The Project Support Fund of Saudi Arabia has signed an agreement with Tadawul, the kingdom’s stock exchange, to provide listed companies with long-term loans in an attempt to fuel economic growth and encourage further listings.
According to a statement by the Ministry of Finance of the Kingdom, the fund will provide financing options for private sector companies in the healthcare, education and real estate industries under the deal.
“The agreement contributes to bolstering the increase of financing limits for the listed companies in projects in the sectors that the Projects Support Fund Initiative targets, in order to encourage these companies to create new projects in the targeted sectors and to encourage unlisted companies to become listed,” it added.
The agreement was signed by Fahad Al-Saif, chief executive of the National Debt Management Centre and Khalid Al-Hussan, chief executive of the Saudi Stock Exchange.
The Projects Support Fund, which is supervised by the Ministry of Finance, focuses on providing financing to select sectors. It was set up as part of the kingdom’s economic stimulus measures with initial capital of $2.67 billion.
Support for recovery
Saudi Arabia has introduced various stimulus measures to cushion the economy from the impact of the coronavirus pandemic. Last year, the Arab world’s second-largest economy unveiled 142 stimulus initiatives worth $57.04 billion to provide support amid the pandemic.
In November, the Saudi Central Bank extended its loan deferral program until the end of the first quarter of 2021 in an effort to assist affected businesses.
The regulator said the decision would allow it to continue to empower the financial sector to play its role in supporting micro, small and medium enterprises, contribute to economic growth and maintain employment in the private sector.