Saudi Arabia’s central bank said it had prepared a 50 billion riyal ($13 billion) package to help small and medium-sized enterprises cope with the economic impacts of the coronavirus outbreak.

The funding from the Saudi Arabian Monetary Authority (SAMA) is aimed at granting SMEs six-month deferrals on bank payments, concessional financing and exemptions from the costs of a loan guarantee programme.

The central bank and Saudi Arabia on Saturday announced stimulus plans worth $13 billion to ease the impact of the coronavirus outbreak. The Saudi Arabian Monetary Authority said it had prepared a 50 billion riyal ($13.32 billion) package to help small and medium-sized enterprises (SMEs) cope with the economic impacts of coronavirus. The disease has so far infected 105 in Saudi Arabia.

The Saudi funding aims to grant SMEs six-month deferrals on bank payments, concessional financing and exemptions from the costs of a loan guarantee programme, SAMA said.

Concerts, sporting events and industry conferences have been cancelled or postponed in the past few weeks in the UAE to contain the spreading of the new coronavirus.

The Middle East’s trade, finance, tourism, transportation and some businesses have started to feel the pain from the global travel slowdown caused by the outbreak.

Saudi Arabia, which has already suspended the Umrah pilgrimage and locked down its eastern Qatif region where many infections are located, plans to halt all international flights for two weeks from Sunday.

Adding to a likely economic slowdown caused by the virus, Saudi Arabia expected to face wider fiscal deficits this year because of lower oil prices.

In recent weeks, Riyadh has announced that it is ramping up oil production that has sent global prices plunging and contributed to the coronavirus rout on international financial markets.

The UAE regulator also plans to support banks and businesses in the country, where the outbreak is affecting major economic sectors such as tourism and transport, with a Dhs100 billion dirham ($27 billion) economic plan, it said on Saturday.

The UAE regulator said on Saturday it maintained its commitment to the peg for the dirham, and said foreign currency reserves amounting to Dhs405 billion as of March 10 were “adequate” to safeguard the stability of the currency.

The UAE central bank said it will provide Dhs50 billion through collateralised loans at zero cost to all banks operating in the UAE while an additional Dhs50 billion will be freed up from lenders’ capital buffers.

“The CBUAE is allowing banks to free-up their regulatory capital buffers to boost lending capacity and support the UAE economy,” it said in a statement.

It said the scheme offers banks relief for up to six months from the payments of principal and interest on outstanding loans for affected private sector companies and retail customers.

Other measures introduced by the central bank on Saturday include reducing by 15-25 per cent the amount of capital banks have to hold for loans to SMEs, and better terms for first-time home buyers. Banks will be allowed to increase their exposure to real estate loans.

“When the exposure reaches 20 per cent of the banks’ loan portfolio, banks will be allowed to increase it to 30 per cent, but will be required to hold more capital,” it said.

Agencies