Saudi Arabia Could Turn to Islamic Debt Markets

The transcript discusses Saudi Arabia's strategy to diversify its borrowing methods, including the use of sukuk or Islamic bonds, due to the under-supplied sukuk market. The country aims to alleviate pressure on local liquidity and address its large budget deficit. Additionally, the GCC finance ministers and IMF Managing Director Christine Lagarde met in Riyadh to discuss regional economic issues, focusing on reforms to counter declining oil revenues. A key topic was the introduction of a value-added tax in 2018.

What is one of the reasons Saudi Arabia is considering using sukuk for future borrowing?

• To diversify borrowing sources

• To increase local bond supply

• To reduce oil production

• To increase interest rates

Why is Saudi Arabia interested in the sukuk market?

• It offers higher interest rates

• It is oversupplied globally

• It is undersupplied globally

• It is a traditional borrowing method

What is one of the main topics discussed at the GCC finance ministers' meeting?

• Increasing sukuk supply

• Increasing oil production

• Introducing a value-added tax

• Reducing local bond issuance

Who attended the GCC finance ministers' meeting along with the finance ministers?

• IMF Managing Director Christine Lagarde

• NATO Secretary-General

• World Bank President

• UN Secretary-General

What economic challenge are the GCC countries facing, as discussed in the meeting?

• Surplus in budget

• Decrease in population

• Decline in oil revenue

• Increase in oil prices