Saudi Arabia, UAE to Dominate Bond and Sukuk Issuances in 2025

The Gulf Cooperation Council (GCC) debt capital market is gearing up for a fresh wave of bond and sukuk issuances following a robust first half of 2025 and a seasonal lull in early August, according to Citi. “We had a phenomenal first half. The pipeline in the second half could be smaller, unless a drop in rates sparks a pre-funding strategy toward year-end, pulling transactions planned for early 2026 into November,” said Victor Mourad, Co-Head of CEEMEA Debt Financing at Citi. He attributed the August slowdown to heavy issuance volumes earlier in the year and a natural pause as issuers prepare to tap markets in the third quarter.

Saudi Arabia Leads GCC Issuance, UAE Gains Ground

Saudi Arabia maintained its lead in the GCC debt market during the first half of 2025, raising $47.93 billion through 71 issuances, according to data from Kuwait Financial Centre (Markaz). This represented a 20% year-on-year decline from H1 2024. The UAE secured the second spot, raising $24.03 billion via 69 issuances, marking a 22.2% YoY increase, while Qatar followed with $10 billion. Bahrain issued $5.62 billion, and Kuwait’s issuance value surged 48% to $3.39 billion. Oman recorded the lowest issuance value at $1.08 billion from six deals. The region’s performance has positioned it as a safe haven for investors. “The GCC was the first market to re-open the primary emerging market supply after the tariff volatility in April, a testament to its credit strengths,” Mourad said.

Corporate and Bank Issuances Drive Growth

Corporate issuances surged 67.7% YoY to $60.20 billion in the first six months of the year, with government-related corporations raising $11.2 billion. Sovereign issuance, however, fell 48.2% YoY to $31.85 billion. Banks in Saudi Arabia and the UAE were active players, with several debut and refinancing transactions. “Saudi banks that had never issued bank capital in the past tapped the market in the first half for debut AT1 and Tier 2 transactions,” Mourad said. “This trend will continue, especially as additional call dates approach in 2026.”

Strong Appetite for Debut Issuers

Investor demand for debut issuers remains high. Mourad highlighted the “highly successful” $1.25 billion sukuk debut by Saudi mining giant Ma’aden in February, which attracted global investor interest. Even lower-rated issuers, particularly in real estate, have been able to secure attractive funding terms, supported by strong regional property market fundamentals.

Citi Expects Even Issuance Distribution Ahead

Citi has priced 41 tranches in MENA this year, including landmark deals for Saudi Aramco, Saudi and Qatari sovereigns, and Egypt. Mourad expects a steady supply from corporates, sovereigns, and banks in the months ahead, with an emphasis on private-sector participation to diversify the issuer base. “With record-tight spreads, transactions will need to be positioned on a relative-value basis against other tighter regions,” Mourad said, signaling that competition for investor capital is intensifying.