- Reuters/Fahad Shadeed
Saudi Arabia has built up a massive amount of US debt.
The kingdom held $116.8 billion in US Treasurys as of March, according to a report from Bloomberg.
Saudi holdings of US federal debt have come under scrutiny in recent months after the kingdom said it would liquidate more than $750 billion worth of US Treasurys if Congress were to pass a bill allowing the families of terrorism victims to sue foreign countries. Such a law could potentially allow families of 9/11 victims to sue Saudi Arabia.
The number disclosed Monday falls well short of the threatened amount, but it may be undershooting the total, Bloomberg said. For instance, debt could be held by Saudi Arabia in financial instruments set up in other countries, so it would not show up on the Saudi balance sheet.
While there is some skepticism over whether Saudi Arabia would go through with the threat, the new information provides a clear picture of just how devastating the move would be for the US debt market.
In its monthly report of foreign holdings of US Treasurys, the Treasury Department has previously lumped in Saudi Arabia’s debt with that of other nations including Ecuador, Qatar, Venezuela, and Iraq. Most countries with high debt holdings are listed individually. As of February, the oil exporters held a combined $281 billion in US debt.
Stripping out Saudi Arabia’s debt from the oil exporters would make the kingdom the 13th-largest holder of Treasurys based on the February data, just behind India and ahead of Singapore.
The Treasury’s response Monday was in response to a Freedom of Information Act request, according to the Bloomberg report.