The Abu Dhabi Exports Office (Adex), the export financing arm of Abu Dhabi Fund for Development, is partnering with Japan’s Sumitomo Mitsui Financial Banking Corporation (SMBC) to provide $135 million worth of financing to global commodities trader Trafigura.
As part of the two-year financing deal, Adex will provide $125 million to support Trafigura’s working capital needs, including for exports of metals, minerals and refined hydrocarbons from the UAE, with SMBC financing the remaining $10 million, Adex said in a statement on Tuesday.
“The loan provided by Adex and SMBC would allow Trafigura to develop broader relations with Emirati exporters and increase the volume of imports of our strategic commodities,” said Mohamed Al Suwaidi, director general of Abu Dhabi Fund for Development and chairman of the exports executive committee of the Adex.
“Such moves contribute to the UAE’s economic diversification efforts, increasing trade with the rest of the world, and enhancing the presence of Emirati goods in the international market.”
The UAE’s non-oil foreign trade reached a record Dh2.23 trillion ($607.1 billion) last year, as the Arab world’s second-largest economy accelerates efforts to reduce its dependence on hydrocarbons and boosts its economic partnerships globally.
Set up in 2019, Adex offers financing solutions to exporters to help increase the UAE’s trade volumes and promote its export business in global markets.
The entity provides credit facilities to overseas buyers and importers through direct and indirect loans and guarantees.
Last month Adex also signed $121 million worth of green finance agreements with the government of Angola to support the country’s IT sector and infrastructure projects.
The UAE is aiming to grow the contribution of the manufacturing sector to the country's gross domestic product to Dh300 billion ($82 billion) by 2031, from Dh133 billion in 2021.
It is also encouraging companies to manufacture products locally as part of the Make it in the Emirates initiative.
The UAE economy is estimated to have grown by 7.6 per cent last year, the highest in 11 years, after expanding by 3.9 per cent in 2021, according to the UAE Central Bank.
Overall, the country’s economy is projected to grow 3.9 per cent in 2023, according to the central bank.
