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Saudi Arabia: SIDF Allocates $3.6 Bn to Develop Industrial Sector

During SIDF’s ceremony “Empowering the Private Sector” (Yazid al-Samrani)
During SIDF’s ceremony “Empowering the Private Sector” (Yazid al-Samrani)
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Saudi Arabia: SIDF Allocates $3.6 Bn to Develop Industrial Sector

During SIDF’s ceremony “Empowering the Private Sector” (Yazid al-Samrani)
During SIDF’s ceremony “Empowering the Private Sector” (Yazid al-Samrani)

Saudi Industrial Development Fund (SIDF) unveiled a new set of financial services and products that will enable the Saudi private sector to play its role in industrial development and logistics.

SIDF launched the new financial services and products under the slogan “Empowering the Private Sector” at the presence of a number of senior officials in government agencies and industry leaders from the private sector.

During the ceremony, it was revealed that $2.6 billion had been used to boost the industrial sector out of $3.6 billion allocated for 2019.

Minister of Industry and Mineral Resources, and SIDF Chairman Bandar al-Khorayef announced the amendment of the Fund's Articles, noting that this will enable it to expand its financing activity to include a number of promising new sectors.

In the past 20 years, the Fund approved 2,186 loans, with a total value of over $3.7 billion, while the proportion of small and medium-sized enterprises (SMEs) reached 81 percent of the total number of loans approved.

The total number of direct jobs provided by projects funded by the SIDF in the same period was more than 187,000 jobs, and the value of the contribution of projects funded by the Fund in Saudi Arabia’s industrial GDP reached $50 billion, said Khorayef.

The Minister added that the new financing products launched by the SIDF will assist the ministry in supporting the industrial and mining sectors.

Speaking on the sidelines of the ceremony, Khorayef indicated that the expansion of acquisitions to include new companies comes from new products, noting that for the first time, Saudi companies will be able to acquire companies characterized by creativity and research and development of new products to bring to the Saudi market.

The Minister said the industry and logistics development program is the largest of Vision 2030's programs.

Empowering its subsidiaries through the provision of financing instruments is consistent with the new system, which allows the Fund to be innovative without any limitations on new products.

Regarding National Industrial Development and Logistics Vision Realization Program (NIDLP), Khorayef said that the program targets $453.3 billion, adding that all programs will be constantly revised, considering the Vision has been set with certain data, especially as the economy changes.

For his part, SIDF CEO Ibrahim Saad al-Mojel announced the new package of financial services and products, which will help meet the needs and support the industrial sector.

Mojel said that the Fund has redesigned its internal procedures to reduce the processing time of existing and new loan applications to an average of 4 to 5 months, while maintaining the quality of provided studies and consultations.

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Dollar Tumbles as Investors Seek Safe Havens after US Tariffs

US Dollar banknote is seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
US Dollar banknote is seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
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Dollar Tumbles as Investors Seek Safe Havens after US Tariffs

US Dollar banknote is seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
US Dollar banknote is seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/Illustration/File Photo

The dollar weakened broadly on Thursday, while the euro rallied after President Donald Trump announced harsher-than-expected tariffs on US trading partners, unsettling markets as investors flocked to safe havens such as the yen and Swiss franc.

The highly anticipated tariff announcement sent shockwaves through markets, with global stocks sinking and investors scrambling to the safety of bonds as well as gold.

Trump said he would impose a 10% baseline tariff on all imports to the United States and higher duties on some of the country's biggest trading partners.

The new levies ratchet up a trade war that Trump kicked off on his return to the White House, rattling markets as fears grow that a full-blown trade war could trigger a sharp global economic slowdown and fuel inflation, Reuters reported.

The dollar index, which measures the US currency against six others, fell 1.6% to 102.03, its lowest since early October.

The euro, the largest component in the index, gained 1.5% to a six-month high of $1.1021.

Trump has already imposed tariffs on aluminium, steel and autos, and has increased duties on all goods from China.

"Eye-watering tariffs on a country-by-country basis scream 'negotiation tactic', which will keep markets on edge for the foreseeable future," said Adam Hetts, global head of multi-asset and portfolio manager at Janus Henderson Investors.

The risk-sensitive Australian dollar added 0.56% to $0.63365, while the New Zealand dollar climbed 0.9% to $0.5796.

The yen strengthened to a three-week high against the dollar and was last up 1.7% at 146.76 per dollar, while the Swiss franc touched its strongest level in five months at 0.86555 per dollar.

"Negotiations are now going to be front of mind. This is probably the other big part of why we're seeing some of these currencies outperform," said Nicholas Rees, Head Of Macro Research at Monex Europe.

"It's very difficult actually to see how other countries make concessions that would encourage the US to lift these tariffs. And I think that's a big underpriced risk."

Investors are worried that some US trading partners could retaliate with measures of their own, leading to higher prices.

EU chief Ursula von der Leyen described the tariffs as a major blow to the world economy and said the 27-member bloc was prepared to respond with countermeasures if talks with Washington failed.

Worries about a global trade war have intensified since Trump stepped into the White House in January, combining with a slew of weaker-than-expected US data to stoke recession fears and undermine the dollar.

The dollar index is down more than 5.7% this year.

"These tariffs have certainly significantly increased the risks to the downside for global growth, so on balance we think that will eventually start to become more supportive again for the dollar," said Lee Hardman, senior currency analyst at MUFG.

In Asia currencies, China's onshore yuan slid to its weakest level against the dollar since February 13. China's offshore yuan also hit a two-month low.

The Vietnamese dong slumped to a record low.

Elsewhere, the Mexican peso and Canadian dollar strengthened.

Canada and Mexico, the two largest US trading partners, already face 25% tariffs on many goods and will not face additional levies from Wednesday's announcement.