Tencent Financial News according to Bloomberg, HSBCBankIt is pointed out that with economic growth slowing, interest rates rising and the risk of rating downgrade, members of the Gulf Cooperation Council (Gulf Cooperation Council, hereinafter referred to as GCC) may need to refinance 94 billion in the next two years.dollarThe debt.

In the email report, oil-rich GCC members will have to refinance $52 billion through bond issues and receive $42 billion in "syndicated loans", mostly from the United Arab Emirates and Qatar. The so-called syndicated loan, that is, syndicated loan, refers to a number of banks and non-banks led by one or more banks approved to operate the loan business.FinanceA banking group with the participation of institutions shall adopt the same loan agreement and provide financing to the same borrower on agreed terms and conditions.

HSBC noted that GCC members will also face fiscal and current account deficits of up to $395 billion over the next two years.

Simon Williams, HSBC's chief economist for the Middle East, pointed out in the report that as GCC appears in the global credit market as a single credit market, the refinancing challenge is likely to be felt more broadly, accompanied by the risk of regional liquidity tightening, rising interest rates and credit rating downgrades.

The overall output of GCC members accounts for about 25 per cent of global crude oil output. Faced with the continued collapse in oil prices to their lowest level in 12 years, these countries have launched unprecedented measures aimed at reshaping their public finances. Some member states, including Saudi Arabia and Oman, have been plagued by a series of downgrades. Meanwhile, liquidity in the GCC financial system has shrunk by billions of dollars.

It is reported that on the 17th of this month, Standard & Poor's, an international credit rating service, downgraded Saudi Arabia's sovereign credit rating by two notches from "A +" to "A -". This is the second time that the agency has downgraded the OPEC's largest oil producer since October last year, as oil prices continue to fall. At the same time, S & P also downgraded the sovereign credit ratings of Oman, Kazakhstan and the Kingdom of Bahrain, citing falling oil prices. It downgraded Oman from "BBB+" to "BBB-", having previously downgraded once in November; Kazakhstan from "BBB" to "BBB-" with a "negative" outlook; and the Kingdom of Bahrain to "junk".

Sovereign debt

HSBC says the Gulf states have $610 billion worth of outstandingForeign exchange; foreign exchangeDenominated bonds and syndicated loans. This includes financial and corporate extraction, as well as sovereign debt, mainly from the United Arab Emirates, Bahrain and Qatar.

However, HSBC believes the funding gap among GCC members can be covered and expects them to finance their budget deficits through "substantial" foreign sovereign bond issuance. Any new debt issuance will have to contend with upcoming refinancing needs.

Nearly half of the debt due in the next two years comes from the banking sector, according to data released by HSBC. "this means that any upside in refinancing costs could lead to broader monetary tightening," the bank said. " (Mina)