Emirates Development Bank (EDB), the public lender focused on financing priority sectors in the United Arab Emirates, has increased financing for industrial companies by 418% in the first half of 2022 to stimulate growth in the sector.
The Abu Dhabi-based bank approved 2.4 billion dirhams ($653 million) in loans to the UAE’s industrial sector in the first six months of the year, up from 464 million dirhams the previous year, she said in a statement on Sunday.
The surge in industrial financing took the bank’s contribution to the UAE’s gross domestic product to 1.9 billion dirhams during the period, from 425 million dirhams in the first half of 2021.
EDB also more than doubled its loans to small and medium enterprises to Dh351 million in the first half of 2022 through its credit guarantee scheme, from Dh168 million allocated in 2021, it said.
The findings underscore the potential of the UAE’s industrial sector and the bank’s ability to mobilize finance to drive its expansion, said Dr. Sultan Al Jaber, Minister of Industry and Advanced Technologies and Chairman of the Board of Directors of the EDB.
“These results demonstrate the bank’s progress in supporting the UAE’s economic diversification agenda and increasing its global competitiveness,” Dr. Al Jaber said.
“By expanding access to capital, the bank is helping to develop a global hub for industry, advanced technology and the industries of the future.”
EDB finances companies in priority sectors, including healthcare, infrastructure, food safety and technology.
The lender works with state entities including the Ministry of Industry and Technology and free zones such as Dubai Industrial City, Jebel Ali Free Zone and Khalifa Industrial Zone in Abu Dhabi to provide financing to their clients.
Last year, the UAE launched its “Operation 300 Billion” industrial strategy to position the Arab world’s second-largest economy as a global industrial hub by 2031. The 10-year plan focuses on increasing the contribution from the industrial sector to the country’s GDP from 133 billion dirhams in 2021. to 300 billion dirhams in 2031.
The strategy aims to boost production in 11 priority sectors, support the growth of domestic industries, attract foreign investment and ensure the availability of dedicated financing for local industrial enterprises.
“Over the past period, we have worked tirelessly to strengthen our capability partnerships, share our vision with industry leaders, and cement our role in driving the national economy to greater heights and consolidating its pioneering position,” said Ahmed Al Naqbi, Managing Director of EDB. .
“As we look forward to the remainder of this year, we remain committed to providing a comprehensive business ecosystem for SMEs and start-ups.”
In the second half of 2022, EDB plans to use its assets in vital sectors and expand its digitization program across the bank, he said.
The EDB aims to increase its funding to 5 billion dirhams by the end of this year, Al Naqbi said in June.
In June last year, S&P Global Ratings affirmed its “AA-” credit rating with a “stable” outlook for EDB.
Updated: August 07, 2022, 11:07 a.m.