The Saudi Industrial Development Fund (SIDF) has said it has increased the limit of loans to projects in industrially backward regions to 75 percent of the total cost of a project Arab News reported today.
The move is in line with the vision of Custodian of the Two Holy Mosques King Abdullah to achieve balanced and sustainable progress in all provinces and cities in the Kingdom, apart from providing more employment opportunities to Saudis, Director General of SIDF Ali Al-Aed said in a statement on Friday.
“The cities and provinces ranked as the least developed in terms of industries include Hail, Northern Border Province, Al-Jouf, Tabuk, Jazan, Najran, Baha and Asir,” Al-Aed said.
The loans to industrial projects in underdeveloped regions also enjoy an additional feature of extended period of repayment of up to 20 years, the Saudi Press Agency reported.
On the other hand, loans to industrial projects in major cities will remain at 50 percent of the total cost of the project with a repayment period of 15 years, Al-Aed said.
Cities such as Riyadh, Jeddah, Dammam, Jubail, Makkah, Yanbu and Ras Al-Khayr come under the category of industrially major cities, he said.
“According to the classification made by the fund, to the cities and regions which enjoy industrial development features to a level less than the major cites, the limit of loans are fixed at 60 percent of the total project cost,” he said.
This less developed category includes Qassim, Ahsa, Madinah (excepting Yanbu), Rabigh and Taif in addition to Al-Kharj Industrial City, Sudair Industrial City and their loan period would be up to 20 years. In order to enable the SIDF to increase the loan limits and time stipulations with regard to less industrially developed areas, the Council of Ministers had amended the sixth and eighth paragraph of the fourth clause of the SIDF bylaws, Al-Aed added.
Empowered by the amendments, the board of directors of the SIDF determined loan limits after detailed studies to classify all areas and cities in the Kingdom as developed, less and the least developed areas. The study was made on the basis of the parameters of industrial development and other features available in each region or city.
He appealed to investors to make use of the newly available benefits to launch projects in the less developed areas.
SIDF, which plays a key role in creating local industrial enterprises and employment opportunities, was set up by the government primarily to provide interest-free loans to Saudi businessmen to establish industrial plants and factories. The total loans approved for industrial projects, from SIDF’s creation until end of 2006, amounted to SR38.2 billion.