MUSCAT: A decision to raise the current limit of the Islamic Development Bank’s (IDB) medium-term sukuk issuance programme from $10 billion to $25 billion has been approved.
The board of executive directors (BOED) of IDB approved the decision at its 305th session which began on Sunday in Maputo, capital of the Republic of Mozambique, under the chairmanship of Dr Ahmad Mohamed Ali, chairman of the Islamic Development Bank Group.
On this occasion, the BOED commended the huge success of programme in all its previous issuances since it began in 2003.
This is a reflection of the high status and confidence the bank continues to enjoy in the international financial arena. The IDB is regarded as one of the few multilateral financing institutions that have been rated for more than 12 consecutive years with “AAA” , the highest international credit rating available, by the three major international credit rating agencies – Standard & Poor’s, Fitch and Moody’s. This is in addition to the designation of the IDB as ‘Zero-Risk Weighted’ Multilateral Development Bank by the Basel Committee on Banking Supervision in 2004 and by the European Commission in 2007.
The bank has decided to reintroduce its medium-term sukuk issuance programme.
which is in line with the provisions and principles of the Islamic Sharia, with the aim of mobilising and injecting new financial resources from the international money market to meet the growing development needs in member countries.
The $10 billion raised so far as part of the IDB’s sukuk programme have been used to finance various development projects in member countries, particularly in the infrastructure sector.
This is at a cost that is much lower than what it would have been if they were financed through regular financing institutions.
The board also approved participation in several development projects in member countries amounting to nearly $450 million.
Approvals included $200 million for an energy project in Mozambique,$70 million for the import of agricultural equipment to Kazakhstan,$71.5 million for twopower projects in Senegal,and $30 million to support the integrated micro-financing programmes in Benin, in addition to $28.5 million towards the Mont Mbapite rural development project in Cameroon, $20.7 million for a road project in Togo, $16.3 million for two projects in Bangladesh, and $12 million for the reconstruction of road project in Kyrgyzstan.
