The demand for trade finance is rising in Saudi Arabia as the Kingdom’s non-oil exports hit 51,536 million riyals for the second quarter in 2013, an increase of 6.3 per cent in comparison to the same period the previous year
The Kingdom’s imports for the second quarter of 2013 also saw an increase of 11.2 per cent and amounted to 167,258 million riyals, in comparison to the same period last year as reported by the Saudi Press Agency.
“Saudi Arabia is emphasising on its industrial sector and plans to become a world leader in production of petrochemical and minerals. Imports and exports are expected to grow by 6.8 per cent and 5.5 per cent respectively over the next five years. With these factors in place, trade finance is expected to rise in demand with a continuing commitment from banks to support this rise.”
Some of the leading corporate companies, agencies and conglomerates of the largest economy in the Arab region all got together in Riyadh last December to discuss this promising future of trade finance and how the Saudi trade finance market is evolving.
According to Kailash Sadangi, CFO, Abdullah A.M. Al Khodari & Sons, “More banking reforms and removal of entry barrier for foreign banks and a greater GCC alliance will help usher the opportunity. Also, opening up the economy and the capital markets coupled with banking and financial institution reforms will improve our trade finance potential.”