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Saudi Arabia Spends USD125 Bn in First Half of 2020

A man counts Saudi Riyal banknotes in a jewelry store story in Riyadh, Saudi Arabia, October 18, 2017. (Reuters)
A man counts Saudi Riyal banknotes in a jewelry store story in Riyadh, Saudi Arabia, October 18, 2017. (Reuters)
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Saudi Arabia Spends USD125 Bn in First Half of 2020

A man counts Saudi Riyal banknotes in a jewelry store story in Riyadh, Saudi Arabia, October 18, 2017. (Reuters)
A man counts Saudi Riyal banknotes in a jewelry store story in Riyadh, Saudi Arabia, October 18, 2017. (Reuters)

Saudi Arabia spent SAR468 billion (USD125 billion) during the first half of 2020, according to a statistical document obtained by Asharq Al-Awsat.

Total contracts secured via Etimad reached 57,600 with a value of over SAR84 billion (USD22.4 billion). Total contracts for the same period last year reached SAR167 billion.

According to the document, users of Etimad reached 103,000 by the end of the first half of 2020, a 43 percent rise, compared to 72,500 during the same period of last year.

Competitions for the first half of 2020 increased to 13,700, or 57 percent, compared to the first half of 2019. Calls for direct purchasing dropped to 55,300, or 24 percent, compared to the first half of last year.

Separately, lender HSBC arranged a USD258 million export credit agency (ECA) loan for Saudi Arabia’s Ministry of Finance. HSBC acted as a mandated lead arranger (MLA), an original lender, and the agent bank for the loan, which is the first Green ECA loan in the Kingdom.

The proceeds of the loan are being used to purchase buses from Germany for the Kingdom’s public transport network. The buses will help reduce greenhouse gas emissions and air pollution, as well as alleviate traffic congestion in Riyadh through a shift towards public transportation.

The use of proceeds and reporting features of the facility deems it compliant with the “Green Loan Principles”, published by the Loan Market Association on March 21, 2018, a statement read.

The loan has also received support from the official ECA of the Federal Republic of Germany. Loans backed by ECAs are popular with regional borrowers as a means of diversifying their funding sources while securing attractive financing terms.

Gareth Thomas, HSBC’s head of global banking, Middle East, North Africa, and Turkey, said: “Saudi Arabia is embarking on one of the world’s most ambitious economic transformation programs and by securing its first-ever Green ECA financing it has once again demonstrated its regional leadership in debt markets. HSBC was delighted to play a part in another important milestone for the Kingdom.”

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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.