Need to Stimulate the Entire Financial Sector: Umar Farooq

The security introduction ought to start the society development all across the secondary market for the local currency debt. The strategy of public debt as introduced by the United Arab Emirates will have a huge impact on the global competitiveness standards of a nation and also, make improvements in the macroeconomic and management, said Umar Farooq Zahoor.

Umar Farooq Zahoor

Sheikh Umar FarooqZahoor said that the strategies of the debts that need to develop the market of UAE for local currency bonds would be helpful to stimulate the financial as well as banking sector too. Also, it provides some set of financial alternatives to all the projects run by the government and sets up a bond market in local currency.

This strategy gives full support to the emirates to attain all competitive economy and improve the financing for the federal, said Farooq. He also explained the foundation of the public debt with the help of this approach and accomplish financial stability by increasing confidence in investors across the national economy. It contributes to enhancing and strengthening the nation’s standing across the global opportunities indices to become the best nation in the world by the Centennial 2017 of the UAE.

The government of the United Arab Emirates does not issue any debt but the individual taps the bond markets. For the last two years, the federal government has been placing the infrastructure to issue all the dirhams debt as denominated.

Umar Farooq Zahoor said that the Central Bank of the United Arab Emirates also mentioned in December that they will begin to issue dirham denominated securities and is known as M-Bills in January. It has also been said that the intro of securities may lead to secondary market development and it may result in the creation of benchmarking that is free from all risks for dirham denominated debt for a long period.

As per Umar FarooqZahoor, being an investor, a local bond market goes a long way in strengthening the financial markets of the UAE, attracting the long-term flows of portfolios, and increasing options for monetary policies. Also, they said that the creation of such a local bond market can take the financial stability of the nation to the next level. The introduction of these securities results in stimulating the entire financial sector and give them a strong boost at first.

Umar explained how these securities will be advantageous for the financial sector of the UAE.

https://twitter.com/farooqzahoor_

https://umar-farooq-zahoor.blogspot.com/

 

Location: Dubai - United Arab Emirates

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