Islamic Development Bank Approves $1.8bn Financing for Nigeria

The Islamic Development Bank (IsDB) has approved a total financing of $1.8 billion for Nigeria, as the country becomes the fourth largest shareholder of the multilateral financial institution.

The approval came as both parties commenced consultations to strengthen collaboration between them.

IsDB President, Dr. Mohamed Jasser, who is currently in Nigeria disclosed in Abuja Monday, that the approved $1.8 billion facility for Nigeria was made up of $971 million for project financing by the bank, and about $288 million provided by the Islamic Corporation for Development (ICD)–IsDB’s private sector affiliate.

Speaking during a meeting with the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, the IsDB President also disclosed that the sum of $477 million was in form of trade operations by its trade arm, the International Islamic Trade Finance Corporation (ITFC) and $90 million from other funds and operations.

Jasser added: “In addition, the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC) our investment guarantee arm has provided $1.1 billion as business insured and $1 billion as a new insurance commitment to help attract businesses and insure them.

“The IsDB active portfolio in Nigeria is standing now at $1.2 billion and we have completed about 55 per cent of all of those projects, we look forward to strengthening our bilateral relations.

“Out of the 36 states in Nigeria, IsDB has investments in 16 states. I applaud the Federal Government of Nigeria for emphasising the diversification of the economy.”

He stated that the IsDB was aware of Nigeria’s opportunities and potential for private-sector development, adding that the bank would try to boost the activities of the private arm of the IsDB to assist the development of the private sector and the economic diversification programme of the government.

He assured that, “the IsDB is keen to continue to engage Nigeria on its strategic priorities areas such as economic and social infrastructure and advisory support for strengthening Islamic financial services.”

Jasser explained that the IsDB was committed to supporting Nigeria to deal with the recovery phase of COVID-19 including providing the necessary support to the private sector to create and revive economic growth.

Jasser stated that Nigeria was the largest office outside of the bank’s head office in Jedda, explaining that the organisation would need a piece of land to build a permanent office in Abuja.

He said, “We are engaged in other areas like education and health and we are looking forward to entering the food sector as there is a $10 billion facility Nigeria can benefit from.”

In her remarks, Ahmed stated that the IsDB as a multilateral financial institution was established to foster the economic development and social progress of its 56 member-countries.

She noted that Nigeria is currently the fourth largest shareholder with 8.75 per cent shares which entitled it to have a permanent seat on the board of directors.

Ahmed said the IsDB President was in Nigeria to strengthen collaboration between the bank and the country.

According to her, the visit would also serve as an avenue to discuss the IsDB Group’s Strategy Update & Alignment and Member Country Partnership Strategy (MCPS) for the period 2023-2025 anchored on Nigeria’s Medium Term National Development Plan (MTNDP) 2021-2025, among others.

The minister stressed that the IsDB offers a catalogue of services and facilities.

These, she said included providing financial assistance to member-countries in form of economic and social development such as concessionary loan, non-concessionary (ordinary financing) and grants; establishing establish and operating special funds for specific purposes in addition to setting up trust funds.

Others are assisting in the promotion of foreign trade especially in capital goods, among member-countries; providing technical assistance to member countries, and extending training facilities for personnel engaged in development activities in Muslim countries to conform to the IsDB principles.

Nigeria, she said, became a regional operational hub of the bank in Africa in 2017, as it expanded its existing country gateway office in Abuja, to serve as a key regional office.

According to her, the regional office coordinates the operations of the bank in its West and Central African member-countries, which constitute majority of the 27 African countries in the institution.

Ndubuisi Francis

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