Approvals include project in Mozambique, Senegal, Benin, Cameroon, and Togo
In what could be a reflection of the high status and confidence, the Islamic Development Bank (IDB) continues to enjoy in the international financial arena, the Bank has raised its medium-term sukuk issuance programme from US$10 billion to US$ 25 billion. This was one of the items for okay by the Board of Executive Directors (BOED) of the IDB at its 305th session held in Maputo, capital of the Republic of Mozambique, under the chairmanship of H.E. Dr Ahmad Mohamed Ali, chairman of the Islamic Development Bank Group.
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.
Consequently, the IDB’s sukuk programme has maintained the “AAA” rating, which is the highest rating by the three international credit rating agencies mentioned above, together a stable outlook.
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 mobilizing and injecting new financial resources from the international money market to meet the growing development needs in member countries. The US$10 billion so far raised as part of the IDB’s sukuk programme have been used to finance various development programmes in member countries, particularly infrastructure projects. This is at a cost that is much lower than what it would have cost if they were financed through regular financing institutions.
The Board also approved participation in several development projects in member-countries amounting to nearly US$450 million.
Approvals included US$200 million for energy project in Mozambique, US$70 million for the Importation of agricultural equipment in favour of Kazakhstan. US$71.5 million for two Power projects in Senegal; US$30 million to support the integrated micro-financing programmes in Benin; US$28.5 million as participation in Mont Mbapite rural development project in Cameroon. US$20.7 million in road projects in Togo; US$16.3 million in two projects in Bangladesh; and US$12 million as contribution for the reconstruction of a road project in Kyrgyz.