JEDDAH: Finance Minister Ibrahim Al-Assaf said Monday that Saudi Arabia has no plans to issue sovereign bonds. “Government bonds are issued when there is a need for them. Thank God, lately there has been no need to issue bonds or sukuk,” he told Al Arabiya news channel.
Analysts have said that the Kingdom does not need to borrow as it has accumulated large reserves from crude exports. However, they pointed out that a sovereign bond would help the nascent Saudi market of bonds, both Islamic and conventional. With no sovereign bond to set a benchmark, secondary bond trading has been lackluster since the market’s launch in June. The trading platform is meant to provide firms alternative sources of funding to keep infrastructure projects running as the top oil exporter had earmarked more than $400 billion for such projects in its budget.
Meanwhile, the annual growth in Saudi Arabia’s M3 money supply fell for a fourth month in a row in August. The Saudi Arabian Monetary Agency’s website carried data showing money supply of SR994.7 billion in August compared to SR1.01 trillion in July.
