Saudi Arabia meets with banks about export credit financing schemes, according to sources

Informed sources said that Saudi Arabia will be discussed soon with the international banks their plans to use export credit agencies in other states to assist in the financing of infrastructure projects.
I proceeded to Saudi Arabia in an ambitious plan of economic development that includes infrastructure projects worth billions of dollars, in areas ranging from housing and transportation.
But it has collected almost $ 60 million of debt in a little over two years, and this does not include funding associated with infrastructure projects.
In January last year, said the Office of debt management in the country, he asked banks to submit proposals for funding potential is supported by export credit agencies (ECA). These agencies provide loan guarantees and sometimes finance to encourage trade and reduce international business costs.
Some Saudi entities have already used this funding. Last year, Aramco, the state-owned oil company, signed a $ 2 billion line of credit with British export finance, the British European Economic Commission.
But after more than a year on the request for proposals, the government has not appointed a financial adviser, according to sources. Nor did he mention which specific projects would be supported by funding.
The debt management office did not respond to the request for suspension.
I spent the kingdom of Saudi Arabia billions of dollars on huge projects during the past decades, but the recession in construction and a delay of payments to contractors might stop existing developments. At the same time, low oil prices reduced the state budget.
For example, he began work in the King Abdullah Financial, costing $ 10 million dollars in wind, in 2006. However, it faced construction delays, cost overruns, and doubts about a preliminary economic feasibility study.
He said the kingdom last month it intends to begin development of the first area in Newman (Middle East) High-Tech that cost $ 500 million in the first quarter of 2019.
The sources said that the financing supported by the ECA can be useful for large projects similar to that required equipment, contractors, foreign in addition to the financing of cheap loans over long periods. But they added that the government has not yet begun any talks on financing backed by ECA for NEOM.
The government has taken some steps toward funding the project. Last November, the debt management office was appointed as an interim adviser at MUFG Hirofumi Sakioka Bank, a vice president of ECA Finance EMEA in MUFG Bank.
Sources said that his appointment was aimed at coordinating ECA funding requirements from various Saudi ministries.
About two years ago, the government requested the ministries review the unproductive projects worth billions of dollars with a view to its negligence or its restructuring.
Many of these projects are from the effects of an era of high oil prices, government spending, and lavish lifestyle, which ended when oil prices began to decline in mid-2014, making it difficult for wind to find the funds necessary to complete.