UAE boosts financial market with law permitting federal govt to issue debt

The UAE has no urgent need to issue federal debt

The United Arab Emirates has taken a major step towards deepening its financial markets by issuing a law permitting the federal government to begin issuing sovereign debt, the finance ministry said on Saturday.

Several of the seven emirates in the UAE, including rich Abu Dhabi and Dubai, already sell bonds in international markets.

Allowing the central government to issue could benefit the poorer emirates as federal bonds would carry higher credit ratings than those emirates could achieve individually.

Banks in the UAE will be able to buy government bonds in dirhams or foreign currencies, giving them highly-rated assets with which