Saudi export financing grows while trade deficit widens

Alamy via Reuters

• Export financing up 128%
• Total awards over $4bn
• Trade deficit above 40%

Credit facilities for Saudi Arabian exporters surged in the first half of 2024 as the kingdom aimed to curb its non-oil trade deficit.

The Saudi Export-Import Bank awarded SAR16.3 billion ($4.3 billion) in financing and insurance during the first six months of this year, an increase of 128 percent year on year, the state-owned Saudi Press Agency reported.

The bank said Saudi export financing disbursements reached SAR7 billion over the period, a year-on-year increase of 142 percent, while export credit insurance amounted to SAR9.3 billion, a 118 percent rise compared with the previous year.

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The latest international trade figures, published in July by the General Authority for Statistics, showed that non-oil exports, including re-exports, increased by 8.2 percent year on year in May.

This is despite the ratio of non-oil exports (including re-exports) to imports increasing to 41 percent in May 2024, from 39 percent in May 2023, as the non-oil trade deficit gap widened.

The biggest non-oil export sector in the country was chemical products, which accounted for 24 percent of the total and reported 6 percent year-on-year growth.

Plastics and rubber products ranked second, accounting for 22 percent of total non-oil exports.

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The main market for non-oil exports remained China, accounting for 15 percent of goods, followed by South Korea (10 percent) and India (8 percent).

China was also the main import market, accounting for 25 percent of goods coming into the kingdom in May 2024, followed by the US (9 percent), and the UAE (6.5 percent).