Middle East & Africa ABS Market Outlook

the middle east and africa (mea) abs market is characterized by a mature outlook with potential for moderate global growth from 2018 to 2032. the market has seen several recent developments including the emergence of more structured securitization vehicles as well as an increased focus on structuring innovative products. furthermore, the shift towards digital-only payments, such as those related to mobile commerce, is further opening up new possibilities for structuring debt. though the region has a deep pool of funds, developing and issuing securitizations remain challenging due to unusually high transaction costs as well as the prevalence of technological and operational differences across countries. this is currently being addressed through the use of standardized guidelines as well as technology-based initiatives that are intended to reduce these inefficiencies. in terms of outlook, the mea abs market is likely to remain largely start-up led, with the issuers being primarily venture funds. the majority of issuance is expected to take the form of technology-related abs securities. issuance activity is also expected to grow, particularly related to technologies such as mobile commerce, which is increasingly allowing the structuring of distinctive and tailored notes. regulatory reforms by a number of regional governments have improved fee structure and cost transparency while also making the issuance process easier. this is expected to further drive the volume of abs securities in the coming years. furthermore, the issuance of abs securities can also improve credit ratings of the issuer, offering a potential pathway for further fundraising. in the medium-term, there is also significant growth potential in the region’s green bond market and technology locks that can be utilized to secure digital assets. the rise in renewable energy production in the region adds to opportunities as there is an increasing demand for financing of clean energy projects. overall, these developments create a positive outlook for the mea abs market from 2018 to 2032.