Saudi Arabia is considering selling as much as $15 billion in bonds this year in what would be the country’s first foray into international capital markets, people with knowledge of the matter said.
Encouraged by Qatar’s record issue last week, Saudi Arabia is weighing a sale of at least $10 billion in five-, 10- and 30- year bonds after Ramadan ends in July, the sources said. No final decision has been made, and the discussions are still at a preliminary stage, the sources said, asking not to be identified as the talks are private.
Governments in the six-nation Gulf Cooperation Council, which includes the two biggest Arab economies of Saudi Arabia and the United Arab Emirates, are turning to public markets after the plunge in oil prices punched holes in their budgets.
Saudi Arabia is undergoing an economic shakeup led by Deputy Crown Prince Mohammed bin Salman as it prepares for the post-oil era. One of the government’s biggest challenges will be navigating its worst economic slowdown since the global financial crisis. Authorities are cutting spending to plug a budget deficit that reached about 15 percent of gross domestic product in 2015.
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Qatar last week attracted $23 billion in orders for its $9 billion sale, the biggest ever from the Middle East. Abu Dhabi raised $5 billion from the sale of five- and 10-year securities in April, while Dubai is also said to be preparing an international bond sale this year.