Riyadh, Asharq Al-Awsat – The Islamic Development Bank was founded in 1975 as part of the vision and as a result of the aid of King Faisal Bin Abdulaziz, may God rest his soul. The goal of this bank was to support the economic and social development of the Organization of the Islamic Conference [OIC] member states, as well as the development of Muslim communities present in non-OIC member states, in accordance with the provisions of Islamic Shariah Law. When the Islamic Development Bank was first established many Muslim countries were newly established, having been founded following independence from colonialism. These countries represented a scene of division as a result of the Soviet bloc attempting to win over newly independent countries, exploiting their feelings of hatred towards imperialism which could be seen in their hatred towards everything western and capitalist. In addition to this, these newly independent Islamic countries were suffering from poverty and underdevelopment, leaving them as easy prey for these forces, as well as an arena for their influence. The idea of an “Islamic development bank” came about as a result of this, and in order to complete King Faisal’s vision with regards to Islamic political and economic solidarity. Therefore the shareholders of the Islamic Development Bank are all members of the OIC, with Saudi Arabia being the largest shareholder with a 24 percent stake in the bank, as well as being host to the bank’s headquarters.
Since its foundation, the Islamic Development Bank has sought to achieve its goals in a professional manner, and the bank has been awarded the highest credential classification of AAA [from Standards and Poor Credit Rating Agency]. This professionalism can be seen in the bank’s establishment of numerous specialist financial institutions which enable it to achieve its objectives. One of the goals of the Islamic Development Bank is the development of the private sector in the Islamic world, and as a result of this the Islamic Corporation for the Development of the Private Sector [ICD] was established by the bank 11 years ago. The ICD was founded in order to serve as a window onto the private sector, as well as the private sector’s financial arm facilitating investment and support to this sector through direct assistance to private sector companies, whether this is through direct [financial] investment or providing [financial] consultancy services. With regards to the investment and assistance provided by the ICD, this institute focuses upon development, thereby creating job opportunities and contributing to the transfer of technology, establishing new industries and achieving integration between member states. The ICD was established with a working capital of one billion dollars, and it has spent 500 million dollars of this. However less than three years ago, a decision was approved to double the ICD capital to two billion dollars in order to strengthen its ability to carry out its duties.
Since its foundations, ICD operations have amounted to approximately 1.8 billion dollars, and two years ago – despite the global financial crisis – this institution had witnessed a 10 percent growth in net income, along with a 12.45 growth in the value of assets. Perhaps a large part of this development is due to (after God) the qualified cadres employed by the ICD, and their vision and sense of responsibility. These cadres were recruited in order to develop the operations of the ICD and serve its objective of developing the Islamic world, strengthening economic ties between Muslim countries and increasing the partnership between business sectors in Muslim member states.
However in my view, one of the most prominent achievements of the Islamic Development Bank administration can be seen in its desire to help its host country and largest shareholders, Saudi Arabia, take advantage of ICD services by strengthening the partnership between the ICD and the [Saudi] private sector. The ICD has, along with a number of businessmen, established the ‘Iwan Real Estate Development’ company and the ‘Anfal Stock Exchange’ company. The ICD, in collaboration with the Public Investment Fund, is also seeking to establish a company to finance Real Estate in Saudi Arabia with capital of two billion Riyals (533 million dollars), with 400 million Riyals of this (107 million dollars) coming from the Public Investment Fund. There are many other projects and investments in Saudi Arabia that are on the ICD’s agenda. In addition to this, the ICD is providing numerous excellent investment opportunities in many Muslim countries and communities to Saudi investors who were previously unaware or afraid to pursue such opportunities. This includes investment opportunities in the Muslim Republics of the Russian Federation, as well as investment opportunities in certain African countries where a [Saudi] company’s investment enjoys international immunity due to the company’s affiliation to the Islamic Development Bank which is classified as an international financial institution.
The business community in Saudi Arabia has been invited to benefit from the operations of the ICD by seeking to receive funding and utilizing the investment opportunity on offer through the ICD due to the expertise and professionalism of its staff. The ICD also gives Saudi investors the ability to access international financial markets and the ICD’s network of relations with many financial companies across the Islamic world.