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Subject: answer to this two posts

short replay is great

first one :

Saudi Debt Market

The Saudi Arabian government commitment bits of the pie the lacks of many creating business areas to the extent commitment scattering and auxiliary market liquidity. During the latest decade, SAMA and banks commonly endeavored to perceive factors holding up be tended to. From the outset, the consideration was on augmenting the extent of instruments similar to coupon characteristics and improvements, followed by making a sizeable volume of extraordinary commitment in a lone issue through “tap issues”. Assessing of issues experienced formative changes to reflect the market components. The state of affairs, the instrument arrangement appears to have the features required for discretionary market trading. Regardless, the scattering issue holds up traffic of discretionary market liquidity. Plainly, the meager theorist base, vulnerable presentation, the nonappearance of adventure banks and SAMA’s uninvolved part in open market undertakings have not been helpful to assistant market trading. Any discussion of corporate protections now may be inopportune before the relevant concerns/necessities affecting government protections are adequately tended to.

How active is the Saudi Debt Market?

The presence of helpful optional business regions for government protections underpins the suitable dispatching of new issues. Different focal points of duty the board, for example, smoothing security regard enhancements and confining the effect of recovery divides, may comparatively be enabled if open market works out/mediations can be facilitated in well working optional business zones. Saudi Arabia experiences a frail optional market. We would express, the deficiency of the associate market is an impression of a tight scholar base, a transient undertaking society and the nonattendance of hypothesis banks. The improvement in Saudi Arabia’s essential market size isn’t an impression of a fluid assistant market yet has to do with the receptiveness of adequate detainee wellsprings of assets.

What are the prospects of Debt Market in Saudi Arabia?

This goal administers covering the public force’s gross getting necessities and guaranteeing its proceeded with enlistment to money related business territories. Net getting basics may contain financing an opening among use and pay in a given period and besides necessities for restricting making responsibility. Saudi Arabia’s getting necessities have stayed confined to financing spending need or perhaps restricting making responsibility from nearby sources. There is a huge piece of collection in the red instruments offered to the market as T-bills, GDBs and FRNs. Duty the heads has not been utilized to help cash related course of action, for example, by giving greater promise to wipe up abundance liquidity. Nor has new money getting been utilized to support the nation’s new trade holds.

second one :

comment on the Saudi debt market. How active is the Saudi debt market? What are the prospects for the debt market in Saudi Arabia?

The market, which is designated for trading “bonds and sukuk” on the Saudi Stock Exchange, witnessed transactions amounting to 11.2 billion riyals during the past month alone, which is the highest monthly in more than ten years.

Saudi Arabia may now hold the record as the fastest sovereign Sukuk issuer in the history Islamic debt capital market, Debt sales are expected to continue being a key source to finance soaring budgetary expenditure in order to ensure long-term fiscal health as well as economic growth.higher fiscal deficit is just one of the fundamental factors driving issuance of international bonds by Saudi Arabia. low oil prices remain the other significant pull factors for the Kingdom to tap the overseas bond market.

The development of the local debt instruments market is one of the initiatives of the financial sector development program in the Kingdom, which falls within its strategy to diversify sources of financing through sovereign debt issuances, as the government aims – through adopting the public debt strategy and issuing government debt instruments – to finance strategic infrastructure projects. And support for investments in service sectors and vital projects, and to support the budget in addition to developing the financial market.

Trading government debt instruments will contribute to supporting the budget, as well as facilitating access to large capitals in the market and increasing liquidity in it, as the inclusion of government debt instruments in Tadawul will stimulate investors to inject financial liquidity that enhances the depth of the Saudi financial market.

The inclusion of government debt instruments achieves many advantages, including expanding the investor base and diversifying their segments to invest in government debt instruments instead of limiting investment to local banks and government institutions, providing the opportunity for investors of all kinds to invest in government debt instruments and diversifying their investment sources, estimating the issue price and knowing an appropriate extent. Its price, and the ability to easily and quickly buy and sell debt instruments.

Reference:

https://www.mof.gov.sa/mediacenter/news/Pages/news…

https://www.mof.gov.sa/mediacenter/news/Pages/news…