This is the first in a series of three articles that will explore the increasingly significant role that ECA financing plays (and will continue to play) in facilitating the development of high-value, complex infrastructure projects in the GCC, and the effect that the recent Iran conflict may have on the adoption of these structures. This article will provide an overview of the fundamentals of ECA financing, including the forms which it may take and the project contracts for which it may be deployed.

The subsequent two articles will examine (i) the considerations which developers and procurers of critical infrastructure projects should have in mind, and (ii) recent trends, in the context of evolving political and economic circumstances across the region, including potential impact of the conflict in Iran on availability and appetite for ECA finance.

Background

A key pillar of the economic strategies of all GCC states, and of Saudi Arabia and the UAE in particular, is increased private sector investment and reduced dependency on government receipts from oil production to drive economic growth. The two biggest players in the region, Saudi Arabia and the UAE, have ambitious project pipelines that cannot be realised without such private sector support[1]. These countries are also eager to realise change in a short space of time: readers will be familiar with Saudi Arabia’s Vision 2030 and Abu Dhabi’s Vision 2040, for example, requiring ever-higher levels of capital investment over a relatively short period of time.

As we predicted last year, liquidity and timeline pressures are encouraging procurers to explore alternative means of funding large-scale infrastructure projects, although the recent conflict in Iran has placed many of these models under pressure[2].

Export Credit Agency (ECA) financing is emerging as a critical and increasingly flexible and attractive method. Indeed, ECA financing is firmly entrenched as an enabler of critical infrastructure delivery worldwide. The latest OECD Consensus update two years ago gave ECAs greater flexibility to support projects, particularly those advancing the energy transition and transportation, but their role now extends well beyond that, providing developers and procurers with enhanced liquidity, reliability, and execution-capability to mitigate some of the challenges presented by an increasingly complex geo-political environment.

Recent developments, particularly the innovation of adaptable ECA-backed structures and the novel use of Supplier Credit, reflect a desire among ECAs (and their host governments) to provide practical support to strategically important projects, making it especially significant for the GCC as it accelerates the rollout of its ambitious critical infrastructure pipelines. 

These pipelines present immense opportunities for ECAs and exporters alike – with the total value of the GCC’s current projects being around $2.1tn, with a further $1.5tn in the planning stages[3].

This is especially significant in the increasingly volatile conditions caused by the Iran conflict, which remains ongoing at the date of this article. For now, the fundamentals underpinning the adoption of ECA financing remain in place, but this may change depending on the length and extent of the disruptions caused by the ongoing conflict.

Overview

Understanding ECA financing and Its role in infrastructure development

ECA financing has become a key component of the infrastructure finance universe. 

At its core, ECA finance involves the provision of loans, guarantees, or insurance by government-backed agencies to support exports from their home country (or otherwise achieve important political or strategic goals). By covering risks that private lenders may be unwilling to assume (whether commercial, political, technological or country-specific), ECAs unlock capital flows into large-scale projects that might otherwise struggle to reach financial close.

Our finance lawyers have been advising on ECA-supported transactions for many years, witnessing first-hand the evolution of this financing tool from a niche instrument used primarily to facilitate bilateral trade, into a mainstream source of long-term, stable funding for complex, capital-intensive infrastructure projects.

Tied vs untied ECA finance

Historically, the vast majority of ECA Finance has been ‘tied’. This means that it has been linked directly to the procurement of goods or services or, in some cases, the provision of equity, from the ECA’s home country. For example, a GCC energy project importing turbines from a European country’s manufacturer might receive tied support from that country’s ECA and the level of that support would be directly tied to the value of goods and services being procured from that country. Recent examples of tied ECA facilities in the GCC include:

• Mitsui & Co. Ltd.’s February 2026 $413m facility backed by Japanese ECA, Japan Bank for International Cooperation (JBIC), in connection with the development of Adnoc’s Ruwais LNG Project in Abu Dhabi;
• the Ras Abu Fontas Power Company’s January 2026 $990m JBIC-backed facility as part of a broader $2.97bn co-financing package, which also included undisclosed contributions from the Export-Import Bank of Korea, the Korean Development Bank and Kexim Global (Singapore) Ltd;
• the Riyah Al-Sahil Company’s 2025 $152m JBIC-backed facility in connection with the construction of the 700MW Yanbu onshore wind project;
• Qiddiya Investment Company’s 2024 $700m Murabaha facility, backed by UK Export Finance, for the construction of the Six Flags Theme Park in Qiddiya City on the outskirts of Riyadh; and
• Borouge’s 2023 $3.2bn Sace-backed facility in connection with the procurement of Italian goods and services for its Ruwais petrochemicals facility. 

Untied ECA finance, by contrast, is not conditional on sourcing goods or services from the sponsoring country. Instead, it is typically motivated by strategic objectives such as securing access to natural resources, supporting overseas investments by domestic companies, or fostering bilateral economic cooperation. Although less common, untied products can provide borrowers with greater procurement flexibility.

In January 2025, Neom made headlines when it announced that it had closed on a deal with Italy’s Sace and nine lenders, securing approximately $3bn under a long-term multicurrency untied facility[4]. 

Since then, Sace has also announced a deal with Saudi Electricity Company to secure the provision a $1bn untied facility with a consortium of 13 lenders, signed in December 2025[5].

Buyer credit vs supplier credit

Two standard structures dominate ECA financing: Buyer Credit and Supplier Credit.

Under a Buyer Credit, the ECA provides financing support to the importer/project company[6] or, more commonly, the lenders to the importer/project company; ensuring that it is in a position to purchase the relevant goods and/or services from the supplier/exporter in the ECA’s home country. 

A Supplier Credit, in contrast, involves the exporter extending credit to the importer/project company and agreeing to deferred payment terms. To enable the exporter/supplier to receive payment (in advance of the payment dates agreed between the exporter and importer), a local bank may agree to finance the deferred payments (e.g. through a receivables purchase arrangement); often the local bank will do so on the basis that it receives ECA cover against the risk of non-payment by the importer/project company.

Traditionally, long-term ECA-backed infrastructure financing has been deployed on the basis of a Buyer Credit facility, with Supplier Credit being retained for smaller, shorter-term financing arrangements. However, we have recently seen Supplier Credit structures being adapted to support the delivery of critical infrastructure – this will be addressed in greater detail in the third article in this series. 

ECA financing for EPC+F and PPP projects

ECA financing is compatible with multiple project contract structures. Two commonly employed structures in the GCC for major projects are:

• EPC+F contracts: where construction costs, which are traditionally paid by the procuring authority during the construction phase upon achievement of milestones laid down in the EPC contract, are sourced through buyer or supplier credit structures with debt repayment taking place after completion of construction activities; and 
• PPP contracts: where private sector partners undertake to finance, design, build, maintain and operate an asset in exchange for periodic payments during the operation phase of the project. In the GCC, these periodic payments are typically made by the procuring authority in the form of guaranteed unitary charges. 

Both structures can leverage ECA financing. In an ECA-financed EPC+F structure, milestone payments during construction are financed by ECA-backed loans which the procuring authority would repay following construction completion. In an ECA-financed PPP structure, similar arrangements are put in place to support the private sector Project Company’s payments under its EPC Contract and the unitary charges under the PPP contract are sized to ensure that the Project Company can make its repayments. 

Conclusion

ECA financing has been, and continues to be, a key method of funding significant infrastructure projects both globally and specifically in the GCC. It can take multiple forms and is suitable for a variety of project contracts. The next article in this series will focus on the advantages and disadvantages, or challenges, which ECA financing brings and the factors which need to be considered by both developers and procurers when determining whether to deploy it.

Footnotes

[1] For more detail on the PPP regulatory landscape in each of the GCC countries, see the King and Spalding report Middle East PPP Law Report (2nd Edition) (2025)

[2] See the King and Spalding article on Alternative Financing Models for Real Estate and Infrastructure in Saudi Arabia

[3] See HSBC’s article: Export credit industry eyes a $3tn-plus Middle East capex spend

[4] See Finance Middle East’s article: Neom secures $3bn ECA financing with Italy’s Sace - Finance Middle East

[5] See Global Trade Review’s Article: Sace’s Push strategy deployed for US$1bn Saudi electricity facility

[6] This is often the “Employer” under a construction contract. Depending on the nature of the project (e.g. where the government is procuring the project), this could also be a government entity.