Home GCC Saudi Arabia Saudi Arabia won’t tap debt market again in 2020, minister says The world’s largest crude exporter is relying on more borrowing as it grapples with the impact of the twin economic shocks caused by oil market turmoil and the coronavirus pandemic by Bloomberg November 22, 2020 Saudi Arabia has no plans to tap international debt markets again this year as the kingdom leans on domestic borrowing to cover its budget deficit, Finance Minister Mohammed Al-Jadaan said. “We went to the local market significantly this year, we are likely to go to the market next year,” Al-Jadaan said in an interview with Bloomberg TV on Friday. “There are no plans currently for an international issuance.” The world’s largest crude exporter is relying on more borrowing as it grapples with the impact of the twin economic shocks caused by oil market turmoil and the coronavirus pandemic. But the kingdom covered nearly its entire budget deficit with domestic borrowing in the third quarter, even as its fiscal gap widened 27 per cent from a year earlier. It also borrowed SAR45bn more than needed from domestic lenders, and will use that over-financing to help plug the rest of the year’s deficit, the finance ministry said last month. That means the kingdom won’t need to tap international markets in the last few months of the year, as Morgan Stanley similarly predicted earlier. Al-Jadaan also said that he expects domestic spending by the sovereign wealth fund – the Public Investment Fund or PIF – to boost the local economy in the coming years. Saudi officials forecast that gross domestic product will grow 3.1 to 3.2 per cent in 2021, after contracting 3.8 per cent this year, he said. “PIF is looking at where is the most optimal investment they will have,” Al-Jadaan said. “There are significant opportunities locally, so they are targeting local investments, but they are still investing abroad.” Tags Debt Deficit domestic spending Financing Public Investment Fund Saudi Arabia 0 Comments You might also like UAE’s Julphar divests Zahrat Al Rawdah Pharmacies Will they or won’t they? Talk of Saudi cutting oil prices for Asia Saudi PIF signs MoUs with Japanese lender worth up to $51bn Saudi Arabia’s Hassana to back $2bn Brookfield Middle East fund