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UAE’s Major Projects and Sustainability Goals Drive growth in Bonds and Sukuk Issuance
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- UAE’s Major Projects and Sustainability Goals Drive growth in Bonds and Sukuk Issuance
The UAE is accelerating its development across vital sectors such as infrastructure, renewable energy, and real estate, underpinned by a strategic vision that places sustainability at the core of its economic policies. These initiatives are not only transforming the nation’s landscape but also serving as key pillars for the growth of sukuk and bond issuances in the coming years.
According to Bashar Al-Natour, Executive Director and Global President of Islamic Finance at the Global Credit Codex Agency, while conventional financing methods still dominate major project funding, the demand for innovative and sustainable financing sources has substantially strengthened the issuance market. “Sukuk and bonds have contributed to partial financing for some previous projects,” he noted in statements to the Emirates News Agency (WAM).
Diversifying Financing Sources
The UAE’s public and private institutions are increasingly turning to bonds and sukuk to finance projects, moving away from traditional tools. This shift is driven by the need to diversify financing sources and promote sustainable investments.Al-Natour highlighted that several projects, both governmental and private, have been announced for the coming years, including real estate developments, infrastructure upgrades, and renewable energy initiatives.
For instance, Dubai’s infrastructure sector has been allocated 46% of the government’s total expenditures in the 2025-2027 budget. These projects encompass road networks, tunnels, bridges, transportation systems, sewage stations, parks, renewable power stations, and the rainwater drainage network development plan. Additionally, the expansion of Al Maktoum airport, announced last year, and other initiatives aimed at enhancing smart and sustainable transport are set to further bolster the region’s development.
Green Projects and Climate Neutrality
The UAE’s commitment to achieving climate neutrality by 2050 is a driving force behind its green projects.Al-Natour emphasized that this strategic vision is pivotal in supporting the sukuk and bond markets, especially in the renewable energy and sustainability sectors. “The UAE is working to launch a series of green projects that aim to achieve economic and environmental sustainability,” he said.
These initiatives align with global trends, as highlighted by Standard & Poor’s and Fitch, which predict an increasing reliance on sukuk and bonds in the coming years. The focus on sustainable investments is expected to attract both local and international investors, further solidifying the UAE’s position as a leader in innovative financing.
Key Projects Driving Sukuk and Bond Issuance
| Sector | Key Projects | Impact on Financing |
|————————–|———————————————————————————-|———————————————|
| Infrastructure | Roads, tunnels, bridges, transportation systems, sewage stations, parks | High demand for sukuk and bonds |
| Renewable Energy | Renewable power stations, rainwater drainage network | Attracts sustainable investment |
| Real Estate | Residential and commercial developments | Diversifies financing sources |
| Transportation | Al Maktoum Airport expansion, smart transport systems | enhances quality of life and sustainability |
The Road Ahead
As the UAE continues to prioritize sustainability and innovation, the role of sukuk and bonds in financing major projects is set to grow. This shift not only supports the nation’s economic and environmental goals but also creates opportunities for investors seeking sustainable and impactful investments.
For more insights into the UAE’s financing strategies and project developments, visit the Emirates News Agency (WAM).
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Stay updated on the latest developments in the UAE’s infrastructure and sustainability projects by exploring our detailed analysis and reports.Dubai’s $8.2 billion Rainwater Drainage Network and UAE’s Green finance Initiatives Drive Sustainable Growth
Dubai is set to transform its infrastructure with a massive $8.2 billion rainwater drainage network project, slated for completion by 2033. This aspiring initiative, highlighted by Gobta Gold, Director of Sovereign Classifications at Standard & Poor’s Global Credit Code, underscores the UAE’s commitment to sustainable development and climate resilience.
The project, which will be implemented in stages, is part of a broader strategy to address environmental challenges and enhance urban infrastructure. According to Gold, “low interest rates will contribute to the growth of companies and individuals, including mortgage,” creating a favorable economic surroundings for such large-scale investments.
UAE’s Green Finance strategy Attracts Global Investors
The UAE’s focus on green projects has positioned it as a hub for sustainable finance. Al-Natour, a financial expert, emphasized that the country’s green initiatives represent a “strategic direction that attracts global investors interested in financial instruments related to sustainability.” This aligns with the UAE’s environmental goals and its efforts to diversify its economy.
In recent years, the UAE has made significant strides in developing its capital markets. At the federal level, the government began issuing foreign currency publications in 2021, followed by Treasury bonds in local currency in May 2022.These efforts were further bolstered by the issuance of local currency bonds in April 2023, which are expected to “support the development of capital markets in the United arab Emirates and help build the return curve for non-sovereign exporters.”
Table: Key Highlights of UAE’s green Finance and Infrastructure Projects
| Initiative | Details |
|————————————|—————————————————————————–|
| Rainwater Drainage Network | $8.2 billion project in Dubai, to be completed by 2033 |
| Green Finance Publications | Increased issuance of sukuk and bonds for sustainable projects |
| Treasury Bonds | Local currency bonds issued in May 2022 and April 2023 |
| Global Investor Appeal | Strategic green projects attracting international investment |
Building a Sustainable Future
The UAE’s commitment to sustainability extends beyond infrastructure.The country has seen a rise in publications for both sukuk and bonds, which are being used to finance projects aligned with its environmental objectives. These financial instruments not only support the UAE’s green agenda but also offer lucrative opportunities for investors.
As Dubai prepares to unveil its state-of-the-art rainwater drainage system, the UAE continues to lead the way in sustainable development.With low interest rates fostering economic growth and a robust green finance strategy attracting global capital, the country is well-positioned to achieve its long-term environmental and economic goals.
For more insights into the UAE’s green finance initiatives, explore standard & Poor’s Global Credit Code and stay updated on the latest developments in sustainable investment.
The road Ahead
As the UAE continues to prioritize sustainability and innovation, the role of sukuk and bonds in financing major projects is set to grow. This shift not only supports the nation’s economic and environmental goals but also creates opportunities for investors seeking lasting and impactful investments.
For more insights into the UAE’s financing strategies and project developments, visit the Emirates News Agency (WAM).
Stay updated on the latest developments in the UAE’s infrastructure and sustainability projects by exploring our detailed analysis and reports.
Dubai’s $8.2 Billion Rainwater Drainage Network and UAE’s Green Finance Initiatives Drive Sustainable Growth
Dubai is set to transform its infrastructure with a massive $8.2 billion rainwater drainage network project, slated for completion by 2033. This aspiring initiative, highlighted by Gobta Gold, Director of Sovereign Classifications at Standard & Poor’s Global Credit Code, underscores the UAE’s commitment to sustainable development and climate resilience.
The project, which will be implemented in stages, is part of a broader strategy to address environmental challenges and enhance urban infrastructure. According to Gold, “low interest rates will contribute to the growth of companies and individuals, including mortgages,” creating a favorable economic surroundings for such large-scale investments.
UAE’s Green Finance Strategy Attracts Global Investors
The UAE’s focus on green projects has positioned it as a hub for sustainable finance. Al-Natour, a financial expert, emphasized that the country’s green initiatives represent a “strategic direction that attracts global investors interested in financial instruments related to sustainability.” This aligns with the UAE’s environmental goals and its efforts to diversify its economy.
In recent years, the UAE has made significant strides in developing its capital markets. At the federal level, the government began issuing foreign currency publications in 2021, followed by Treasury bonds in local currency in May 2022. These efforts were further bolstered by the issuance of local currency bonds in April 2023, which are expected to “support the development of capital markets in the United Arab Emirates and help build the return curve for non-sovereign exporters.”
Table: Key Highlights of UAE’s Green Finance and Infrastructure Projects
| Initiative | Details |
|---|---|
| Rainwater Drainage Network | $8.2 billion project in Dubai, to be completed by 2033 |
| Green Finance Publications | increased issuance of sukuk and bonds for sustainable projects |
| Treasury Bonds | Local currency bonds issued in May 2022 and April 2023 |
| Global Investor Appeal | Strategic green projects attracting international investment |
Building a Sustainable Future
The UAE’s commitment to sustainability extends beyond infrastructure. The country has seen a rise in publications for both sukuk and bonds, which are being used to finance projects aligned with its environmental objectives.These financial instruments not only support the UAE’s green agenda but also offer lucrative opportunities for investors.
As Dubai prepares to unveil its state-of-the-art rainwater drainage system, the UAE continues to lead the way in sustainable development. With low interest rates fostering economic growth and a robust green finance strategy attracting global capital, the country is well-positioned to achieve its long-term environmental and economic goals.
