Even as Wall Street heavyweights flock to Riyadh for a Davos-style conference, Saudi Arabia is grappling with low oil prices, budget deficits and challenges attracting foreign investment.
That’s forcing the kingdom to lean heavily on another source of funding: debt.
The Saudi government and entities like its Public Investment Fund have issued around $50 billion in bonds in 2024, according to data compiled by Bloomberg, which includes corporate and sovereign sales in US dollars and euros. That flurry of activity has made the oil-rich country one of the biggest issuers of international debt in emerging markets this year. It’s likely to borrow tens of billions of dollars more in 2025, according to Nadim Amatouri, director of fixed income research at Arqaam Capital.
This week, the kingdom kicks off its annual Future Investment Initiative, an event that will draw global names like Goldman Sachs Group Inc.’s David Solomon, Citigroup Inc.’s Jane Fraser and Alphabet Inc.’s President Ruth Porat. It will offer a look at investor appetite for Saudi Arabia as the country pushes to diversify from oil in the face of rising fiscal challenges.
Crude has been trading well below $100 a barrel, despite the kingdom having cut supply along with other members of the OPEC+ cartel, and hundreds of billions of dollars are being spent on Crown Prince Mohammed bin Salman’s Vision 2030 economic-transformation plan.
International investors have so far been slow to put money into key projects such as the new city of Neom.
Inflows of foreign direct investment were the lowest since 2020 last year and stagnated in the first half of 2024, making debt ever more vital to Riyadh’s ambitious projects and developments.
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