Sukuk issuance will contract by 5% to around $170 billion in 2020 due to the coronavirus (COVID-19) pandemic, which is set to be limited by the financing needs in the GCC countries due to low oil prices, according to Moody's Investors Service.

Moody's referred that the decline in Sukuk issuance came following four years of rapid growth.

The VP-senior credit officer at Moody's, Nitish Bhojnagarwala, noted that the GCC countries are expected to lead a rally in issuance to nearly $90 billion in the second half (H1) of 2020.

During the first half (H1) of 2020, the total Sukuk issuance retreated by 12% to $77 billion, when compared to the corresponding period of 2019.

Issuance in Southeast Asia fell by 25%, while it increased by 7% in the Middle East.

However, this year will witness the second-highest ever Sukuk issuance in total, following a 36% rise in 2019.

In the second half (H2), Sukuk issuance will recover, as countries are raising money to alleviate the COVID-19 impacts.

In addition, low oil prices would raise deficits and financing needs among oil-exporting issuers, namely in Gulf countries.

Source: Mubasher

All Rights Reserved - Mubasher Info © 2005 - 2020 Provided by SyndiGate Media Inc. (Syndigate.info).

Disclaimer: The content of this article is syndicated or provided to this website from an external third party provider. We are not responsible for, and do not control, such external websites, entities, applications or media publishers. The body of the text is provided on an “as is” and “as available” basis and has not been edited in any way. Neither we nor our affiliates guarantee the accuracy of or endorse the views or opinions expressed in this article. Read our full disclaimer policy here.