Emerging market nations, with Saudi Arabia at the forefront, exhibit prominent dollar bond issuances during the first half of the year, according to Fitch Ratings reports.

In the first half of 2025, Saudi Arabia took the lead in the Gulf Cooperation Council (GCC) region's primary debt market, raising a significant $47.93 billion through 71 bond and sukuk issuances. This notable growth was driven by large financing needs, diversification goals, and upcoming maturities.

Saudi Arabia accounted for 52.1% of the total GCC issuances, cementing its position as the region's dominant fixed income market. The kingdom's state Sukuk issuance also saw a notable size compared to other countries, though exact comparative figures are not provided in the available data.

The GCC debt capital market reached over $1 trillion in outstanding volumes during the first half of 2025. Issuers from the GCC region, along with Malaysia, Indonesia, and Turkiye, accounted for just over half of US dollar debt issuance from emerging markets in the same period.

Sukuk, Shariah-compliant financial instruments, accounted for 13.7% of all emerging market dollar debt issuance. In the case of Saudi Arabia, sukuk made up most of the outstanding DCM at 61.1%.

The UAE's growth in the debt market will be driven by funding diversification and the implementation of the Dirham Monetary Framework. Modest growth is expected in Turkiye during the final six months of 2025.

Debt issuance in the second half of 2025 will be supported by a lower oil price and further interest rate declines. However, risks persist from US tariffs, geopolitical and capital market volatility, and for sukuk, Shariah-compliance complexities.

Looking ahead, emerging market liquidity conditions have improved since US tariff plans were announced in April 2025. Kamco Invest noted in December that the Kingdom of Saudi Arabia would lead the GCC region in bond maturities over the next five years, with about $168 billion in Saudi bonds expected to mature between 2025 and 2029.

The Saudi DCM is expected to grow due to ambitious government projects under Vision 2030, deficit funding, and diversification efforts. This expansion in the Saudi debt market, which has grown rapidly in recent years, positions the kingdom well for continued growth and leadership in the GCC debt market.