Jibrel was recently accepted into the Gulf Bonds and Sukuk Association (GBSA). This is a great milestone in our journey and vision of putting currencies, equities, commodities and other financial assets on the Ethereum blockchain. Not only does the acceptance aid in solidifying our foothold in the Middle East, but it provides the opportunity to create better products and have access to key institutional players. In this article we will explore what the Gulf Bonds and Sukuk Association is and how it will play an instrumental role for Jibrel moving forward.
What is the Gulf Bonds and Sukuk Association?
The Gulf Bonds and Sukuk Association is a Middle Eastern organization that is focused on promoting liquidity and prosperity in fixed income markets. The organization was founded in 2010 and has members from all parts of the Middle Eastern debt industry ecosystem. This inclusive approach allows issuers, investors, banks, ratings agencies, legal firms and service providers to benefit by having better access to one another. The GBSA does this through specialized regional committees, working groups and national chapters across the region that address high priority issues proposed by its members. As debt capital markets are increasingly relied upon and GCC markets are integrated into the global emerging market universe, the GBSA’s role is growing as well.
What Does This Mean For Jibrel?
This acceptance will help Jibrel gain access to insights and a network of diverse players within the Middle Eastern debt market. Such access would help optimize offerings and create products that are not only in tune with the needs of the current market, but the needs of tomorrow as well. Jibrel would be able to better understand the main pain points of existing processes and design smart contracts and products accordingly.
The GBSA also assists companies in communication with central banks, governments and regulators. Such assistance is crucial in an industry where regulation and compliance are around every corner. This will serve as another way for Jibrel to open a dialogue with bank, treasury and DCM (debt capital market) teams. The meetings and conferences held by the organization would ensure Jibrel’s voice is heard throughout the region as we forge ties with key institutions and regulators.
Middle East: A Growing Force in the Fixed Income Market
From rising interest rates in the United States to country-specific issues in countries like Argentina and Turkey, last year was largely defined by many challenges in the debt capital markets.
Yet the Middle Eastern market proved quite resilient.
In 2019, global fixed income will remain in the crosshairs of prevailing uncertainties of economics and policies around the world. From within the region however, the GCC governments continue to take bold steps regarding, both, fiscal reforms and efforts to diversify their economies away from energy. Furthermore, the inclusion of Saudi Arabia and four other Middle Eastern countries in leading JP Morgan indices over the course of 2019, will attract billions of dollars of new foreign investment into their debt offerings. Both conventional bonds and Sukuk will be eligible for inclusion in indices, but Sukuk will need to have a credit rating from at least one of the three major rating agencies to be included.
As low oil prices force countries to fund part of their state spending in the international debt markets there are plentiful investment opportunities among the issuers of corporate bonds in the region. The region’s governments and government related entities are becoming more open as investor interest in the region expands dramatically. This year alone, Saudi Arabia and Qatar have already come to market with multi-billion dollar debt issuances. With all these developments occurring at such as a rapid pace, we are very excited to see what the future will bring!
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