‘Abu Dhabi plans to sell Treasury bills next year’

DUBAI: Abu Dhabi plans to start selling Treasury bills for the first time next year, according to people with knowledge of the matter, as the Organisation of the Petroleum Exporting Countries producer seeks to develop its local-currency debt market.

The government was working with international and local banks on how the notes will be structured, said the people.

Regulations are expected to be completed next year and regular sales could follow shortly after that, said the people.

Abu Dhabi, home to about six per cent of the world’s known oil reserves and capital of the United Arab Emirates, was 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 US$10 billion (RM40.8 billion) from a bond sale.

The UAE was 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 UAE 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. Bloomberg