According to the sources, Saudi Arabia has surpassed China as the leading developing market issuer of international bonds, with $33.2 billion in bond sales to date. Due to an 8% increase in Saudi Arabia’s bond sales in 2024, Saudi Arabia has moved up from the top spot for the first time in 12 years.

The Vision 2030 strategy of the Kingdom, which seeks to diversify the Saudi economy away from oil dependence and turn the nation into a worldwide business hub by the end of the decade, is receiving more and more backing from international debt investors, which is driving the Kingdom’s record pace of borrowing. Chinese borrowers, on the other hand, are seeing a major change in their financing approaches. China’s international bond issuance has fallen to one of its lowest levels in recent years due to a surge in demand for bonds denominated in local currencies.

Apostolos Bantis, Managing Director of Fixed-Income Advice at Union Bancaire Privee, said in a press conference that sentiment toward Saudi bonds is “very healthy.” He continued, “Given its substantial funding needs for large infrastructure projects, it’s not surprising that the Kingdom has emerged as the largest issuer of EM bonds.”

Saudi Arabia is aggressively looking for alternate sources of finance in addition to increasing its bond issuance to cover an estimated $21 billion fiscal gap in 2024. In order to expedite the Vision 2030 efforts, the Kingdom anticipates that its overall funding activities for the year will come to approximately $37 billion. Reduced oil revenues from supply cuts and deficiencies in foreign direct investment are contributing factors to the significant shift towards the bond market.

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