The UAE is working to pass a law establishing a government securities market by the end of the year, Central Bank Governor Sultan bin Nasser al Suwaidi said today.
In an interview in Abu Dhabi, al Suwaidi said: “The government needs a law that will enable it to borrow,” adding that legislation is in the final stages and should be approved by year end.
He also said that the law “will enable the government to issue t bills, bonds, sukuks.”
The UAE, like many emerging markets, has no domestic bond market. Abu Dhabi, the largest emirate, and neighboring Dubai have sold global bonds.
Al Suwaidi said: “The law will create a liquidity instrument that will carry, not the guarantee of the central bank, but assurances that the central bank will buy it for a certain price."
He added: “At the moment there is no such instrument.”