Saudi Arabia has been added to J.P. Morgan’s Government Bond Index – Emerging Markets (GBI-EM) watchlist, a change expected to draw initial foreign inflows of about SAR 18.75 billion ($5 billion) into the country’s sukuk and debt capital market.
The Saudi Exchange said the move will strengthen liquidity and increase appeal to international investors. The kingdom’s sukuk and debt capital market saw a 25% year-on-year rise in foreign investment during the second quarter of 2025.
Total value of sukuk and debt traded on the Saudi Exchange stood at SAR 688 billion ($183 billion).
Major issuances in September tied to Saudi Arabia’s Vision 2030 programme have made the country one of the leading issuers in the region, whether sovereign, corporate or financial institutions.
Analysts say inclusion in the index watchlist follows ongoing reforms in Saudi Arabia’s debt capital market, including regulatory improvements, infrastructure, and operational changes that reduce friction for foreign participation.
The kingdom remains among the top issuers in the Gulf region. While debt issuance in H1 2025 dropped nearly 20% year-on-year, Saudi Arabia still raised about $48 billion via bonds and sukuk, more than half of the amount issued across GCC states in that period.
In parallel, foreign currency sukuk issuance globally is expected to reach between $70–80 billion in 2025. Saudi Arabia accounted for about 39%of that total in the first half of the year, and local banks in the kingdom are expected to issue over $30 billion through sukuk during 2025.
The inclusion in J.P. Morgan’s index watchlist is not guaranteed to translate immediately into full index inclusion, which would happen only after certain criteria are met regarding trading volume, regulatory standards, and operational procedures. But market participants expect that once included, Saudi Arabia will see greater foreign portfolio flows, lower relative borrowing costs, and enhanced global visibility for its debt securities.
