TRSDC’s pioneers quietly turn a master plan into a mega brand

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Updated 08 August 2022
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TRSDC’s pioneers quietly turn a master plan into a mega brand

  • The project will develop 22 islands; three of them will contain 16 hotels, including three

RIYADH: When The Red Sea Project was announced on July 29, 2017, many were skeptical about executing a giga-project spanning 28,000 sq. km. The master plan was just half a page long. But, a few good people rose to the challenge. Today, they are pioneers leading the world’s most ambitious regenerative tourism project.

In 2018, Saudi Arabia’s Public Investment Fund launched The Red Sea Development Co. to drive the development of TRSP with 50 employees based in shared offices of a small building. Four years later, it is powered by a team of 2,000 people, all set to launch the project’s first phase in 2023.

One of the first employees to join the project was Ehab Alkindi, senior business administration director of TRSDC. In 2016, Alkindi was roped in from Saudi Aramco to facilitate the initiation of PIF’s three giga-projects NEOM, Qiddiyah and TRSDC. He played a vital role in setting up the strategic objectives, execution methodologies and regulatory frameworks of TRSDC.




Ehab Alkindi

“I have been lucky enough to be the Saudi Aramco employee who the PIF assigned to establish three magnificent projects in the Kingdom. I was the second employee to join the project, playing various roles starting from shaping the project’s vision, strategy, and master plans,” he said.

Another of the earliest employees is Abdulrahman Aldaris, presently the senior HR excellence manager of TRSDC. He has been closely involved in hiring a dedicated team of professionals committed to the Vision 2030 blueprint.

I have been lucky enough to be assigned to establish three magnificent projects in the Kingdom. I was one of the very first employees to join the project, playing various roles starting from shaping the project’s vision, strategy, and master plans.

Ehab Alkindi

“When I started working on The Red Sea Project in 2017, there were only a handful of passionate people believing in the Vision and working hard to set the foundations of what is today one of the most awaited destinations for the tourism market in the world,” said Aldaris.

Ashwaq AlBabtain, senior project manager, destination development at TRSDC, joined the company in April 2018 as a part of 35 employees responsible for the initial phases and the master plan.

“I remember the day the project was announced, and I felt mixed emotions, including happiness, joy and excitement as something new was happening in the Kingdom,” said AlBabtain.

AlBabtain started her journey in the project delivery team, setting up environmental guidelines and delivery strategies.

“We worked at a fast pace that I never saw in any organization. For example, if a task took you a day in another project, it would take you an hour in TRSP,” she added.




Ashwaq AlBabtain

Developing the master plan

“Design is an evolving process. As long as the vision is there, the design will evolve, and the vision will be achieved,” said Faisal Butt, executive director for project delivery, TRSDC.

An employee of the project since the summer of 2017, Butt describes his first days as vibrant. He quickly absorbed the undertaking’s processes and needs, which helped him sail through the headwinds afterward.

“When I first joined, there were maybe around two people in the Red Sea project and a few consultants. I still remember the day when the first master plan was only a half page,” said Butt, adding that it took the team a year and a half to develop the master plan.




Faisal Butt

BACKGROUND

The master plan was developed in partnership with the US-based architectural firm WATG and UK-based engineering consultant Buro Happold. It features unique design concepts from some of the world’s most prominent architecture firms.

“From then to now, we are delivering the first three hotels. I have seen the master plan evolve and come to life, and I can’t be more grateful,” he added.

The master plan was developed in partnership with the US-based architectural firm WATG and UK-based engineering consultant Buro Happold. It features unique design concepts from some of the world’s most prominent architecture firms.

The project will develop 22 islands; three of them will be completed by 2024. The three islands will contain 16 hotels, including three that will be ready next year.

“Each of these islands has its unique value and vision. There is the uniqueness of the hospitality brands’ architecture and positioning, with each having a different target market,” said AlBabtain.

The first phase is now halfway through. Several vital assets are fully operational, including a four-star hotel called the Turtle Bay, on-site offices, and a large landscape nursery.

“We want to target every market segment,” said AlBabtain.




Abdulrahman Aldaris

To get a sense of what TRSDC has achieved in the past five years, one needs to look at the strategic partnerships it forged recently. According to media reports, the company has procured over 800 contracts worth about $5.2 billion under the supervision of the group chief projects delivery officer of TRSDC, Ian Williamson.

Joined in 2017, Williamson has been responsible for leading the development and delivery of the project's planning, design and construction.

When I started working on TRSP in 2017, there were only a handful of passionate people believing in the vision and working hard to set the foundations of what is today one of the most-awaited destinations for the tourism market in the world.

Abdulrahman Aldaris

“As one of the first employees of The Red Sea Project, it gives me immense pride to have been there at the beginning with a tiny group of colleagues figuring out the first steps to take on this amazing journey,” said Williamson.

Sustainable mobility  

Another pioneer who joined in the early stages was Andreas Flourou, the operations executive director in the mobility department.

He joined in 2017 as the tenth employee and played a role in the recruitment of the administration team.

Three years later, he joined the mobility department, which manages transportation inside the resort, including land, sea and air mobility.

“The challenge is around providing sustainable transportation and introducing hydrogen and other environmentally friendly mobility,” he said.

The company signed several deals with electric vehicle manufacturers to supply them with cars, buses, buggies and vessels.

He added that the project would have hundreds of EVs in the first phase, 40 vessels and several aircraft to move people across the islands, all to be set for operational from the first day of the launch.

Flourou has further stated that no visitors will be allowed to drive their cars inside the resorts, as the developers will provide all on-site transportation.

The company has signed a memorandum of understanding with ZeroAvia, a British-American hydrogen-electric aviation firm, to test and develop zero-emission travel across its new luxury tourism destination focusing on environmental sustainability and regeneration.

“The delivery will start immediately; we are in the advanced stages of discussion,” said Flourou.




Andreas Flourou

Personal and environmental security

TRSDC has also adopted an innovative model of medical care by creating a facility to treat its employees rather than leaving the responsibility to individual contractors, ensuring that all workers have equal access to senior medical personnel and high standards of care.

According to Ahmad Darwish, group chief administrative officer of TRSDC, the crucial security targets included maintaining safe construction practices and ensuring zero lost time incidents while constructing marine jetties, coastal villages and base camps.




Amjaad Alangari

The company is also determined to develop its tourist resorts without harming the environment.

According to Butt, there will be some environmental disturbance whenever there is human intervention, but that does not hold for TRSP.

Today, not only am I helping to develop a brand new tourism industry for the Kingdom, but I am learning and developing as the project develops.

Amjaad Alangari, Senior marketing manager at TRSDC

“What we have done is showing that development can happen in a way that is not only protecting the environment but regenerating it as well,” Butt said.

The company is leading by example in its destination’s marine project. The challenge was preserving flora and fauna on the ground, with hundreds of people working in the vicinity. So, it maximized the off-site construction and minimized the on-site work as much as possible.

“A lot of the structure of the villas were fabricated somewhere else then brought and placed on site; in some cases, we reduced physical construction by 40 percent,” he added.




Ahmed Darwish

The aftermath of the pandemic

“The pandemic represented an unprecedented challenge for all of us in TRSDC. However, we worked together as a team throughout 2020 to surpass the challenges encountered and continue to do so today,” said Darwish.

In the middle of the COVID-19 pandemic, the group was keen to manage its tasks in one way or another.

Working from home became the new normal, but the harmony and passion the pandemic left on the team were remarkable, pointed out Amjaad Alangari, senior marketing manager, TRSDC.

In some cases, the project saw months of delays. For instance, the first phase was scheduled for completion in 2022 before pushing the date back to the middle of 2023.

“We tried to lower the delays by accelerating some of the projects and increasing some shift times,” said Butt.

To Butt, the challenge was not limited to the 12-18 months of lockdown; it also had substantial cost implications.

“The pandemic directly impacted the global supply chain, which in turn affected a large giga-project like us that depends on supplies from around the world,” said Butt adding the prices of a forty-foot container soared by 500 percent.

Building the brand identity

For Alangari, one of the first five employees of TRSDC, the journey at the company has been as eventful as her role as the company’s marketing whiz.

She was instrumental in conceiving the brand identity, including developing its logo that symbolically represents the destination’s islands, natural attributes, flora and fauna.

Alangari and her team are also devising a slogan that best describes the unforgettable experience the destination has to offer for its visitors.

The slogan will be unveiled during the launch of the project’s first phase.

“Working in TRSDC has opened many opportunities for me as a young Saudi woman. Today, not only am I helping to develop a brand new tourism industry for the Kingdom, but I am learning and developing as the project develops,” said Alangari.


Closing Bell: Saudi main index closes in red at 11,671 

Updated 30 April 2025
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Closing Bell: Saudi main index closes in red at 11,671 

RIYADH: Saudi Arabia’s Tadawul All Share Index dipped on Wednesday, losing 74.62 points, or 0.64 percent, to close at 11,671.58. 

The total trading turnover of the benchmark index was SR6.94 billion ($1.85 billion), as 47 stocks advanced, while 201 retreated. 

The MSCI Tadawul Index decreased by 4.89 points, or 0.33 percent, to close at 1,488.88. 

The Kingdom’s parallel market Nomu dipped, losing 54.20 points, or 0.19 percent, to close at 28,277.17. This came as 24 stocks rose, while 49 fell.

The best-performing stock on the main index was Jamjoom Pharmaceuticals Factory Co., with its share price surging by 9.91 percent to SR173. 

In the first quarter of 2025, the company’s net profit rose 204.26 percent quarter-on-quarter to SR157.03 million, according to a filing on the stock exchange. The group attributed the increase to higher sales and more efficient absorption of operating expenses, resulting in strong operating leverage. 

MBC Group Co. recorded the day’s steepest decline, with its share price slipping 4.42 percent to SR41.10. 

Advanced Petrochemical Co. announced its interim financial results for the first three months of the year, reporting a net profit of SR72 million — a 224.1 percent increase from the same quarter last year. 

Americana Restaurants International PLC also announced its financial results for the same period, with its net profit reaching SR122.4 million in what is an annual increase of 16.5 percent.

Similarly, the company’s total comprehensive income saw a surge of 44.5 percent to SR128.13 million. Its share price traded 3.04 percent higher on the main market to reach SR2.32. 

Modern Mills for Food Products Co. also announced its interim financial results for the first three months of the year, with net profit amounting to SR65.6 million, a 29.2 percent surge compared to the previous quarter. 

The company attributed the increase to higher gross margin, operational efficiencies and lower finance cost. 

Modern Mills for Food Products Co.’s share price traded 0.26 percent higher on the main market to reach SR39. 

Banque Saudi Fransi has launched the offering of US dollar-denominated additional Tier 1 capital notes as part of its international issuance program, the bank said in a bourse filing. 

The offering, conducted under its Additional Tier 1 Capital Note Programme, targets eligible investors in Saudi Arabia and internationally, the statement added. 

The subscription period is scheduled to begin on April 30 and end on May 1, with a minimum subscription set at $200,000 and increments of $1,000 thereafter. 

The value, pricing, and yield of the perpetual instruments — which are callable after six years — will be determined based on prevailing market conditions. 


Saudi Arabia raises undeveloped land tax to 10%, expands scope to vacant properties

Updated 30 April 2025
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Saudi Arabia raises undeveloped land tax to 10%, expands scope to vacant properties

JEDDAH: Saudi Arabia has raised the annual fee on undeveloped land from 2.5 percent to up to 10 percent of property value, as part of Cabinet-approved reforms to address market imbalances. 

The amendments to the White Land Tax Law expand its scope for the first time to include levies on long-vacant buildings and revised land-size thresholds for taxation. 

The changes, ratified by the Cabinet on April 29, mark the most significant overhaul of the law since its inception in 2016. 

They come as part of a broader effort to accelerate development, counter speculation, and address supply-demand imbalances in the Kingdom’s real estate sector, which has seen mounting pressure in key cities such as Riyadh. 

The reforms support broader efforts to curb speculation, boost land utilization, and enhance access to affordable housing in line with Vision 2030.

In a post on his official X account, Minister of Municipal, Rural Affairs and Housing Majid Al-Hogail said: “The amendments included stimulating the use of vacant properties, and amending the targeted areas and the amount of the fee on undeveloped and developed vacant lands within the urban area, by up to 10 percent.”

The revised framework sets a minimum land area of 5,000 sq. meters for the application of the fee, covering both individual plots and contiguous holdings in designated urban areas. 

It also broadens the tax base to include vacant buildings — defined as ready-to-use buildings prepared for occupancy within the urban area that have not been used for a long period without acceptable justification, and whose lack of use or exploitation affects the availability of sufficient supply in the real estate market.

These vacant properties will now face an annual levy of up to 5 percent of their estimated rental value, as specified in forthcoming regulations.

The updated law introduces clearer criteria, phased implementation, and enhanced enforcement mechanisms, including grievance channels and unified property databases.

The Kingdom originally launched the White Land Tax Law to discourage land hoarding and promote more equitable development.

According to the Saudi Press Agency, Al-Hogail stated that the revised system is expected to enhance the efficient use of idle land and buildings, align supply with demand, and promote the productive use of real estate assets. It also seeks to encourage the development of undeveloped land and increase the overall availability of real estate, particularly residential properties.

Speaking to Al-Ekhbariya, Saif Al-Suwailem, spokesperson for the Ministry of Housing, said that the executive regulations for vacant property fees will outline the implementation mechanism.

The official added: “The amendments to the White Land Tax will enhance land use efficiency and stimulate the development of residential projects,” Al-Ekhbariya reported.

Moreover, he emphasized that amending the fees will have a clear and effective impact on enhancing supply and achieving real estate balance, noting that the system was completed in half the time.

The changes come as Saudi authorities intensify efforts to stabilize the housing market in cities like Riyadh, where surging land values and rental rates have strained affordability. 

A study by the Royal Commission for Riyadh City and the Council of Economic and Development Affairs recently prompted a series of measures, including lifting development restrictions in large swaths of northern Riyadh.

The government will issue executive regulations for the amended White Land Tax Law within 90 days of its publication in the official gazette. Regulations governing vacant property taxation are expected within one year, according to SPA.


Saudi banks weathering external debt surge amid Vision 2030 push: S&P report

Updated 30 April 2025
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Saudi banks weathering external debt surge amid Vision 2030 push: S&P report

RIYADH: Saudi Arabia’s banking sector is set to absorb a rise in external debt, driven by increasing financing demands under the Kingdom’s Vision 2030 agenda, according to a new report.

The analysis by S&P Global Ratings revealed that despite a marked increase in external liabilities over the past three years, Saudi banks remain in a strong position to manage associated risks.

The uptick in debt is primarily linked to short-term instruments, such as interbank and non-resident deposits, as well as bond issuances on international capital markets.

In 2024, Saudi banks extended loans worth SR371.8 billion ($100 billion), while deposits grew by only SR218.9 billion, creating a funding gap of SR152.9 billion to be refinanced.

S&P estimates that by the end of 2028, net external debt will account for only 4.1 percent of total lending, a manageable level by industry standards.

“More recently, banks have increasingly tapped international capital markets for funding as local sources proved insufficient to meet the country’s ambitious requirements, as set out in the state’s Saudi Vision 2030 development program, and the expected growth in corporate financing requirements,” the study stated.

The Kingdom’s lenders, which until recently maintained a net external asset position, posted a net external debt of SR34 billion by the end of 2024. S&P expects foreign liabilities to almost double over the next three years.

Saudi banks’ external funding remains heavily skewed toward interbank deposits and repurchase agreements, accounting for 55 percent of the increase in gross external debt last year.

Notably, 59 percent of all external debt in 2024 was owed to foreign banks, raising concerns over volatility, given the short-term nature of such funding.

Despite this, the report noted that nearly half of these foreign deposits originate from within the Gulf Cooperation Council, where banking systems are flush with liquidity.

This regional funding base, coupled with Saudi Arabia’s proven record of state support, is expected to cushion any potential shocks.

“We view Saudi authorities as highly supportive of the banking system and expect extraordinary support will be forthcoming should the need arise,” the analysis stated.

The agency also dismissed direct comparisons with Qatar, whose banking sector experienced a sharp rise in external debt during its infrastructure build-up for the 2022 FIFA World Cup.

At its peak, Qatar’s net banking external debt reached 40.6 percent of domestic loans at the end of 2021.

As of end-2024, Saudi banks held gross external debt of $109.5 billion, nearly “quadruple” its $29.5 billion at the end of 2018.

Yet the country’s total banking assets are almost double those of Qatar, helping to absorb the increase in debt.

In parallel with external funding, Saudi banks are exploring ways to unlock balance sheet capacity through mortgage asset sales.

The Saudi Real Estate Refinance Co. had acquired SR28.8 billion in home loans by the end of 2024, while discussions around mortgage-backed securities remain ongoing.

Despite holding mortgage portfolios worth $180 billion, or 23 percent of total lending, banks have been cautious about divestment.

Factors include favorable profitability, past losses due to higher interest rates, and investor hesitation around default recovery mechanisms in the Kingdom.

However, S&P predicts that a local market for residential mortgage-backed securities will gradually emerge, supporting further liquidity creation.

The report concludes that while external debt will continue to grow in the short term, Saudi banks retain ample headroom to navigate the risks, thanks to strong fundamentals, sovereign backing, and a measured approach to financial innovation.


Kuwaiti investors encouraged to explore opportunities in Saudi Arabia by industry minister

Updated 30 April 2025
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Kuwaiti investors encouraged to explore opportunities in Saudi Arabia by industry minister

RIYADH: Saudi Arabia’s minister of industry and mineral resources has urged Kuwaiti investors to seize untapped opportunities in the Kingdom’s mining sector.

The encouragement was given during Bandar Alkhorayef’s meeting on April 30 with a group of Kuwaiti businessmen at a gathering organized by the Saudi Embassy as part of the minister’s official visit to the Gulf country. 

The trip was designed to strengthen economic ties, enhance cooperation in the industrial and mining sectors, and attract high-quality investments to the Kingdom, according to a statement.

During his meeting with the investors, the minister highlighted the crucial contribution of the industrial and mining sectors to the Kingdom’s economic diversification, aligning with Saudi Vision 2030’s aim to establish the country as a global industrial leader and a key hub for mineral production and processing.

This aligns with developments across the Saudi mining sector in order to maximize its impact on the national economy and exploit mineral resources, estimated at more than SR9.3 trillion ($2.47 trillion), Alkhorayef noted.

“He pointed out that the National Industrial Strategy focuses on developing and localizing 12 vital industrial sectors, most notably food, pharmaceuticals, automotive, and aviation, as these sectors provide promising investment opportunities for local and international investors,” the newly released ministry statement said.

“His Excellency pointed out the Kingdom’s endeavor to enable industrial transformation by adopting the latest manufacturing technologies, including applications of the Fourth Industrial Revolution, developing digital infrastructure in the industrial sector, and developing human capabilities and qualifying them to deal with advanced technologies,” it added.

During the meeting, Alkhorayef highlighted the Kingdom’s launch of the Factories of the Future program, which aims to automate industrial facilities and transform them into smart factories.

The minister also indicated that the General Geological Survey Program for Mining Exploration currently covers 60 percent of the Arabian Shield region and that the sector offers promising investment opportunities in all stages of mining.

He highlighted Saudi Arabia’s strategic advantages that position it as a prime global investment hub, such as its location connecting three continents, advanced infrastructure, and abundant natural resources, as well as varied energy options and streamlined government processes and licensing.

Toward the end of the meeting, Alkhorayef encouraged Kuwaiti companies and investors to explore the distinctive opportunities in the Kingdom’s industrial and mining sectors, emphasizing the nation’s supportive capabilities and incentives designed to facilitate and enhance the investor experience.

Saudi Arabia, Kuwait to bolster collaboration in oil, commerce, industry

Bandar Alkhorayef meeting with Minister of Oil Tariq Sulaiman Al-Roumi. X/@BAlkhorayef

During his official visit to Kuwait, Alkhorayef also held bilateral meetings with the Minister of Commerce and Industry Khalifa Abdullah Al-Ajeel and the Minister of Oil Tariq Sulaiman Al-Roumi.

During the meeting with Al-Ajeel, the Saudi minister praised the longstanding and robust ties between the Kingdom and Kuwait, emphasizing that these historical relations serve as a solid foundation for strategic economic partnerships, particularly in the industrial sector.

The discussion also emphasized the need to bolster industrial integration between the two sides in order to advance sustainable industrial development and promote economic diversification in both nations.

The meeting with Sulaiman saw the crucial role of the crude oil sector highlighted as a key driver of development in both countries. It also explored strategic opportunities to expand collaboration in the petrochemical industry and discussed ways to increase trade exchange and direct joint investments toward emerging, high-potential sectors.

In an interview with Arab News on the sidelines of the Standard Incentives for the Industrial Sector event in January, Alkhorayef said that Saudi Arabia is taking a flexible approach to distributing its SR10 billion standardized incentive program — which provides financial support to industrial projects — to maximize its impact.

At the time, the minister said the program is designed to align with investor demand and deliver optimal returns.


GCC share of emerging-market dollar debt jumps to 35% in Q1 

Updated 30 April 2025
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GCC share of emerging-market dollar debt jumps to 35% in Q1 

RIYADH: Gulf Cooperation Council countries accounted for over 35 percent of all emerging-market US dollar debt issued in the first quarter of the year— excluding China— marking a sharp increase from around 25 percent in 2024, a new report revealed. 

In its latest analysis, Fitch Ratings forecast that the share is expected to continue rising through 2025 and 2026 as regional governments and corporations increasingly turn to debt capital markets for funding diversification, project finance, and budget support amid fiscal pressures and global economic uncertainty. 

The report stated that the total value of the GCC DCM exceeded $1 trillion across all currencies by the end of the first quarter, marking a 10 percent year-on-year increase.

Issuance reached $89 billion in the first three months of the year, up 11 percent from the previous quarter but down 3 percent compared to the same period of 2024. 

Despite a slowdown in activity since early April, Fitch noted “a healthy pipeline” is developing, supported by strong regional and Islamic investor liquidity. 

“The GCC DCM continues to be fragmented among its six member countries in its maturity, depth, and credit profile, with Saudi Arabia and the UAE the most mature,” the report stated. 

“In Kuwait, Qatar, Bahrain, and Oman, the lack of a link with international central securities depositories such as Euroclear or Clearstream partly hinders foreign-investor participation in the local-currency DCMs,” it added. 

According to the global investment banking firm State Street Global Advisors, other regions saw divergent trends. Brazil led the emerging market in local bond returns with a 13.7 percent gain, driven by currency appreciation and rate hikes. 

In contrast, Turkiye posted an 8.7 percent decline, reflecting political instability and currency depreciation. These shifts underscore varying macroeconomic dynamics across emerging markets. 

In the Kingdom, foreign investors increased their participation in local government debt, accounting for 7.7 percent of the investor base at the end of the first quarter of the year, up from 4.5 percent in 2024. 

Fitch noted that pressure from declining oil prices — forecast at $65 per barrel for 2025 and 2026 due to OPEC+ cuts and trade-related volatility — could widen fiscal deficits and lead to increased borrowing. 

Among the most vulnerable are Bahrain and Saudi Arabia, while Qatar, Kuwait and Abu Dhabi benefit from substantial sovereign wealth assets. Oman is seen as relatively well-positioned fiscally. 

Interest rate expectations are also playing a role in shaping the DCM outlook. Fitch projects the US Federal Reserve to lower rates to 4.25 percent by end of 2025, with GCC central banks expected to follow suit. 

Lower rates could support further issuance, as banks and corporates across the region continue to diversify their funding strategies. 

Sukuk remains a cornerstone of the GCC’s DCM, comprising around 40 percent of the total outstanding by the first quarter of the year. 

The region holds over 40 percent of the global sukuk market, though issuance fell 51 percent year on year in the first quarter to $18.2 billion. 

Conventional bonds rose 29 percent over the same period. Fitch reported that 83.5 percent of Fitch-rated GCC US dollar sukuk are investment-grade, with 57.8 percent in the “A” category and the majority holding stable outlooks. 

Environmental, social and governance financing is also gaining traction in the region, with GCC countries’ ESG DCM surpassing $50 billion in all currencies by the end of the quarter. 

National-level regulatory reforms are also reshaping local markets. In Kuwait, the cabinet’s approval of a long-delayed financing and liquidity law is expected to unlock new borrowing capacity. 

In the UAE, the apex bank continues to advance the Dirham Monetary Framework, with the currency’s share in the domestic DCM growing to 24.9 percent from just 0.5 percent in 2020. 

Sustainable finance is also gaining momentum, with the UAE developing a Sustainable Islamic M-Bills program and Qatar unveiling a sustainable finance framework. 

Despite global uncertainty, Fitch emphasized the resilience of the region’s credit quality, noting that no Fitch-rated GCC sukuk or bonds defaulted in 2024 or the first quarter of 2025.