Emirates Development Bank (EDB), the state-owned lender focused on financing the UAE's priority sectors, boosted funding to industrial companies by 418 % during the 1st half of 2022 to drive the sector's growth.

The Abu Dhabi-based bank approved Dh2.4 billion ($653m) in loans to the UAE’s industrial sector in the 1st six months of the year, up from Dh 464m in the previous-year period, it said in a statement on 31st July.

The surge in industrial financing increased the bank's contribution to the UAE's gross domestic product to Dh1.9bn during the period, up from Dh425m in the 1st half of 2021.

EDB also more than doubled its lending to small and medium enterprises to Dh351m in the 1st half of 2022 through its credit guarantee scheme, up from the Dh168m allocated during 2021, it said.

The results underscore the potential of the UAE's industrial sector and the bank’s ability to mobilise finance to drive its expansion, said Dr Sultan Al Jaber, Minister of Industry and Advanced Technology and chairman of the EDB board.

"These results are a testament to the bank’s progress towards supporting the UAE’s economic diversification agenda and increasing its global competitiveness," Dr Al Jaber said.

"By expanding access to capital, the bank is helping develop a global hub for industry, advanced technology and the industries of future."

EDB funds companies in priority sectors including health care, infrastructure, food security and technology.

The lender works with state entities including the Ministry of Industry and Technology and free zones such as Dubai Industrial City, Jebel Ali Free Zone and Khalifa Industrial Zone in Abu Dhabi to provide financing to their clients.

Last year, the UAE launched its industrial 'Operation 300bn' strategy to position the Arab world’s 2nd-largest economy as a global industrial centre by year 2031. The 10-year plan focuses on increasing the industrial sector's contribution to the country's GDP from Dh133bn in 2021 to Dh300bn in 2031.

The strategy focuses on boosting production in 11 priority sectors, supporting the growth of national industries, attracting foreign investment and ensuring availability of dedicated financing for local industrial companies.

"Over the past period, we worked tirelessly to strengthen our capabilities partnerships, share our vision with industry leaders and cement our role in driving the national economy to reach greater heights and consolidate its pioneering position," said Ahmed Al Naqbi, chief executive of EDB.

"As we look forward to the remainder of this year, we remain committed to providing an all-encompassing business ecosystem for SMEs and start-ups."

In the 2nd half of 2022, EDB plans to use its assets in vital sectors and expand its digitalisation agenda across the bank, it said.

EDB aims to boost its funding to Dh5bn by the end of this year, Mr Al Naqbi said in June. In June last year, S&P Global Ratings affirmed its “AA-“ credit rating with a “stable" outlook for EDB.