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Saudi Financing Initiatives Seek to Earmark 20% of Lending Program to SMEs

Saudi Arabia’s development funds announced a set of initiatives to alleviate the repercussions of the Corona pandemic on SMEs. (Asharq Al-Awsat)
Saudi Arabia’s development funds announced a set of initiatives to alleviate the repercussions of the Corona pandemic on SMEs. (Asharq Al-Awsat)
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Saudi Financing Initiatives Seek to Earmark 20% of Lending Program to SMEs

Saudi Arabia’s development funds announced a set of initiatives to alleviate the repercussions of the Corona pandemic on SMEs. (Asharq Al-Awsat)
Saudi Arabia’s development funds announced a set of initiatives to alleviate the repercussions of the Corona pandemic on SMEs. (Asharq Al-Awsat)

Saudi Arabia’s development funds have announced measures to support government initiatives to alleviate the economic impact of the coronavirus pandemic, with the SMEs and the medical sector receiving a great share.

The Kingdom launched initiatives to support small and emerging projects, with the aim to earmark 20% of the lending portfolio to this segment, at a value amounting to 118 billion riyals ($31.5 billion).

The National Development Fund recently announced programs worth 22 billion riyals ($5.8 billion) in support of development priorities and economic needs within the urgent initiatives announced by the government to face the consequences of the novel coronavirus.

Saeed Al Zahrani, Assistant Director General of the Social Development Bank (SDB), said the Kingdom was planning to support small and emerging projects within the framework of a portfolio of 118 billion riyals. His remarks came during a virtual session held in Riyadh on Thursday, to reveal financing initiatives in support of the SMEs.

For his part, Ahmed Al-Gwaiz, Vice President of the Saudi Industrial Development Fund (SDIF), said that the priority in programs and initiatives focuses on essential activities, especially the medical sector and health supplies.

He emphasized that the SDIF vision was to maintain the sustainability of those projects after the end of the pandemic.

Gwaiz underlined that the Fund was seeking to finance 40 projects in the medical sector. Requests for three projects have been implemented to date, at a value of 150 million riyals, while other requests are being considered, he said.

Bader Almalik, Vice President of the Saudi Agricultural Development Fund, announced the postponement of installments for 4,000 beneficiaries until September, in order to support their work during the current period.

He also revealed initiatives to stimulate SMEs through operating and indirect loans amounting to 300 million riyals.

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IMF Approves Third Review of Sri Lanka's $2.9 Bln Bailout

Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage
Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage
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IMF Approves Third Review of Sri Lanka's $2.9 Bln Bailout

Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage
Peter Breuer, Senior Mission Chief for Sri Lanka at the IMF along with Katsiaryna Svirydzenka, Deputy Mission Chief for Sri Lanka at the IMF and Martha Tesfaye Woldemichael, Deputy Mission Chief for Sri Lanka at the IMF, attend a press conference organized by the International Monetary Fund (IMF) in Colombo, Sri Lanka, November 23, 2024. REUTERS/Thilina Kaluthotage

The International Monetary Fund (IMF) approved the third review of Sri Lanka's $2.9 billion bailout on Saturday but warned that the economy remains vulnerable.
In a statement, the global lender said it would release about $333 million, bringing total funding to around $1.3 billion, to the crisis-hit South Asian nation. It said signs of an economic recovery were emerging, Reuters reported.
In a note of caution, it said "the critical next steps are to complete the commercial debt restructuring, finalize bilateral agreements with official creditors along the lines of the accord with the Official Creditor Committee and implement the terms of the other agreements. This will help restore Sri Lanka's debt sustainability."
Cash-strapped Sri Lanka plunged into its worst financial crisis in more than seven decades in 2022 with a severe dollar shortage sending inflation soaring to 70%, its currency to record lows and its economy contracting by 7.3% during the worst of the fallout and by 2.3% last year.
"Maintaining macroeconomic stability and restoring debt sustainability are key to securing Sri Lanka's prosperity and require persevering with responsible fiscal policy," the IMF said.
The IMF bailout secured in March last year helped stabilize economic conditions. The rupee has risen 11.3% in recent months and inflation disappeared, with prices falling 0.8% last month.
The island nation's economy is expected to grow 4.4% this year, the first increase in three years, according to the World Bank.
However, Sri Lanka still needs to complete a $12.5 billion debt restructuring with bondholders, which President Anura Kumara Dissanayake aims to finalize in December.
Sri Lanka will enter into individual agreements with bilateral creditors including Japan, China and India needed to complete a $10 billion debt restructuring, Dissanayake said.
He won the presidency in September, and his leftist coalition won a record 159 seats in the 225-member parliament in a general election last week.