ANNOUNCEMENT 23 Nov 2015

On 23 November 2015, the Saudi Fund for Development (SFD), signed a financing agreement with Alwaha. The financing agreement is part of SFD's Saudi Export Program (SEP) and contains a local sourcing requirement.

NUMBER OF INTERVENTIONS

2

  • 2 harmful
  • 0 neutral
  • 0 liberalising

SOURCE



The Saudi Fund for Development, press release of 23 November 2015; SFD Signs SR (262.5) Million Financing Agreement with ALWAHA Petrochemical Company: http://www.sep.gov.sa/webcenter/faces/oracle/webcenter/page/scopedMD/s5dc73d77_7324_4d08_b347_444721019cba/Page30.jspx?NRow=3&_afrLoop=383311903906533&wc.originURL=%2Fspaces%2Fsfdinternet%2Fpage%2FLatest%2BNews&DFile=SEP_ACCORDION_DATAFILE&wc.contextURL=%2Fspaces%2Fsfdinternet&_adf.ctrl-state=nazuebmo7_4818#%40%3FNRow%3D3%26_afrLoop%3D383311903906533%26wc.originURL%3D%252Fspaces%252Fsfdinternet%252Fpage%252FLatest%252BNews%26DFile%3DSEP_ACCORDION_DATAFILE%26wc.contextURL%3D%252Fspaces%252Fsfdinternet%26_adf.ctrl-state%3D19c0dvns21_394

The Saudi Fund for Development, annual report 2015, page 58: http://www.sfd.gov.sa/cs/groups/public/documents/document/mdaw/njez/~edisp/121-document-613563.pdf

The Saudi Export Program, Introduction: http://www.sep.gov.sa/webcenter/faces/oracle/webcenter/page/scopedMD/s496069c3_e35f_448c_8a0a_0c2ed8086bcf/Page2.jspx?wc.contextURL=%2Fspaces%2Fexportprogram&DFile=SEP_PROJECT_DATAFILE&NRow=0&wc.originURL=%2Fspaces%2Fexportprogram%2Fpage%2FFORWARD&_afrLoop=279550133356624#%40%3FNRow%3D0%26_afrLoop%3D279550133356624%26wc.originURL%3D%252Fspaces%252Fexportprogram%252Fpage%252FFORWARD%26DFile%3DSEP_PROJECT_DATAFILE%26wc.contextURL%3D%252Fspaces%252Fexportprogram%26_adf.ctrl-state%3Dnazuebmo7_2622

The Saudi Fund for Development, What IS SFD?: http://www.sep.gov.sa/webcenter/faces/oracle/webcenter/page/scopedMD/s5dc73d77_7324_4d08_b347_444721019cba/Page2.jspx?wc.contextURL=%2Fspaces%2Fsfdinternet&wc.originURL=%2Fspaces%2Fsfdinternet%2Fpage%2FWhat%2Bis%2BSFD&_afrLoop=276574034869471#%40%3F_afrLoop%3D276574034869471%26wc.originURL%3D%252Fspaces%252Fsfdinternet%252Fpage%252FWhat%252Bis%252BSFD%26wc.contextURL%3D%252Fspaces%252Fsfdinternet%26_adf.ctrl-state%3Dnazuebmo7_2174

The Saudi Export Program, Eligible parties for SEP benefits: http://www.sep.gov.sa/webcenter/faces/oracle/webcenter/page/scopedMD/s496069c3_e35f_448c_8a0a_0c2ed8086bcf/Page12.jspx?_afrLoop=262217691043248&wc.originURL=%2Fspaces%2Fexportprogram%2Fpage%2FELIGIBLE%2BPARTIES%2BFOR%2BSEP%2BBENEFITS&wc.contextURL=%2Fspaces%2Fexportprogram&_adf.ctrl-state=wivj9vjgj_1467#%40%3F_afrLoop%3D262217691043248%26wc.originURL%3D%252Fspaces%252Fexportprogram%252Fpage%252FELIGIBLE%252BPARTIES%252BFOR%252BSEP%252BBENEFITS%26wc.contextURL%3D%252Fspaces%252Fexportprogram%26_adf.ctrl-state%3Dnazuebmo7_1111


Inception date: 23 Nov 2015 | Removal date: open ended
Still in force

Trade finance

The financing agreement btween the SFD and the petrochemical company Alwaha is worth SAR 262.5 million (approx. 70 million) and will finance the company's exports of petrochemicals. According to the SFD 2015 annual report, the financing agreement is part of the fund's Saudi Export Program (SEP). It is granted under the Saudi Export Program. The Saudi Export Program (SEP) is part of the Saudi Fund for Development and was established in 1999. The program promotes Saudi exports to contribute the country’s GDP and minimize the economic dependence of crude oil. In promoting export of Saudi goods the SEP can support 100% of the value of the eligible export transaction depending on risk and nature of the export. Parties benefiting from the SEP fall into one of the following: Saudi companies and establishments; foreign companies, entities or governments importing or purchasing of Saudi goods or services; or lastly local or foreign banks and financial institutions. According to the Saudi authorities the “SEP has made good achievements by being able to approve export funding and guarantee facilities supporting about SAR 39 Billion (equivalent to US$ 10.4) Billion worth of exports reaching to about 68 countries. Such facilities include direct funding operations amounting to SR (12.7) Billion (ed. approx. USD 3.39 billion). In addition to that, the program has opened lines of credit with several foreign banks amounting to SR (3.5) million (ed. approx. USD 0.93 million).” The Saudi Fund for Development (SFD) was established by Royal Decree No. M/48 of 1 September 1974. The Fund’s main objectives are to: “participate in financing of development projects in developing countries through granting of loans to said countries and to encourage national non-crude-oil exports by providing finance and insurance in support of such exports.

AFFECTED SECTORS

 
Inception date: 23 Nov 2015 | Removal date: open ended
Still in force

Local sourcing

According to the terms of the SFD, the goods and services exported within this transaction must contain a Saudi domestic value of 25% or more.

 
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