JAKARTA: The Islamic Development Bank aims to increase its lending this year by 15 percent from $4.5 billion in 2008, helped by raising funds from a planned Shariah-compliant bond, its president said yesterday.
“This year, actually, our plan is to increase (lending) 15 percent but probably it depends on our ability for mobilization of resources, as you know the market is not clear,” Ahmad Mohamed Ali, president of the IDB, told reporters. “We are hopeful we could do more than that if we mobilize our resources because we are now working on (a) Sukuk,” he added on the sidelines of an Islamic economic conference in Jakarta.
The Jeddah-based bank aimed to issue the Sukuk in “a few months”, he told Reuters separately, but declined to elaborate on the possible size or give other details.
Ali said that agriculture was one area where the bank was looking at investments, including to produce rice to be exported back to Saudi Arabia. “Saudi Arabia is ready to invest in infrastructure for projects to encourage (the) private sector in order to invest in agricultural or other potential sectors,” he said.
Ali denied that such investments in land could provoke a backlash in recipient countries. “They’re developing the land,” he said.
Separately, State Enterprises Minister Sofyan Djalil confirmed that Saudi Arabia was interested in investing in rice fields in Indonesia.
President Susilo Bambang Yudhoyono of Indonesia, the world’s most populous Muslim nation, floated the idea of establishing a Muslim fund to channel funds to less developed countries. “I believe it is worth considering whether an Islamic world expenditure support fund can also be established, so that the least developed Muslim countries could directly benefit from the availability of sizable, reserves in the hands of oil exporting Muslim countries,” Yudhoyono said at the launch of the 5th World Islamic Economic Forum in Jakarta.
The Muslim countries should intensify trade among members of the Organization of the Islamic Countries (OIC) as stipulated in its 10-year action programs which recommended 20 percent increase in the total trade volume among Muslim countries, he said.