MIDDLE EAST & TURKEY
Oman plans to issue between US$1.5bn to US$2bn of bonds internationally in 2017 to plug a deficit caused by low crude prices. It will follow the largest Arab non-OPEC oil producer’s US$2.5bn issuance in June and an additional US$1.5bn bond in September.
Royal Dutch Shell Plc and Total SA are finalizing plans to develop oil and gas fields in Iran, becoming first European entities to venture in the Gulf states since sanctions eased earlier this year. Paris-based Total signed a US$4.8bn accord last month to develop an Iranian gas project, while a host of Russia oil and gas companies, including Rosneft, Gazprom Neft, Zarubezhneft, Gazprom and LUKoil, are also circling the Iranian market, according to Russia’s Energy Minister.
Zambia plans to refinance Eurobonds totalling around US$2.8bn, which amounts to equivalent of 19% of the country’s GDP. Zambia’s Finance Minister Felix Mutati said on Wednesday that it plans to reduce that figure to around 15%, with the extra resources to be used to support the most vulnerable. The African state issued a US$750mn Eurobond in 2012 followed by another amounting to US$1bn in 2014 and finally another US$1.25bn last year, most of which went towards financing infrastructure projects.
Mauritius expects foreign direct investment to reach MUR14bn (US$391mn) in 2016, up more than 44% from last year, the island nation’s finance minister said on Tuesday. According to Bank of Mauritius data, in the first three quarters of 2016 foreign investment inflows came to MUR10.6bn, up 46.8% year-on-year, driven by real estate, financial services and insurance activities.
Investors are flocking to the new US$5.5bn bond from Mexican state-owned oil giant Petroleos Mexicanos (Pemex), the first dollar deal from a Latin American borrower since November 10. Pemex's bonds rallied on Monday, attracting US$30bn of orders after the company announced a partnership with BHP Billiton over new oil field development.
Mexican peso rose 1.3% to reach 20.33 per dollar, marking its third straight day of gains. After the Turkish lira, the peso was the second best-performing EM currency, after weeks of depreciation in the aftermath of Donald Trump’s election, which made the peso one of the weakest performers among the world’s currencies.
Italy’s Enel is hoping to borrow US$111mn from two banks to finance renewable projects in Brazil. It follows the Italian company’s purchase of the Brazilian power distribution company Celg-D from the state-run power holding company Eletrobras in November, as part of a strategic drive to expand in Latin America.
India’s Central Bank kept interest rates unchanged before a possible increase in U.S. borrowing costs this month, defying market expectations that were based on the growing cash shortage following last month’s demonetisation. The benchmark repurchase rate will stay at a six-year low of 6.25%, the Reserve Bank of India said in a statement in Mumbai on Wednesday.
China’s foreign currency reserves, the world’s largest, fell the most since January as the yuan declined to an eight-year low. Reserves decreased US$69.1bn to US$3.05tn in November, the People’s Bank of China said in a statement Wednesday.
RUSSIA, CIS & EUROPE
Russian Railways (RZD) on Wednesday launched the book-building for its 15-year RUB15bn local bond, with VTB Capital, Gazprombank and Sberbank acting as organizers. The company cut its initial 9.4-9.6% guidance to 9.3–9.4%, which corresponds to a yield of 9.52–9.62% to a 3-year buyback offer.
Russia’s president Vladimir Putin was directly involved in the country’s decision to comply with the OPEC agreement to cut production, the Kremlin spokesman Dmitry Peskov announced. According to Peskov, Putin’s directives to Russia’s biggest companies are based on the agreement reached during last week’s negotiations between OPEC and non-OPEC oil producers. He added that, contrary to reports, the state will not be compensating the oil companies for the revenue loss.
Georgia's FX reserves rose to US$2.779bn in December, from US$2.76bn a month earlier, the country’s Central Bank said on Wednesday. The central bank was forced to sell US$240mn on the foreign exchange market to support the lari, but also bought US$278.35mn this year.