Saudi Arabia and China sign currency swap agreement worth $6.9bn

Saudi Arabia and China sign currency swap agreement worth $6.9bn
Saudi Arabia and China sign currency swap agreement worth $6.9bn

Thank you for reading the news about Saudi Arabia and China sign currency swap agreement worth $6.9bn and now with the details

Jeddah - Yasmine El Tohamy - RIYADH: Sustainable issuances in the Gulf, particularly bonds, are expected to gain prominence due to the upcoming UN climate change conference, or COP28, according to Fitch Ratings.

Bashar Al-Natoor, global head of Islamic finance and managing director at Fitch Ratings, highlighted the international event’s role in increasing awareness of sustainability issues in the region and directing investments and financial strategies toward a more environmentally responsible approach.

With 51 percent of sustainable issuances in the Gulf region taking the form of bonds, he said there is intense anticipation that they will significantly benefit from the heightened awareness fostered by COP28.

Al-Natoor underscored the substantial growth of environmental, social, and governance, or ESG, bonds in the UAE, reaching $6.4 billion by the third quarter of 2023, reflecting a 41 percent increase from the previous quarter’s $4.5 billion.

He emphasized that sustainable bonds in the UAE now constitute over 19 percent of the global ESG bond market, making up more than 30 percent of such bonds classified by Fitch Ratings.

During the third quarter, the UAE emerged as the leading global issuer of sustainable bonds, contributing $1.8 billion, accounting for about 80 percent of the worldwide total of $2.3 billion. 

Islamic finance in the UAE is also poised to benefit from COP28, as Shariah-based financing accounted for around 29 percent of the total banking sector funding in 2022. 

He indicated that all sustainable issuances assessed by Fitch in the UAE fell under the “investment grade” category, with about 35 percent held by financial institutions, 25 percent by infrastructure companies projects and 38 percent by other sectors.

Al-Natoor highlighted the absence of governmental sukuk issuances within this framework and expected them to surge in the UAE once the public sector entered this space.

The Fitch executive also emphasized the absence of governmental sukuk issuances within this framework but expressed anticipation of a significant leap in sustainable offerings in the UAE once the government enters this space.

He noted that green issuances globally constituted about 45 percent of the total ESG offerings during the third quarter of 2023.

Explaining the classification of Sukuk, he stated that green sukuk represents a branch of ESG issuances encompassing green, blue, social, or sustainable offerings, depending on the project’s intended impact.

He highlighted the significant growth of globally established ESG sukuk, which expanded by 66 percent annually to reach $33.3 billion in the final quarter of 2023.  

Notably, 67.2 percent of these sukuk are in hard currency, primarily US dollars.

Al-Natoor further highlighted that out of the total sukuk assessed by Fitch, approximately 13 percent are categorized as sustainable.  

Fitch has evaluated over 80 percent of global ESG issuances in hard currency. 

It categorized over 83 percent of global sukuk in hard currency related to environmental, social, and governance, totaling $18.9 billion. Notably, 98 percent of these sukuk are investment grade, representing the highest rating.

Saudi Arabia holds the highest share of established ESG sukuk issuances classified by Fitch, with 48.1 percent, followed by the UAE, Indonesia and Turkiye.

These were the details of the news Saudi Arabia and China sign currency swap agreement worth $6.9bn for this day. We hope that we have succeeded by giving you the full details and information. To follow all our news, you can subscribe to the alerts system or to one of our different systems to provide you with all that is new.

It is also worth noting that the original news has been published and is available at Arab News and the editorial team at AlKhaleej Today has confirmed it and it has been modified, and it may have been completely transferred or quoted from it and you can read and follow this news from its main source.

NEXT Saudi Aramco sets LPG contract prices for December

Author Information

I am Joshua Kelly and I focus on breaking news stories and ensuring we (“Al-KhaleejToday.NET”) offer timely reporting on some of the most recent stories released through market wires about “Services” sector. I have formerly spent over 3 years as a trader in U.S. Stock Market and is now semi-stepped down. I work on a full time basis for Al-KhaleejToday.NET specializing in quicker moving active shares with a short term view on investment opportunities and trends. Address: 838 Emily Drive Hampton, SC 29924, USA Phone: (+1) 803-887-5567 Email: [email protected]