An overseas trade promotion organisation to be established by the end of 2011 will pave the way for an export credit agency.
Abu Dhabi to set up new export agency
Abu Dhabi will establish an export promotion agency by the end of next year as a first step towards creating its own export bank to help diversify the emirate's economy, officials say.
The news comes as the UAE and other Gulf countries face down accusations that they have unfairly benefited from cheap financing provided by western export credit agencies to buy aircraft built in the US and Europe. Industrialised countries are now considering a proposal to limit the amount of export financing they make available to Middle East carriers.
Abu Dhabi's export promotion agency will provide incentives and give advice to local companies that plan to export goods and services. It would pave the way for the launch of an export-import bank, also known as an export credit agency, to issue loans to overseas companies that import goods produced in the emirate.
The export promotion agency is expected to be set up before the end of next year, said a Government source close to the plans, who would not be quoted by name.
Representatives of the Department of Economic Development last week met the management of the US Export-Import (Ex-Im) Bank, which officials see as a model for the emirate's own export credit agency.
"We are moving forward with both the export promotion agency and the export-import bank," the Government source said. "The time frame we are working towards is to have the export promotion agency in place and operational by the end of next year."
The promotion agency would supply exporting companies with information on potential markets and help to connect them with interested buyers, as well as advertise the "Made in Abu Dhabi" brand internationally through trade shows. The money available for loans through the export credit agency was not disclosed.
Export credit is used by governments to stimulate economic growth by providing financial assistance to foreign buyers of goods and services. Such agencies became especially important in the aftermath of the global recession by helping to sustain funding for exports at a time when bank financing and other sources of loans dried up.
Export credit came under fire last week from airline executives in Canada and Europe who said they were giving competing Gulf carriers access to low-cost financing.