Gulf’s green and sustainable bond and sukuk market sets new record in 2022

• Total 2022 GCC green and sustainable bond and sukuk issuance of approx. $8.5 billion, compared to $605 million in 2021
• Saudi Arabia the region’s leading issuer in 2022 due to PIF’s three-tranche green bond 
• Several notable GCC government-related entities and banks entered green and sustainable bond and sukuk market in 2022

The market for green and sustainable bonds and sukuk in Gulf Cooperation Council (GCC) economies set a new record in 2022, with the issue count more than doubling and notable government-related entities and banks entering the market, according to data from Bloomberg’s Capital Markets League Tables. 

Total 2022 GCC green and sustainable bond and sukuk issuances reached $8.5 billion from 15 deals, compared with $605 million from 6 deals in 2021. Saudi Arabia was the leading issuer within the region, accounting for over 50% of total volumes, with the UAE accounting for the remaining issue volume. In 2021, all GCC issuances were generated by the UAE only. 

2022 saw notable debut issuances including a $3 billion green bond from Saudi Arabia's Public Investment Fund (PIF), a $750 million debut sustainable sukuk from Dubai Islamic Bank (DIB), a $750 million debut sustainable sukuk from Saudi National Bank (SNB), and a $500 million green bond from Abu Dhabi Commercial Bank (ADCB). Among established issuers, First Abu Dhabi Bank (FAB) remained among one of the region’s leaders in 2022 with three green bond issuances accounting for approximately $1.49 billion during the period. 

The Gulf region bucked the global trend which saw sales of new green and sustainable bonds and sukuk around the world decrease by 14% in 2022, from approximately $739 billion to $635 billion, in part due to global uncertainty and the rising interest rate environment. 

Venty Mulani, Data Specialist - Sustainable Fixed Income, Bloomberg LP, said: “Following COP27 in Egypt and ahead of COP28 in the UAE, the trajectory of the wider region’s green finance market has taken on new significance. 2022 proved to be a record year for green and sustainable bonds and sukuk in the Gulf, whereby the debut of several notable government-related entities and banks suggests sustainable finance is continuing to enter the mainstream in the region.” 

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