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Umm Al Quwain Launches Sustainable Blue Economy Strategy

Sheikh Mohammed bin Rashid Al Maktoum attends the launch of Umm Al Quwain's Blue Economy Strategy at the World Government Summit 2022 (Asharq Al-Awsat)
Sheikh Mohammed bin Rashid Al Maktoum attends the launch of Umm Al Quwain's Blue Economy Strategy at the World Government Summit 2022 (Asharq Al-Awsat)
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Umm Al Quwain Launches Sustainable Blue Economy Strategy

Sheikh Mohammed bin Rashid Al Maktoum attends the launch of Umm Al Quwain's Blue Economy Strategy at the World Government Summit 2022 (Asharq Al-Awsat)
Sheikh Mohammed bin Rashid Al Maktoum attends the launch of Umm Al Quwain's Blue Economy Strategy at the World Government Summit 2022 (Asharq Al-Awsat)

Umm Al Quwain, one of the seven emirates of the UAE, launched its “Sustainable Blue Economy Strategy 2031” in a move seeking to increase the emirate’s investment attractiveness while developing its natural, cultural, and human wealth.

The Sustainable Blue Economy Strategy initiative was launched at the World Government Summit 2022 and in the presence of Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE, and Ruler of Dubai, and under the directives of Sheikh Saud bin Rashid Al Mualla, Ruler of Umm Al Quwain and Member of the Supreme Council.

Sheikh Saud said that the strategy is aligned with the UAE’s efforts to enhance sustainable development and ensure optimal use of resources.

“The UAE places the highest priority on the wellbeing of its citizens by launching development plans, policies and strategies aimed at achieving a decent life for them and enabling them to actively participate in all development paths,” he said.

The UAQ Ruler affirmed that Sustainable Blue Economy Strategy 2031, provides opportunities for youth, entrepreneurs, and investors in vital and promising sectors.

He expressed the emirates' keenness to provide all the support necessary for promoting the growth and sustainability of investments and achieving the goals of all partners in the economic system.

During a session at the Summit, Sheikh Majid bin Saud bin Rashid Al Mualla, explained that the Strategy adopts a sustainable framework for the economy of Umm Al Quwain.

“We are keen to keep pace with the best global models for the development of national economic strategies. The Sustainable Blue Economy Strategy sets clear economic development goals based on the strengths of the emirate,” he said.

“Our goal is to double the GDP by 2031 and for the blue economy to contribute 40% of that total. We aim to meet a net-zero emissions target by 2031, by which time a total of 20% of Umm Al Quwain will be dedicated to nature reserves. We have also created three carbon-neutral areas,” Sheikh Majid added.

The strategy also includes establishing the Umm Al Quwain Centre for Entrepreneurship and the Blue Economy that will deliver eight transformative projects across diverse industry and research areas. In addition, it focuses heavily on creating new environmental, cultural, and heritage tourism areas to boost the popularity of one of the UAE’s most diverse but relatively undiscovered regions.

As part of the Sustainable Blue Economy Strategy, the emirate also plans to expand its already strong mangrove cover threefold by 2031 to make a major contribution towards its net-zero target.

The strategy covers 8 sectors: ecotourism, fish, sustainable industrial zones, maritime transport, research and development, blue carbon banks, environmental diversity services, and the social sector. The added value of investment in these sectors is estimated at 5 billion dirhams annually.

As for the most prominent transformational projects included in the strategy, they look to increase the size of the emirate’s nature reserves, to reach approximately 20% of its total area, allocate three carbon-neutral urban areas, and launch a center for the propagation and exporting of mangroves globally.

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Saudi Arabia Raises $12 Billion in International Bonds Amid Strong Demand

Skyscrapers are seen in King Abdullah Financial District in the Saudi capital, Riyadh. (Reuters).
Skyscrapers are seen in King Abdullah Financial District in the Saudi capital, Riyadh. (Reuters).
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Saudi Arabia Raises $12 Billion in International Bonds Amid Strong Demand

Skyscrapers are seen in King Abdullah Financial District in the Saudi capital, Riyadh. (Reuters).
Skyscrapers are seen in King Abdullah Financial District in the Saudi capital, Riyadh. (Reuters).

Saudi Arabia has raised $12 billion from global debt markets in its first international bond issuance of the year, attracting bids worth nearly $37 billion. This demonstrates strong investor appetite for Saudi debt instruments.

The issuance comes just two days after the approval of the 2025 annual borrowing plan by Minister of Finance Mohammed Al-Jadaan. The plan estimates financing needs for the fiscal year at SAR 139 billion ($37 billion). The funds will be used to cover the projected SAR 101 billion ($26.8 billion) budget deficit for 2025, as well as repay SAR 38 billion ($10 billion) in principal debt obligations due this year.

The National Debt Management Center (NDMC) announced on Tuesday that the issuance includes three tranches: $5 billion in three-year bonds, $3 billion in six-year bonds, and $4 billion in ten-year bonds. Total demand for the bonds reached $37 billion, exceeding the issuance size by three times and reflecting robust investor interest.

The NDMC emphasized that this issuance aligns with its strategy to broaden the investor base and efficiently meet Saudi Arabia’s financing needs in global debt markets.

According to IFR, a fixed-income news service, the initial price guidance for the three-year bonds was set at 120 basis points above US Treasury yields. The six-year and ten-year bonds were priced at 130 and 140 basis points above the same benchmark, respectively.

Strong demand allowed Saudi Arabia to lower yields on the shorter-term bonds, further demonstrating investor confidence. Economists noted that the pricing above US Treasuries is attractive in the current market, showcasing trust in Saudi Arabia’s economic stability and financial strategies.

International confidence

Economic experts view this successful bond issuance as a testament to international confidence in Saudi Arabia’s robust economy and financial reforms. Dr. Mohammed Al-Qahtani, an economics professor at King Faisal University, said the move underscores Saudi Arabia’s commitment to diversifying financing tools both domestically and internationally. He added that the funds would support Vision 2030 projects, reduce pressure on domestic resources, and attract strong international investor interest.

The issuance strengthens Saudi Arabia’s ability to meet financial needs, expand its investor base, and establish a global financing network, he said, noting that it also facilitates entry into new markets, enabling the Kingdom to accelerate infrastructure projects and capital expenditures.

Dr. Ihsan Buhulaiga, founder of Joatha Business Development Consultants, described the 2025 budget as expansionary, aimed at meeting the financing needs of economic diversification programs. He stressed that the budget deficit is an “optional” one, reflecting a deliberate choice to prioritize Vision 2030 initiatives over immediate fiscal balance.

Buhulaiga explained that the Kingdom’s approach balances two options: limiting spending to available revenues, which would avoid deficits but delay Vision 2030 initiatives, or borrowing strategically to fund Vision 2030 goals. He said that the annual budget is just a component of the larger vision, which requires sustained funding until 2030.

He continued that Saudi Arabia’s fiscal space and creditworthiness allow it to borrow internationally at competitive rates, explaining that this flexibility ensures financial sustainability without compromising stability, even during challenges like the COVID-19 pandemic.

Saudi Arabia’s debt portfolio remains balanced, with two-thirds of its debt domestic and one-third external. As of Q3 2024, public debt stood at approximately SAR 1.2 trillion, below the 30% GDP ceiling. According to the Ministry of Finance, the budget deficit is expected to persist through 2027 but remain below 3% of GDP.

Buhulaiga highlighted the importance of capital expenditure, which reached SAR 186 billion in 2023 and is projected to rise to SAR 198 billion in 2024, a 6.5% increase.

He emphasized the government’s pivotal role in economic diversification, supported by investments from the Public Investment Fund (PIF), the National Development Fund, and its subsidiaries, including the Infrastructure Fund.

The PIF recently announced a $7 billion Murabaha credit facility, facilitated by Citigroup, Goldman Sachs International, and JPMorgan. Meanwhile, the NDMC arranged a $2.5 billion revolving credit facility earlier in January, compliant with Islamic principles, to address budgetary needs.

In November, Moody’s upgraded Saudi Arabia’s credit rating to Aa3, aligning with Fitch’s A+ rating, both with a stable outlook. S&P Global assigns the Kingdom an AA-1 rating with a positive outlook, reflecting a high ability to meet financial obligations with low credit risk.

The IMF estimates Saudi Arabia’s public debt-to-GDP ratio at 26.2% in 2024, describing it as low and sustainable. This is projected to rise to 35% by 2029 as foreign borrowing continues to play a key role in financing deficits.