The UAE is set to roll out some initiatives to boost its debt capital market, as it seeks to strengthen its position as a global economic hub.

The country’s Ministry of Finance has launched a joint project with the Central Bank of the UAE to develop the market by setting up programmes to facilitate the issuance or listing of local public debt instruments in the primary and secondary local markets.

The debt instruments will include bonds and Islamic treasury sukuk in UAE dirhams.

As part of the project, the two agencies are expected to work together to provide reference pricing points for local financing operations carried out by financial institutions in the UAE, to boost local market activity and expand investor base.

Around $77 billion in sukuk are currently listed in Dubai, while the total value of bonds listed in the emirate is pegged at $39 billion, according to the Dubai Financial Market (DFM).

The UAE’s debt capital market jumped by 10% to $270 billion for all currencies at the end of 2023, according to Fitch Ratings. Around 71% of the issuances were in US dollars and 20.5% were in UAE dirhams.

Last year, sukuk issuances in all currencies surged by 115% to $12.7 billion, while bond issuances rose 23.6% to $132.9 billion.

As of early 2023, the US has the largest bond market in the world, valued at more than $51 trillion, according to a World Economic Forum report, citing data from the Bank for International Settlements.

China came second, accounting for 16% of the global total, followed by Japan, France and the United Kingdom in the top five.

(Reporting by Cleofe Maceda; editing by Seban Scaria)