Saudi Arabia Political Forecast in 2017
Rapporteur_Hessam Karbasian: In this part of the report, we continue to discuss about the relations between the two countries (Iran & Saudi Arabia) and predictions of critics and writers in the field of politics and economics, about the future of relations between the two countries and particularly Saudi Arabia will refer potential future.
In reports from news sites such as Bloomberg, we can extract the points that critics and thinkers about the future of Saudi politics and economics have considered.
Bloomberg website pointing to rising costs of war against Yemen, Saudi Arabia, has been on the developments of 2017, the Saudi royal palace coup and a new member of the House of Saud in the country aside his deputy crown prince.
Bloomberg released most pessimistic scenarios about possible developments in the world in 2017 that parts of it are as follows:
Saudi Arabia laid out key elements of its borrowing plans for 2017 as the kingdom seeks to capitalize on investor demand for its debut sale this year to finance the budget deficit.
The world’s biggest oil exporter plans to raise between $10 billion and $15 billion from international bond markets, Mohammad Al Tuwaijri, secretary-general of the Finance Committee at the Royal Court, told Saudi-owned Al Arabiya television. Authorities will sell about 70 billion riyals ($18.7 billion) locally, he said.
Officials from Saudi Arabia have met with banks to discuss the potential sale of Shariah-compliant bonds in the first quarter, according to five people familiar with the matter. Saudi Arabia raised $17.5 billion in October in the biggest ever emerging-market bond sale, attracting $67 billion of bids, people familiar with the sale told Bloomberg at the time.
Finance Minister Mohammed Al-Jadaan told Bloomberg News on Thursday the country will “most likely” tap debt markets in the first quarter. “We will issue sukuk, but we will issue other instruments at the same time,” he said, declining to give more details. He said the timing will depend on the conditions of the markets. “We are very comfortable about our cash flow,” he said.
The kingdom is turning to debt markets to help fill one of the highest budget deficits in the Middle East after the slump in oil prices battered its revenue. Officials said on Thursday the shortfall will likely keep narrowing before possibly turning into a surplus by 2020.
The country is considering selling sukuk with different maturities to the five-, 10- and 30-year debt it sold in October, one of the people said, asking not to be identified as the information is private. This could include tenors of seven and 16 years, the person said. No final decisions on the size or timing have been made, the people said.
A 16-year sukuk “would be in exceptional demand from Shariah-compliant investors starved of long-duration investment alternatives,” said Emad Mostaque, a London-based strategist at Ecstrat, a consultancy advising on asset allocation between global equity markets.