Saudi Arabia

JEDDAH: International Islamic Trade Finance Corporation (ITFC) is scheduled to sign deals on Thursday exceeding $1 billion to support strategic commodities for a number of its member countries, CEO of ITFC Hani Salem Sonbol told Arab News.
The deals target the socioeconomic and trade development of these countries.
“The ITFC work is very diverse,” Sonbol told Arab News in an exclusive interview on the sidelines of the 42nd Islamic Development Bank (IDB) annual meeting that concludes Thursday. “We cover all aspects. Because we came to believe that financing alone will not help member countries.”
The Jeddah-based ITFC, which is an autonomous entity within the IDB, has 57 member countries from Suriname in South America to Indonesia in Southeast Asia.
The total IDB group trade financing since inception is $60 billion, out of which the ITFC contributed $36 billion to the member countries.
The main sectors that the ITFC supports are the energy and the agricultural sector. Each country is supported according to its need.
“We customize solutions,” Sonbol said, adding “We don’t have one size fits all.”
The business model adopted by the ITFC is to respond to the changing needs of member countries and the new challenges facing them. The model entails blending trade finance and trade development aspects.
“We don’t have shelf products, except for direct financing, ‘Murabaha’ financing, which is a cost-plus-profit arrangement in Islamic finance,” he said, adding that each country needs a program designed to fit its specific needs.
Two-thirds of the supported member countries are in Africa. Earlier this week, the ITFC signed a three-year $450 million framework agreement with the government of Burkina Faso, which Sonbol described as “one of the major clients.”
The agreement aims to enhance the country’s ability to export agricultural commodities such as cotton and also import its needs from the basic strategic commodities like crude oil and refined petroleum products as well as agricultural input.
The largest portion of the ITFC’s portfolio is to enhance the energy sector in the member countries; at almost 60 percent. This includes green energy, Sonbol said.
“What is new now is the ITFC is aware of the changes that new types of energy actually exist and that’s why we also try to innovate our products and programs to support renewable energy, green finance, and all these environment-friendly products,” he said.
There are new items on the ITFC agenda today. Digitization is one of them. Renewable energy, climate change, which is directly linked to trade finance, is another. Food security and an important sector that the ITFC is supporting, which is the agricultural sector, are also on the agenda.
Other programs are related to capacity building, promotional trade, and business-to-business (B2B) contracts. “Recently we had a very important B2B between African cotton producers and Bangladeshi cotton importers. We try to facilitate trade through our programs, build capacities in member countries,” Sonbol said.
As there is a regional move toward diversifying the economy to adjust to the recent oil crises, there is a move to invest in the SMEs industry.
The ITFC is designing new programs for SMEs to help meet challenges in areas like access to finance and capacity building.
“They need knowledge and advice so we support with advisory services,” Sonbol said, adding that the ITFC is currently working with the Saudi Ministry of Commerce to develop the SME sector in the Kingdom.
Boosting SMEs is among the goals in the Saudi Vision 2030 and they are described as being “among the most important agents of economic growth; they create jobs, support innovation and boost exports,” the Saudi Vision states.
Sonbol said that this program could be replicated in other countries in the future.
“We have been supporting SMEs in the private sector in general and we have achieved almost $10 billion of financing to this important sector.”
He added that the sector plays a major role in the diversification of the economy, similarly in Morocco, Tunisia or Pakistan.

Originally published on www.arabnews.com

JEDDAH, Saudi Arabia — The finance ministers of Guyana and Suriname, Winston Jordan and Gilmore Hoefdraad, will lead their respective delegations to the 42nd Islamic Development Bank (IsDB) meeting, which begins Sunday, May 14 to 18 in Jeddah, Saudi Arabia. The alternative governor of Suriname to the Islamic Bank, Dr Anwar Lall Mohamed, will also be part of the Surinamese delegation.

Currently, Guyana has filed six projects for financing at the IsDB, and other projects are in the pipeline; however, Guyana is concerned about the “slow pace” of the bank’s review and approval of its project proposals and will use its presence in Jeddah to push forward these projects.

According to Mohamed, Paramaribo is robustly working to advance and commence pending projects with the bank, including, among others, the healthcare strengthening project; detailed design of the new academic hospital, two education projects and the work program for 2017-2020.

Suriname has a longer history with the Organisation of Islamic Cooperation (OIC) and the IsDB, whereas Guyana was the second country in the Americas to join the multilateral organizations.

Guyana and Suriname share many similarities and have huge development potential, Mohamed said.

In many areas of development, Guyana is ahead of Suriname and in other areas, Suriname is ahead of Guyana. Both countries are cooperating in “reverse linkage” or technology transfer on rice with Malaysia and “reverse linkage” with Indonesia on livestock, Mohamed noted.

“By and large our two neighbouring member-countries have an excellent cooperative spirit that we share with each other in development of our countries. We are two member countries of the OIC that are strengthening south-south cooperation,” he added.

With the future development in the oil sector, Guyana will become one of the important players in the oil industry. Suriname also has the potential to find vast quantities of oil off its coast. However, it is yet tap a major reserve.

Intensive preparations are under way for the annual meeting of the Islamic Bank group under the theme ‘Youth Economic Empowerment’.

The agenda of the meeting of governors includes a youth summit, aimed at shaping the future of youth and enhancing youth engagement in socio-economic development. Participants include senior officials and major youth influencers, and youth groups of different specializations from member countries, according to an Islamic Bank press release.

“Inclusive human development is a key element of our ten-year strategic framework. The 42nd annual meeting under the theme ‘Youth Economic Empowerment’, comes as a major occasion to achieve this by sharing experiences and best practices on education initiatives, and strengthening partnership with the private sector on youth empowerment,” said Dr Abdulhakim Elwaer, IsDB Group spokesperson.

“The annual meeting will offer a broad platform for decision makers from all our member countries to discuss the challenges and opportunities in education and skills development, and recommend strategies to provide youths with the relevant skills and competencies to meet the demands of the 21st century labour market,” Elwaer added.

The meeting will give a chance to youth from member countries to take part in the workshops and different events in which high-level experts from private and public sectors, academia and the civil society will participate.

In recent years, the IsdB has offered assistance in creating a medical education and research institute in Jakarta, Indonesia; supported education initiatives in Senegal and Somalia; provided electronic education facilities for two million children in Syria; and helped build better schools in Togo and Tajikistan.

Originally published on www.caribbeannewsnow.com

Saudi Electricity Company (SEC) has announced the results of a special meeting of the holders of the Saudi Electricity Sukuk 3.
Saleh Al-Awajji, SEC chairman chaired the meeting at the company’s head office in Riyadh.
The company will purchase SR1,269 million in aggregate nominal value of sukuk (equivalent to 18.13 percent of the aggregate nominal value of the sukuk as on May 10). The new purchase date occurring in May 2022 has been added in respect of the remainder of the sukuk.
Ziad Al-Shiha, CEO of SEC, said: “The company’s success in achieving the first sukuk rollover in the Saudi local sukuk market affirms its pioneer role as the largest Islamic sukuk issuer from the Saudi business sector.”
He said that the rollover of the sukuk instead of issuing a new one is sensible for both the company and the sukuk holders. It provides advantages when compared to a new issuance in terms of an expedited timeline and simplified documentation.
Al-Shiha added: “The SEC has a large portfolio of projects under development, and it follows a diversified and balanced financing strategy to meet the investment requirements in these projects in addition to the financing dues at the same time.
He said: “I am happy with the majority of sukuk holders who decided to retain their investment in this high-rated credit instrument as a gesture of confidence in the company, its business model, its board of directors and its executive management.”
The company has plans to visit China in the coming days to meet with Chinese companies and banks to discuss cooperation and financing opportunities. The SEC is looking forward to expanding its partnership with Chinese companies in its projects while undertaking mega investments.
This is part of the company’s plan to expand its financiers and investor base in China.

Originally published on www.arabnews.com