Middle East

Turkey continued to teeter on the brink of a currency crisis this week, as the lira went on another rollercoaster ride and touched a record low.

Delek Drilling, the Israeli energy company, launched a $2.25bn bond sale on Tuesday, in one of the few high yield emerging market bond deals seen during the coronavirus pandemic.

Israeli energy company, Delek Drilling, is set to launch a $2.25bn bond sale this week to support the expansion of its gas fields in the Mediterranean Sea, according to market sources.

GLP and First Abu Dhabi Bank both tapped investors in the renminbi bond market on Thursday. The Singapore-based logistics facilities provider took Rmb200m ($28.6m) from a Panda while the Middle Eastern firm headed to the Formosa market.

Falls in the Turkish lira have reignited concerns about a currency crisis this week, with the Central Bank of the Republic of Turkey’s (CBRT) unorthodox exchange rate policy raising questions from investors about the robustness of the country’s respected banking sector. Mariam Meskin and Ross Lancaster report.

Despite the success of many emerging market sovereigns in issuing bonds in international markets this year, Turkey, typically a leading issuer, has been notable by its absence. And with its foreign exchange reserves running lower, the risks of it not being able to come to market at all could be mounting.

Saudi Arabia has secured its inaugural green loan backed by an export credit agency (ECA). The deal, which is the first of its kind in the region, may have a domino effect on other sovereigns in the Gulf, said bankers.

This week in Keeping Tabs: what’s next after the EU recovery deal, assuaging public anger, and the Lebanese economy.

Gulf sovereigns are set to raise record levels of debt this year thanks to the double shock of Covid-19 and an oil price slump, but one name is on investors lips: Kuwait. Instead of relying on shrinking reserves, the sovereign, which has not printed since its international bond debut in 2017, is expected to pass a parliamentary law increasing its debt ceiling, according to experts.

The Emirate of Sharjah launched its debut Formosa bond on Tuesday. Experts say the format is gaining more interest from emerging market issuers looking to diversify, while investors beyond the traditional Taiwanese buyers are also taking an interest in the market.

The Emirate of Sharjah has mandated banks for a dollar Formosa bond. Some say the market is becoming an increasingly popular one for emerging market issuers to tap.

Oman, one of only two junk-rated sovereigns in the Gulf region, is tapping lenders for up to $2bn, as some say it could not find the right conditions in the bond market. According to bankers familiar with the deal, credit risk considerations are foremost and the sovereign will have to pay up to borrow.