The Gulf Cooperation Council remained the largest contributor to emerging-market US dollar ESG debt issuance during the first nine months of 2026 (9M26), accounting for about 39% of the total excluding China, Fitch Ratings reported. Total emerging-market US dollar ESG debt issuance excluding China reached around $15 billion in 9M26, marking a 40% year-on-year drop. Saudi Arabia and the UAE led all emerging markets, representing 20.9% and 17.8% of volumes respectively, followed by Brazil (15.9%), India (12.5%), and Türkiye (11.7%).
Total outstanding ESG debt across the GCC reached more than $72.9 billion at the end of the third quarter of 2026, an 18% increase year-on-year. Sukuk comprised 43% of this total, supported by steady demand from regional Islamic banks. By currency, US dollars accounted for 86% of outstanding GCC ESG debt, while euros made up 12%. Fitch noted that 91% of all euro-denominated debt issued in the GCC during 3Q26 was in ESG format, up from 76% in 2025.
Overall GCC ESG issuance across all currencies reached about $8 billion in 9M26, down 44% year-on-year due to weaker debt capital market activity linked to the Iran conflict. Issuance was entirely concentrated in two markets: the UAE, which accounted for 61%, and Saudi Arabia, which accounted for 39%. Issuance performance diverged, with UAE ESG debt issuance growing 12% year-on-year, whereas Saudi issuance fell by 66%. Commercial banks represented the majority of regional activity.
Fitch stated that GCC ESG debt volumes are expected to expand in 4Q26 and 2027, underpinned by government sustainability agendas, transition targets, and funding diversification efforts, though regional geopolitical volatility remains a downside risk.
Sources
- Gulf Daily News (Bahrain) · 2026-10-20
- Google News — UAE China technology & trade · 2026-10-20
