On the last day of October, the Saudi finance ministry said in a statement that the country had deposited $3 billion with Egypt’s Central Bank as part of efforts to help the North African country confront the coronavirus pandemic.
This latest deposit comes shortly after the World Bank approved a $360 million development policy financing loan to Egypt to support its post-pandemic recovery.
Saudi also extended the term of another $2.3 bn in previous deposits. Egypt and Saudi are close allies with both countries forming half of the quartet which placed a blockade on Qatar in 2017.
Saudi, as of end-March, had long-term deposits with Egypt’s central bank of $5.5 bn, CBE data showed.
Saudi also deposited $3 bn with Pakistan’s Central Bank and extended $1.2 bn of trade finance to support Pakistan’s balance of payments, the same statement said.
“The Kingdom is one of the main countries that supported the foreign reserves of needy countries during the pandemic,” it added.
Special Drawing Rights
The facilities for Egypt and Pakistan together amounted to $9.5 bn which represents 75% of the Kingdom’s Special Drawing Rights (SDR) created by the International Monetary Fund (IMF), Asharq reported.
The Saudi Central Bank’s SDR at the IMF recorded a strong jump by the end of August 2021 with the value of assets rising in one month by 163.5% reaching nearly $22.22 bn.
By the end of August, IMF distributed special drawing rights for the fourth time in its history to its members. The value of SDR amounted to nearly $650 bn, equivalent to 456 billion units, which is the largest in history.
Saudi Arabia is the largest Arab country to obtain 9577.5 million SDRs, and its voting share is 2.1%. The UAE comes in second place with 2125.2 million SDRs, and its voting share is 0.49%, while Egypt comes in third place with 1952.5 SDRs, and its voting share is 0.43%.
Special drawing rights are supplementary foreign exchange reserve assets defined and maintained by IMF which it created in 1969 to supplement official reserves of its member countries when they met with a shortfall of preferred foreign exchange reserve assets, namely gold and US dollars.
The most recent allocation was in August this year to address the long-term global need for reserves and help countries cope with the impact of the coronavirus pandemic.
Saudi Egypt trade
In 2019, Saudi exported $5.05 bn worth to Egypt. The main products it exported were Refined Petroleum ($1.66 bn), Crude Petroleum ($894 million), and Petroleum Gas ($658 mn). During the last 24 years, the exports of Saudi to Egypt have increased at an annualized rate of 13.1%, from $264 mn in 1995 to $5.05 bn in 2019.
In 2019, Egypt exported $2.07 bn worth to Saudi. The main products it exported were Refined Petroleum ($331 mn), Hot-Rolled Iron ($150 mn), and Citrus ($116 mn). During the last 24 years, the exports of Egypt to Saudi have increased at an annualized rate of 10.2%, from $203 mn in 1995 to $2.07 bn in 2019.
Saudi Pakistan trade
In 2019, Saudi Arabia exported $2.23 bn worth to Pakistan. The main products that Saudi Arabia exported to Pakistan were Crude Petroleum ($1.26B), Propylene Polymers ($253M), and Ethylene Polymers ($223M). During the last 24 years, the exports of Saudi Arabia to Pakistan have increased at an annualized rate of 12%, from $146M in 1995 to $2.23B in 2019.
In 2019, Pakistan exported $477M to Saudi Arabia. The main products that Pakistan exported to Saudi Arabia are Rice($108M), Bovine Meat ($34.3M), and House Linens ($20.2M). During the last 24 years, the exports of Pakistan to Saudi Arabia have increased at an annualized rate of 5.04%, from $146M in 1995 to $477M in 2019.