and resorted to the debt market to finance the shortfall.
It posted budget deficits totalling $260 billion since 2014 and is projecting a shortfall of $52 billion for this year, according to official figures.
The government debt level, both domestic and international, rose from 1.6 percent of gross domestic product in 2014 to 17.3 of GDP last year reaching $118 billion.
During the same period, the government has drawn down some $245 billion from its fiscal reserves.
Oil income made up more than 90 percent of public revenues before oil began to slide.


Saudi Arabia and Spain’s Navantia plan combat management systems venture

Updated 18 February 2019
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Saudi Arabia and Spain’s Navantia plan combat management systems venture

  • The SANNI venture will integrate and adapt Navantia’s combat management systems for Saudi navy corvette ships

ABU DHABI: State-owned Saudi Arabian Military Industries (SAMI) signed an agreement on Monday with Spanish state-held shipbuilder Navantia to set up a joint venture to provide combat systems, the new partnership’s chief executive said on Monday.
The SANNI venture, the name of which stands for SAMI Navantia Naval Industries, will integrate and adapt Navantia’s combat management systems for Saudi navy corvette ships, said Antonio Barberan at the IDEX military exhibition in Abu Dhabi.
SANNI is also in talks with other potential customers in the Middle East, he said.
SAMI owns 51 percent of SANNI, with Navantia holding the remaining 49 percent.
In November SAMI and Navantia signed an agreement to jointly manufacture five corvettes for the Saudi navy.