Emirates Development Bank, the state-owned lender that provides financing for the UAE’s priority sectors, has said that its contribution to the country's industrial gross domestic product soared to Dh4.3 billion ($1.17 billion) in 2023, amid a record year for the lender.
The 80 per cent annual surge puts EDB well on pace to achieve its goal of contributing Dh10 billion to the industrial economy by 2026, the Abu Dhabi-based bank said on Monday.
Total net financing approvals stood at Dh8.7 billion, also on track to realise EDB's strategy launched in 2021 that entails providing Dh30 billion in support to 13,500 companies by 2026.
EDB's 2023 performance was underpinned by a significant jump in net financing approvals for small and medium enterprises, which rose 72 per cent to Dh3.3 billion last year, it said.
The growth in GDP contribution and SME financing also led to the creation of a total of 17,219 jobs during the 12-month period, about 44 per cent higher than the 12,000-plus in 2022, the bank said.
In addition, EDB approved Dh1.3 billion in financing under its credit guarantee programme with partner banks in the UAE, which is a 64 per cent rise compared with 2022, reflecting the bank's “commitment to enhancing the financial inclusion of SMEs”.
“EDB’s dynamic strategy, which offers innovative financing solutions, has played a pivotal role in reshaping the UAE's industrial sector,” its chairman Dr Sultan Al Jaber, who is also Minister of Industry and Advanced Technology, said.
“These unparalleled results showcase the bank's commitment to making progress towards its goals, building a diversified economy and contributing to the resilience and competitiveness of the national economy.”
EDB, which became operational in June 2015, is a key financial engine for the economic development and industrial advancement of the UAE.
Its strategy is in line with the UAE government's special focus for the SME sector, considered critical for economic diversification, employment and expansion.
About 94 per cent of all companies operating in the UAE are SMEs, employing more than 86 per cent of the private sector labour force, data from the Ministry of Economy shows.
Local state-backed entities and strategies that support the sector include the National SME Programme, the UAE SME Council, Abu Dhabi's Khalifa Fund, Dubai SME and Operation 300bn, the 10-year strategy that seeks to increase the industrial sector's contribution to the country's GDP to Dh300 billion by 2031.
“We have set a clear goal to elevate EDB’s contribution to the UAE’s GDP … focusing on empowering the private sector to drive the nation's economic growth,” said Ahmed Al Naqbi, chief executive of EDB.
Mr Al Naqbi said 2023 has been “a milestone” for EDB in “reinforcing its role as a key enabler” of the UAE's economic growth and industrial advancement.
“Our strategic emphasis on sectors crucial to the UAE’s future development has led to the deployment of innovative and sustainable financing solutions,” he said.
