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RIYADH: Global sukuk issuance is expected to fall to between $160 billion and $170 billion in 2022 from $181 billion in 2021, said global rating agency Moody’s.
Sukuk, which is also called an Islamic bond, is a debt product issued in accordance with Shariah or Islamic laws.
The drop is expected due to higher oil prices reducing the requirements of sukuk-issuing sovereigns and raised interest rates.
“The improved fiscal position of major sovereign issuers is the main reason for the expected drop in volumes this year,” said Ashraf Madani, VP-Senior Credit Officer at Moody’s.
Madani noted that rising oil prices are decreasing the Gulf Cooperation Council governments’ financing needs.
However, in the Southeast Asia lower government spending is anticipated because of a decline in pandemic-related expenditure, he added.
The global sukuk market saw a year-on-year decline of 10 percent to $92 billion in the first half of 2022.
Moody’s projects the value of issuance to reach between $70 billion and $80 billion in the year’s second half, as high interest rates continue to pressure sukuk activity.
Saudi Arabia, the GCC’s biggest sovereign issuer, has completed its issuance program for the year.
The Kingdom’s domestic market recorded $14.4 billion worth of sukuk sales this year, registering a growth of 185 percent over the last year, Bloomberg reported.
According to Moody’s, the risk of increasing interest rates will remain a challenge for the sukuk market.
Some issuers including corporates and financial institutions have delayed their sukuk offerings given the volatility of interest rates during the first half of 2022.
“We expect this situation to persist into the second half of the year as major central banks continue to raise rates to combat inflation,” the report highlighted.
That said, Moody’s mentioned that the sukuk market is becoming more appealing as an investment tool, as shown by the high demand for recent issuances.
The demand for sukuk is concentrated in international investors in markets that are less exposed to Islamic finance, the rating agency concluded.
RIYADH: Jeddah residents have the highest engagement in Saudi Arabia with websites offering fake prizes, according to an experiment conducted by the Kingdom’s Banks Media and Awareness Committee.
The organization created six websites that presented attractive offers targeting those who are interested in investments, education scholarships, competitions, prizes, travel, and tourism.
Some 44.2 percent of people in Jeddah exposed to the sites were duped and entered personal information.
Riyadh was next with 36.6 percent, then Dammam with 9.2 percent, and Al Madinah and Makkah.
Results of the study, conducted in cooperation with Saudi Federation for Cybersecurity Programming and Drones, indicate that offers related to prizes and competitions received the highest rate of visitors, with more than 71,000 visits.
This experiment was conducted from June 29 until July 16, with participation of Saudi banks.
RIYADH: As Saudi Arabia plans to build 200 smart cities, it has launched a new challenge called “SMARTATHON” with an aim to extend the usage of Artificial Intelligence in creating smarter, safer, and healthier cities.
“We today announce the launch of SMARTATHON, the smart cities challenge,” said Abdullah Al Ghamdi, head of Saudi Data and Artificial Intelligence Authority, during the Global AI Summit in Riyadh on Sept. 14.
This comes as Majid Al Hogail, minister of Municipal and Rural Affairs and Housing, revealed the plans to unveil a number of smart cities in the Kingdom in partnership with SDAIA.
Our dream is to have more than 200 smart cities in Saudi Arabia using AI, in areas of parking, special planning and the most important is the citizens’ engagement, and how that will improve the quality of service in our country,” Al Hogail stated.
The Global AI Summit, which runs from Sept. 13 to Sept. 15, is exploring the impact of AI on topics as crucial as economic mobility, health care, human capability development, and smart cities.
RIYADH: Google has reached an agreement with Saudi Arabia to help implement artificial intelligence sustainable solutions and cutting-edge technologies in the Kingdom.
The Authority for Data and Artificial Intelligence, in partnership with the global business, has established AI programs and initiatives for the Ministry of Environment, Water and Agriculture.
The agreement covers three programs and 11 initiatives, according to Mansour bin Hilal Al-Mushaiti, Saudi Arabia’s deputy minister of environment, water and agriculture.
Al-Mushaiti also announced the launch of an AI-based Earth Observation and Sciences Program aimed at addressing climate change risks and improving environmental protection in Saudi Arabia and beyond.
He said finding solutions would not be an easy task as food and water must be provided while the environment is preserved — the importance of balancing industrial growth and economic development with protecting the environment is equally crucial for the Kingdom’s future, led by Crown Prince Mohammed bin Salman.
“Artificial Intelligence will aid in accelerating multi-progress and achieving sustainability goals aligned with Vision 2030,” Al-Mushaiti said.
AI is also expected to contribute to the transformation of society, economy, and nation into a digital one.
“It is necessary to implement disruptive solutions that will enable us to depart from the old legacy and implement state-of-the-art technologies and deploy artificial intelligence when, where, and how needed,” he added.
RIYADH: Saudi Arabia’s Ministry of Finance has signed a number of financing agreements with several local banks, amounting to SR25 billion ($6.6 billion) to execute infrastructure projects by the National Debt Management Center.
The infrastructure projects are scheduled to start in 2023 and 2024, according to a statement.
In line with Saudi 2030 Vision, this comes as part of the ministry’s aim towards enabling and supporting strategic infrastructure projects.
RIYADH: Saudi banks will continue to stand strong despite rising interest rates globally, the CEO of one of the Kingdom’s biggest banks told Argaam.
Tony Cripps, head of the Saudi British Bank, known as SABB, sees a positive outlook for the Kingdom’s banking and overall economic growth.
According to the executive, Saudi banks are unlikely to witness pressures during the second half of 2022, unlike global peers who are suffering from the consequences of rising inflation.
He expects lending to be healthy in the coming period of 2022, as was the case in the first six months, adding that retail loans did not see a slowdown.
In a separate announcement, Cripps revealed SABB’s strategy for environmental, social, and governance as one of the main pillars of its 2025 strategy.
“As one of the largest financial institutions in the Kingdom, we are committed to supporting the government’s vision in its path to achieve this transformation, which will push companies to invest in technology, and grow their businesses with sustainability as the main driver,” he said.
Saudi-listed SABB recorded a 10 percent profit surge to SR2.1 billion ($559 million) for the year’s first half, largely due to a rise in operating income.
