Debt

GCC fiscal deficits and financing post COVID-19

The economic repercussions of the impact of novel Coronavirus and the subsequent breakdown of OPEC+ supply cut agreement is unprecedented for the gulf economies. The sudden freeze in economic activity due to various measures such as travel restrictions (curbs on flights, public transportations and taxis), closing of schools, universities, shopping malls, commercials establishments, and curfew imposition to prevent the spread of virus has created a demand shock. Transportation sector that accounts for approx. 50 percent of global oil demand by...

Is Debt to GDP Ratio a good explanatory of country risk?

The Debt to GDP ratio is often taken as a measure to explain the risk rating associated with the Sovereign rating for that country. In this article we attempt to shed light on other explanatory variables for Sovereign ratings other than Debt to GDP ratio. Debt to GDP ratio of a country is a very important variable that determines the country’s Sovereign risk rating as it reflects the Country’s ability to service its debt. However, for lower income countries the...

Could Private debt be the new theme for SMEs to access capital?

The global financial crisis has been the turnaround for the private debt market as it is now widely accepted as an asset class of its own. The increase in both supply and demand is having a significant impact on how alternative lending funds are being used. In recent years, there has been an influx of new entrants and greater diversity of investment strategies. The banking industry is forced to re-evaluate less-profitable and high-risk sectors, which has resulted in private debt...