في ختام فعاليات ملتقى بناة مصر 2024.. الجلسة الخامسة تبحث إشكالية التسهيلات المالية واللوجيستية لتوسيع دوائر الأعمال بالخارج

Islamic Development Bank: Total Group Financing $189 Billion by the End of July… and $3 Billion in Investments Available in Africa

Iman Abdel Aziz: 6 main roles of the Islamic Corporation for the Insurance of Investment and Export Credit

Expert reviews Arab Bank for Economic Development’s strategy for financing African countries

At the conclusion of the activities of the Builders of Egypt Forum 2024.. The fifth session discusses the problem of financial and logistical facilities to expand business circles abroad

With the attendance of a number of Arab and African delegations, the fifth session of the Builders of Egypt Forum, the largest event in the construction sector, in its ninth session, which was attended by a large number of ministers, focused on the problem of “financial and logistical facilities to expand business circles abroad”, reviewing the role of international financing institutions in developing the export of the contracting industry, and their future plans to support development strategies in various countries, especially since the main goal of international financing institutions is to finance national and investment projects with a good social and environmental impact on citizens, so construction is an important element in achieving this goal.

The last session raised the extent to which the repercussions of the global inflation wave and global economic crises have affected the orientations of international financing institutions in supporting development and infrastructure projects in various countries, and whether there are new priorities imposed by the Russian-Ukrainian war crisis, and the repercussions of security conflicts in many countries at the present time.

In this context, the session presented a special presentation by the Islamic Development Bank Group, one of the most prominent international financing institutions whose strategy focuses on full commitment to the sustainable development goals, and realizes that development goals and reconstruction and development plans differ from one country to another. The group supports development projects that reflect positive indicators on the construction and building industries in Islamic countries and contribute to supporting the implementation of construction plans and the formation of strong economic blocs represented by national companies for construction industries and related building materials industries.

The presentation was given by Eng. Zuhair Mohammed Kashghari, Operations Team Leader at the Islamic Development Bank Group’s Regional Office in Cairo, Eng. Taha Al-Feel, Head of the Procurement Department in the Financial and Project Procurement Department at the Islamic Development Bank Group’s Regional Office in Cairo, and Iman Abdel Aziz, from the Islamic Corporation for the Insurance of Investment and Export Credit at the Islamic Development Bank.

At the beginning, Eng. Zuhair Mohammed Kashgari, Operations Team Leader at the Islamic Development Bank Group’s Regional Office in Cairo, said that the group’s total financing reached $189 billion by the end of July, explaining that the bank’s share alone exceeded $69 billion, which represents 37% of the financing volume.

He added during the bank’s presentation at the forum’s activities that the total volume of financing for the International Islamic Trade Finance Corporation reached $79.4 billion, which works to enhance the social and economic development of the peoples of 57 member states and Muslim communities in non-member states.

He stated that the institution evolved from a single entity to a group of five members, which began with the establishment of the Islamic Development Bank in 1975, a multilateral institution working to improve people’s lives by promoting social and economic development. This was followed by the launch of the Islamic Development Bank Institute in 1981, responsible for creating and disseminating knowledge in the field of Islamic economics and finance, and then the launch of the International Islamic Corporation for Investment Insurance and Export Credit in 1994, which provides investment insurance and export credit to Islamic countries.

He continued: “In 1999, the Islamic Corporation for the Development of the Private Sector was established, which works to support economic development in member states through private sector projects. The International Trade Finance Corporation was also established in 2008, which is an incentive for developing trade among member states of the Organization of Islamic Cooperation.”

He pointed out that there are a number of funds affiliated with the group, including the International Sustainable Development Fund, the Islamic Solidarity Fund for Development, which provides financial support to enhance productive capacity and sustainable means of income for the poor, the Endowment Fund for Real Estate Investment, the Life and Livelihood Fund, and the Economic Empowerment Fund.

He explained that the distribution of sectoral financing is according to cost, indicating that the energy sector leads the sectors with 40% of the total financing, followed by the agriculture sector with 14%, the industry and mining sectors with 13%, in addition to the financial sector with 9%, and transportation with 8%, in addition to other sectors such as health, transportation, water, sanitation, services, communications and others.

Kashgari said that the primary mission of the Islamic Development Bank Group is to build collaborative partnerships between communities and member countries, across the public and private sectors, as well as to promote innovative and sustainable solutions to the world’s greatest development challenges, and to work towards achieving the United Nations Sustainable Development Goals.

This comes in addition to promoting social and economic development in member states and Islamic communities in non-member states, strengthening and expanding the Islamic financial services industry globally, and providing development financing (public and private) with the aim of promoting social and economic development, noting that the bank is currently focusing on the humanitarian aspect through human development, believing that the human element is the most important.

He also reviewed the main methods of financing projects and technical assistance, noting that the bank provides loans on concessional terms, which are mainly allocated to low-income countries, without a profit margin, with service fees not exceeding 1.5% annually over the financing period, which reaches 25 years, including a grace period of 7 years.

He said that the bank also provides technical assistance grants, such as short-term training, capacity building, reverse linkages, and interventions in the fields of science, technology and innovation. In addition, the bank provides a leasing system, through which it provides medium-term financing for the purpose of leasing capital equipment or fixed assets such as infrastructure, machinery, vehicles and oil tankers. He explained that during the leasing period, the state has full control over the assets, and upon the expiry of the leasing period, the bank transfers ownership of the leased asset to the beneficiary as a grant.

He added that the bank provides the service lease system (service financing), which was recently introduced, and covers the provision of technical assistance services to the beneficiary to prepare the project and related activities, which the beneficiary can pay separately, or its costs can be integrated into the financing for any guarantee project resulting from the design and preparation through service lease financing.

It also allows for installment sales and Murabaha financing, through which the bank buys a commodity or asset and then sells it to the beneficiary at a double price paid by the beneficiary in agreed-upon installments. He explained that in these cases, unlike Ijarah financing, ownership of the commodity or asset is transferred to the beneficiary, i.e. the buyer, upon delivery, according to Kashgari.

For his part, Taha Al-Feel, Head of the Procurement Department at the Financial and Project Procurement Department at the Islamic Development Bank’s Regional Office Group in Cairo, said that there are investment opportunities in Africa worth $3 billion, and that the business sector represents the largest part of the bank’s portfolio worth $7.95 billion, followed by goods at $1.76 billion, then consulting services at $517 million, and finally non-consulting services at about $340 million.

Al-Feel added that there are investment opportunities in various economic sectors in Africa, noting that the agricultural sector is one of the most attractive activities for investment, with opportunities worth $0.77 billion, followed by the transportation sector, with opportunities worth about $0.62 billion.

In her speech, Iman Abdel Aziz revealed that the most prominent services provided by the Islamic Corporation for the Insurance of Investment and Export Credit at the Islamic Development Bank are represented in insuring suppliers and offering insurance coverage to exporters and contractors in member and non-member countries, covering their dues against the risk of non-payment by their customers abroad, in addition to insuring letters and credits to cover confirmation of the letter of credit issued to it for the import of goods and services, thus enhancing the creditworthiness of banks in member countries of the Islamic Corporation for the Insurance of Investment and Export Credit.

She added that the institution provides trade finance to protect financial institutions from the risk of non-payment of their trade dues allocated to them by their import and export clients, and investment insurance that covers foreign direct investments against political risks to which the host member state is exposed, such as war, civil unrest and confiscation of property.

This comes in addition to credit enhancement solutions and protecting lenders from the risk of non-fulfillment of their obligations towards member states and state-owned enterprises in eligible projects. These solutions also provide coverage and guarantees for capital market transactions such as sukuk, in addition to reinsurance, as the Islamic Corporation for the Insurance of Investment and Export Credit works with international export credit agencies in member states and globally to create the necessary capacity to support larger business volumes in member states.

The second part of the closing session of the Builders of Egypt Forum witnessed a special presentation on the Arab Bank for Economic Development in Africa, which shed light on the bank’s strategy and its most important features, in addition to presenting the most prominent mechanisms and tools it relies on to support the countries of the African continent, as a major partner.

The presenter, Sameh Azouz, Senior Expert at the Arab Bank for Economic Development in Africa, said that the bank finances 44 non-Arab African countries, noting that 62% of the bank’s capital is contributed by Gulf countries, and confirming that it has pumped financing worth $13.1 billion for about 1,876 operations. He pointed out that the bank has pumped financing worth $7.5 billion for public sector development projects, about $3.9 billion for more than 67 commercial operations, and $1.4 billion for about 29 operations for the private sector.

Regarding the bank’s 2030 strategy, Azouz said that it includes four main pillars, namely investing in infrastructure for inclusiveness, industrialization and innovation, developing agricultural value chains for empowerment, enhancing trade and developing the private sector to achieve growth and create job opportunities, in addition to small and medium-sized enterprises for economic empowerment.

He explained that cooperation between Arab and African countries is not only the main driver of the Arab Bank’s strategy for economic development in Africa 2030, but is also its main distinguishing factor in the strategic development financing market.

The activities of the ninth session of the Builders of Egypt Forum kicked off this Sunday morning, in the presence of Dr. Manal Awad, Minister of Local Development, Eng. Mohamed Shimi, Minister of the Public Business Sector, and Eng. Sherif El-Sherbiny, Minister of Housing, Utilities and Urban Communities, with the participation of Arab and African delegations, to review the mechanisms for exporting the Egyptian construction and building industry and complementary industries to the countries of the region, and to discuss opportunities for exporting the modern Egyptian experience in extensive urban development and the plans of real estate development companies to expand into foreign markets, and to replicate models of distinguished residential and tourism projects abroad, in addition to strengthening the paths of the Egyptian real estate industry export file.

The forum, which is held under the title “Opportunities for Egyptian Companies in Regional Development Plans,” and is organized by Excellent Communications, a subsidiary of the United Media Services Company, reviewed… UMSIn cooperation with the African Federation of Construction Contractors’ Organizations, comprehensive development plans for the region and a map of major projects in light of global conditions and turmoil and the challenges imposed on emerging countries, and opportunities for Egyptian companies to participate in the fields of infrastructure development, construction and building projects, energy and technological infrastructure in light of the modern economic transformation of the Egyptian state.

The forum witnessed many sessions that included ministers, officials, and senior executives of major companies and institutions concerned with the construction and sustainable development sector, real estate development, financing institutions, and local and regional business organizations, to present the complete maps of development and investment in the Arab and African region to Egyptian private sector companies, as the forum includes major brands in the region in the fields of construction and development represented by contracting unions and concerned organizations, which are looking for opportunities to form alliances with Egyptian companies.

The ninth edition of the forum witnessed the participation of a number of leaders of institutions and agencies concerned with development files in Arab countries, most notably the Kingdom of Saudi Arabia, Libya and Iraq, with the aim of presenting a development and reconstruction strategy in neighboring countries with clear terms and foundations that test the region’s aspirations towards reconstruction paths and establish mechanisms for partnership between Egyptian companies and their national counterparts in the countries of the region. The forum is scheduled to include the presence of a delegation of representatives of business organizations concerned with development and investment files in these countries.

The forum hosted a number of international financing institutions that play an important role in supporting development projects and implementing countries’ strategies to achieve the aspirations of their peoples for a better future, most notably the Islamic Development Bank, the African Development Bank, and the Arab Bank for Economic Development in Africa.

Egypt Builders Forum 2024 (2)