The Saudi Fund for Development (SFD) has signed a US$50mn financing agreement with the Trade Bank of Iraq to facilitate Saudi exports to the country in an effort to support non-oil exporters.
The SFD’s statement does not identify which sectors will benefit from the funding, which was signed on March 31, or what form of support it will take. Representatives of the fund did not respond to messages seeking further details.
The fund’s statement says the benefits of the agreement to Saudi Arabia include “growing and developing the non-oil national exports of goods and services” and “providing Saudi exporters with confidence to enter new markets”.
In turn, Iraq will benefit from receiving “high-quality, competitively-priced Saudi products” and stimulation of the “financial and trade sectors”.
According to the conditions placed on SFD financing, goods and services exports that draw on export credit or insurance provided by the fund must have local added value of at least 25%.
The SFD focuses on providing loans and technical help to projects in developing countries while also serving local exporters. A large share of the countries in which it is active are in Africa.
Last year the kingdom’s first export credit agency began operations with a mandate to diversify the economy and focus on helping Saudi exporters.