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$10 billion IDB fund to be operational in mid-2007
UNITED NATIONS (November 29 2006): A proposed 10 billion-dollar poverty alleviation fund, created by the Islamic Development Bank (IDB), would become fully operational in mid-2007, said bank's Vice-President Amadou Boubacar Cissi on Monday.
He said the decision to raise the money was made by heads of state of the bank's member countries during the December 2005 summit of the Organisation of the Islamic Conference (OIC) in Makkah.
Cissi was addressing a press conference at the United Nation headquarters in New York, organised in connection with the General Assembly's informal thematic debate on "Partnerships towards achieving the millennium development goals (MDGs): Taking stock and moving forward".
He said Saudi Arabia had already pledged one billion-dollar to the fund. Kuwait had promised 300 million dollars and other members were expected to contribute shortly. The bank, he said, was currently committing more than four billion dollars a year to development projects to improve access to basic social services, support infrastructure and trade.
The 56-member Islamic Development Bank is a multilateral institution, comprising developing countries in Africa, the Middle East, Asia and the Commonwealth of Independent States (CIS), with a mandate to combat poverty.
The fund would operate within the framework of the MDG and focus on primary education (especially for girls); health (malaria, tuberculosis, HIV/AIDS and other communicable diseases); infrastructure; agriculture; microfinance; emergency assistance; and recovery and reconstruction. Financing would be provided on concessional terms, primarily for the 25 least developed Islamic Bank members.
Cissi, a former Prime Minister of Niger with two decades of experience at the World Bank, said the informal debate had provided a good opportunity for the bank to discuss ways to improve its operations and revive cooperation with such long-term partners as the UN Development Programme, UN Industrial Development Organisation, World Health Organisation, International Fund for Agricultural Development and the World Bank.
Asked about the fund's size and whether it would be available exclusively for Islamic countries, he said the Board of Governors was expected to approve a Charter in May.
The bank was trying to increase its current activities and the fund had been conceived as a "solidarity fund", whereby all members would contribute. Thus far, 17 of the 56 member countries had contributed and all major shareholders were expected to announce their contributions by May. The fund was expected to start with 10 billion dollars within a year.
The fund would be available for the 56 member countries, he added, stressing that financing terms would be compatible with Sharia. That meant the bank would focus on covering its administrative costs only.
Allocations to the fund would be considered grants, and loans would be made under specific criteria. Resource replenishment would be considered a procedural issue to be resolved by May. On whether the bank would allocate funds to individuals, governments or institutions, he noted the bank's 30 years of experience in tackling poverty through various means, including microfinance.
However, it was considering other approaches, such as the "Millennium Village" approach, which would tap into a network of non-governmental organisations and communities to develop an integrated strategy. Under that scenario, resources would be managed directly by beneficiaries.
Responding to a question, Cissi said the Islamic Bank had consistently allocated four billion dollars annually for poverty alleviation and there was strong coordination among donors. However, the bank had not publicised its work, which could be why there was discussion about Zakat resources. The bank was considering the use of private sector resources to increase the possibilities for the fund.
Asked about the manner in which the 10 billion dollars would be spent and for how long, he said the fund was a 10-year programme to be used for eradicating poverty and tackling the major diseases of malaria, tuberculosis and HIV/AIDS, particularly in African member countries. Senegal, Niger, Mali and Mozambique were already benefiting from Islamic Bank programmes and the institution hoped to develop an additional regional programme to fight malaria.
Regarding existing or potential activities in Sudan and Somalia, he said the bank was involved in water programmes in Somalia, Djibouti, Niger, Mali and Ctte d'Ivoire. It also maintained education programmes in all member countries under which it made loans to their governments.
On how the bank made money through "Sharia lending," he said the fund's primary goal was not to make money, but rather to cover its administrative costs. The bank's non-concessional operations provided income.
Asked about speculation that Sharia-based institutions were used to transfer money to terrorist groups, he said the Islamic Bank had maintained a "AAA" rating from various agencies, including Moody's, for more than four years. Furthermore, it had a board of directors as well as a board of governors, and produced a publicly available annual report.
On its lending conditions, he said the Islamic Development Bank did not impose "World Bank-style" conditions on its loans. Rather, it was debating with its partners how best to use resources to develop the best possible programmes. The poverty fund would target the least developed members, 80 percent of which were in Africa.
UNITED NATIONS (November 29 2006): A proposed 10 billion-dollar poverty alleviation fund, created by the Islamic Development Bank (IDB), would become fully operational in mid-2007, said bank's Vice-President Amadou Boubacar Cissi on Monday.
He said the decision to raise the money was made by heads of state of the bank's member countries during the December 2005 summit of the Organisation of the Islamic Conference (OIC) in Makkah.
Cissi was addressing a press conference at the United Nation headquarters in New York, organised in connection with the General Assembly's informal thematic debate on "Partnerships towards achieving the millennium development goals (MDGs): Taking stock and moving forward".
He said Saudi Arabia had already pledged one billion-dollar to the fund. Kuwait had promised 300 million dollars and other members were expected to contribute shortly. The bank, he said, was currently committing more than four billion dollars a year to development projects to improve access to basic social services, support infrastructure and trade.
The 56-member Islamic Development Bank is a multilateral institution, comprising developing countries in Africa, the Middle East, Asia and the Commonwealth of Independent States (CIS), with a mandate to combat poverty.
The fund would operate within the framework of the MDG and focus on primary education (especially for girls); health (malaria, tuberculosis, HIV/AIDS and other communicable diseases); infrastructure; agriculture; microfinance; emergency assistance; and recovery and reconstruction. Financing would be provided on concessional terms, primarily for the 25 least developed Islamic Bank members.
Cissi, a former Prime Minister of Niger with two decades of experience at the World Bank, said the informal debate had provided a good opportunity for the bank to discuss ways to improve its operations and revive cooperation with such long-term partners as the UN Development Programme, UN Industrial Development Organisation, World Health Organisation, International Fund for Agricultural Development and the World Bank.
Asked about the fund's size and whether it would be available exclusively for Islamic countries, he said the Board of Governors was expected to approve a Charter in May.
The bank was trying to increase its current activities and the fund had been conceived as a "solidarity fund", whereby all members would contribute. Thus far, 17 of the 56 member countries had contributed and all major shareholders were expected to announce their contributions by May. The fund was expected to start with 10 billion dollars within a year.
The fund would be available for the 56 member countries, he added, stressing that financing terms would be compatible with Sharia. That meant the bank would focus on covering its administrative costs only.
Allocations to the fund would be considered grants, and loans would be made under specific criteria. Resource replenishment would be considered a procedural issue to be resolved by May. On whether the bank would allocate funds to individuals, governments or institutions, he noted the bank's 30 years of experience in tackling poverty through various means, including microfinance.
However, it was considering other approaches, such as the "Millennium Village" approach, which would tap into a network of non-governmental organisations and communities to develop an integrated strategy. Under that scenario, resources would be managed directly by beneficiaries.
Responding to a question, Cissi said the Islamic Bank had consistently allocated four billion dollars annually for poverty alleviation and there was strong coordination among donors. However, the bank had not publicised its work, which could be why there was discussion about Zakat resources. The bank was considering the use of private sector resources to increase the possibilities for the fund.
Asked about the manner in which the 10 billion dollars would be spent and for how long, he said the fund was a 10-year programme to be used for eradicating poverty and tackling the major diseases of malaria, tuberculosis and HIV/AIDS, particularly in African member countries. Senegal, Niger, Mali and Mozambique were already benefiting from Islamic Bank programmes and the institution hoped to develop an additional regional programme to fight malaria.
Regarding existing or potential activities in Sudan and Somalia, he said the bank was involved in water programmes in Somalia, Djibouti, Niger, Mali and Ctte d'Ivoire. It also maintained education programmes in all member countries under which it made loans to their governments.
On how the bank made money through "Sharia lending," he said the fund's primary goal was not to make money, but rather to cover its administrative costs. The bank's non-concessional operations provided income.
Asked about speculation that Sharia-based institutions were used to transfer money to terrorist groups, he said the Islamic Bank had maintained a "AAA" rating from various agencies, including Moody's, for more than four years. Furthermore, it had a board of directors as well as a board of governors, and produced a publicly available annual report.
On its lending conditions, he said the Islamic Development Bank did not impose "World Bank-style" conditions on its loans. Rather, it was debating with its partners how best to use resources to develop the best possible programmes. The poverty fund would target the least developed members, 80 percent of which were in Africa.
