Saudi Arabia’s non-oil industries received a strong boost with the announcement that Crown Prince Abdullah had approved a Saudi Fund for Development (SFD) decision to allocate SR15 billion ($4 billion) to underwrite credit facilities for the sector.

Finance Minister Dr Ibrahim Al-Assaf, chairman of SFD, said the new resources would be used to provide credit facilities to finance national exports.
“This will definitely help Saudi exports,” said economist Dr Ihsan Bu-Hulaiga. “The goal is to diversify the country’s economic resources by promoting non-oil exports. This has been the aim of the latest development plans and we have seen a 10 per cent increase in non-oil exports during the past few years,” Bu-Hulaiga was quoted by the Saudi press as saying.
Al-Assaf said the Saudi Export Programme (SEP) began offering its services to non-oil national exports four years ago. More than 300 Saudi exporters have so far registered with SEP, which approved finances and guarantees worth SR2 billion to importers of Saudi products in more than 30 countries in Asia, Africa, North America, Europe and Australia.
These exports so far include petrochemicals, plastics, agricultural equipment, construction products and equipment, metallic products and food items, the minister said.
Al-Assaf said the SFD was working hard to increase the size of national exports. “In addition to its direct role of financing and guaranteeing exports, the fund has signed several cooperation agreements with banks, companies and international institutions for financing and guaranteeing Saudi exports,” he explained.
Some of the institutions the SFD signed agreements with include Arabian Investment Company, Inter-Arab Investment Guarantee Corporation, Arab Monetary Fund, Islamic Development Bank, the Saudi-Sudanese Bank, El-Neelain Industrial Development Bank, Omdurman National Bank, Khartoum Bank, Export and Finance Bank in Jordan, Yemen’s National Commercial and Investment Bank, Algerian National Bank, Tunisia’s Al-Aman Bank, the Byblos Bank in Lebanon and the Central Bank of Iran, the report added.
Al-Assaf urged agencies, which have not yet registered to join the programme and benefit from its services. “Our current exports of petrochemicals, food products, plastic and others have earned a good reputation in the countries they are being exported to,” Bu-Hulaiga said.
Even though many of the industries and products were oil-based, Bu-Hulaiga pointed out that being oil-based gave industries a competitive advantage and the ability to expand into such industries as refining.
“This programme is necessary to bolster our competitive ability abroad and with the approaching date of joining the World Trade Organisation it will improve and support our products’ competitiveness,” he said.
In addition, he said the expansion in industries would create more job opportunities, but it would need human resources, better administrative skills and methods. “I think the private sector would benefit a lot from the programme and the private sector is always seeking to increase its exports. What the fund and the programme can do is not only provide financing but also provide what is called ‘soft infrastructure’ such as information and easier procedures.”
He suggested transforming the programme into an independent authority to provide complete services and support, financial and otherwise.
 “Saudi exporters might be small now, but by increasing their awareness of how to reach markets and produce quality products they can develop and compete, and this would need a competent administrative crew,” he said.