Wednesday, Aug 10, 2022
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Coronavirus: Saudi Arabia plans $13.3 bn stimulus for private sector

Saudi funding
UAE announces its own $27.2 bn stimulus and Egypt allocates $6.4 bn

Saudi Arabian Monetary Authority (SAMA) has unveiled a $13.3 billion funding package to support the private sector in the Kingdom of Saudi Arabia. The announcement came after the UAE launched a $27.2 billion programme to support its lenders, media reports said.

Egypt also plans to allocate $6.4 billion on the back of the coronavirus outbreak. SAMA’s package will help small and medium-sized enterprises combat the economic impact as a result of the outbreak.

SAMA’s funding is anticipated to grant SMEs six-month postponement on financial commitments such as bank payments and concessional. That said, they will be given exemptions from the costs incurred from loan guarantee programme, media reports said.

The UAE’s Targeted Economic Support Scheme comprises aims to support banks in the country through collateralised, zero-interest loans. The regulator said in a statement “The purpose of the targeted scheme is to facilitate provision of temporary relief from the payments of principal and interest on outstanding loans for all affected private sector companies and retail customers in the UAE.”

SAMA is the Kingdom’s central bank and it will oversee the banking sector’s performance. In fact, as part of its recently unveiled package, 30 billion riyals is available to banks and financing companies. This is in return for postponing loan payments for small and medium sized enterprises.

According to the regulator, the UAE banks have sufficient capital and maintain significant voluntary capital buffers.

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