First Published: 2017-11-09

London gives Saudi Aramco $2 billion loan guarantee
Britain woos Saudi oil giant ahead of stock market flotation next year which it hopes will be in London.
Middle East Online

Saudi Arabia plans to sell under 5% of Aramco in the world's largest ever IPO.

LONDON - Britain will provide state oil giant Saudi Aramco with a $2-billion loan guarantee to help it buy British exports, the UK government said Thursday.

Britain is seen as wooing the company ahead of a stock market flotation next year which it hopes will be in London, even if the government denied that this was the reason for it guaranteeing bank loans to the kingdom.

The guarantee will be supplied by UK Export Finance, a state credit agency which seeks to improve the country's trade balance by providing finance to foreign buyers.

"UKEF's support will take the form of a $2-billion (1.72-billion euros) guarantee on bank lending," the government said in a statement.

It pointed out that UKEF had already provided Saudi Aramco with nearly £500 million in support to UK exports over the past five years.

"This (guarantee) has nothing to do with the potential float, it's about increasing UK exports," a Treasury spokesman said.

Saudi Arabia last year announced plans to sell under five percent of Aramco in the world's largest ever initial public offering.

Britain is laying down the red carpet to convince Riyadh that it should choose to list in London, whose status as a leading stock exchange is at risk from the UK's decision to leave the European Union.

On a visit to Saudi Arabia with UK business leaders in April, British Prime Minister Theresa May pitched the London bourse as a venue for the expected listing, with Britain facing competition from other key financial centres, including New York.

May reportedly held a private meeting with Energy Minister Khaled al-Falih, who also heads Aramco, in the presence of London Stock Exchange Group chief, Xavier Rolet.

By offering the loan guarantee, Britain is seen as helping Saudi Arabia to diversify its oil-dependent economy.

But May's visit to the ultra-conservative kingdom faced criticism back in Britain and ahead of the trip, she had faced calls to raise rights issues with its leaders.

 

Hariri back in Lebanon

Divided Syria opposition meets in Riyadh

Revolt in US State Department over child soldier law

US carries out air strikes against IS in Libya

Morocco bans bitcoin transactions

Lebanon's Hariri in Egypt ahead of return home

Rebels say Sanaa airport 'ready to run' after coalition bombing

Greece to amend historic sharia law for Muslim minority

Turkey to ask Germany to extradite top coup suspect

Car bomb in northern Iraq kills at least 24

13 million Syrians need aid despite relative drop in violence

Sudan urged to improve plight of Darfur's displaced people

Brain drain means Syria can’t recover for a generation

Palestinians close communication lines with Americans

Anti-IS coalition strikes drop to lowest number

German police arrest six Syrians ‘planning terror attack’

Palestinian factions in Cairo for reconciliation talks

Turkish opposition daily web editor sentenced to 3 years in jail

Israeli police arrest 33 in ultra-Orthodox draft riots

Turkish lira at new low against US dollar

Islamic republic declares end of Islamic State

Assad in Russia for talks with Putin

UN chief horrified by Libya slave auctions

Qatar 2022 chief has no regrets over hosting World Cup

Gheit says Lebanon should be 'spared' from regional tensions

Saudi Arabia, Arab allies push for unity against Iran, Hezbollah meddling

Syria ‘de-escalation zone’ does nothing to stop civilian deaths

Is a demilitarised Palestinian state a viable option?

S&P affirms good Saudi credit ratings

Israel president faces big backlash over Palestinian scarf

Sudan leader to visit Russia Thursday

Seven years into Libya’s civil war, the chaos continues

Iraq top court declares Kurd referendum unconstitutional

Libya to investigate 'slave auction' footage

15 women killed in food aid crush in Morocco

Lebanon FM will not attend Arab League Iran summit

Syrian forces liberate Albu Kamal from IS

Israel votes to shut migrant centre, deport Africans

Diplomats from Iran, Russia, Turkey discuss Syria

Libya to investigate ‘slave auction’ footage

Piece by piece, Iran moves towards a ‘new empire’

Netanyahu faces new questioning over corruption case

Syria troops, allies retake most of Albu Kamal from IS

EU cuts funding to Turkey in 2018 budget

Lebanon's Hariri arrives in Paris