(Bloomberg) -- Abu Dhabi plans to start selling treasury bills for the first time next year, according to people with knowledge of the matter, as the OPEC producer seeks to develop its local-currency debt market.
The government is working with international and local banks on how the notes will be structured, the people said, asking not to be identified because the discussions are private. Regulations are expected to be completed next year and regular sales could follow shortly after that, the people said.
Abu Dhabi, home to about 6 percent of the world’s known oil reserves and capital of the United Arab Emirates, is exploring ways to bridge a budget deficit after oil prices dropped. The emirate, whose debt carries the third-highest investment grade at S&P Global Ratings, in October raised $10 billion from a bond sale. The U.A.E. is working on a federal debt law to allow the nation to sell local-currency debt.
Fitch Ratings said last year that Abu Dhabi’s department of finance was working with the central bank on a plan to issue local debt, but said the timing and the size of sales were uncertain. The central bank referred questions to the department of finance, which didn’t immediately respond to requests for comment.
The U.A.E. is the only member of the six-nation Gulf Cooperation Council that hasn’t sold the notes. Governments issue treasury bills as a money management tool and to develop a yield curve.
©2017 Bloomberg L.P.
RECOMMENDED FOR YOU
POPULAR