Goldman Sachs: $ 145 billion worth of sovereign debt sales in...

CNBC Arabia
Goldman Sachs said that in light of the increased need for financing as a result of the Covid-19 pandemic, and the acceleration of countries classified in the category worthy of investment to issue bonds, this contributed to raising the sales of sovereign debt in emerging markets since the beginning of the year to 145 billion dollars, which is considered The highest level of the historical range.
He stressed that countries facing the risk of defaulting on their debts found it more difficult to enter the market, as was evidenced by the postponement of the Turkish sovereign investment fund and Naftogaz last month to sell bonds due to market volatility before the US presidential election and high borrowing costs.
The bank expected that the issuance of sovereign debt in emerging markets in 2021 would reach about $ 140 billion, which is approximately the same level this year, with a surge in sales of high-yield bonds to offset the impact of a slowdown in the issuance of the category worthy of investment.
He stated that his expectations to increase the issuance of high-yield bonds next year partly reflect his expectation of better prospects with an improvement in risk appetite that helps countries with high-risk debt.
The bank noted that the increase in debt maturities in 2021 indicates the net issuance is still relatively moderate, and it is expected that Saudi Arabia, Qatar, Egypt and Mexico will be the highest in terms of net issuances next year.
In contrast, it is not expected to sell dollar-denominated bonds from Hungary and Croatia, which have switched to financing themselves mainly from the euro or their local currencies, as well as countries that issue high-yield bonds, such as Sri Lanka and Oman, which is due, among other things, to the high risk of default.