Islamic Development Bank berths in Nigeria

THE GUARDIAN Newspaper- Emeka Anuforo

THE Islamic Development Bank (IDB), yesterday, formally announced its entry into Nigeria with a firm commitment to lead the way in financing capital projects in the country.

The development followed the approval of the board of executive directors of the bank for the establishment of pilot Country Gateway Offices in Nigeria, Egypt, Turkey, Indonesia, and Bangladesh.

The bank, which had been quietly injecting capitals into various projects in Nigeria, announced that till date, it had committed about $470 million (N72.9 billion) in project and trade financing operations in various sectors of the Nigerian economy.

Indeed, total of $4 billion (N620 billion) is expected to be injected into the nation’s economy in the next three years.

At an Islamic Banking-Nigeria Business Forum in Abuja yesterday, the bank and the Federal Government sealed a $98 million (N15 billion) pact to implement the Bilingual Education Programme in Nigeria.

The programme would support government’s policy to integrate and modernise the Almajiri system into formal schools and promote units and understanding, with a positive impact on Millennium Development Goal educational goals, and inclusive and value-based education.

The programme is expected to get the Almajaris out of the streets and give them an equal opportunity to compete for jobs and earn a descent living.

Meanwhile, President Goodluck Jonathan has called on the bank to support government’s infrastructure and general economic development by voting greater funds for Nigeria.

Represented by the Vice-President, Mohammed Namadi Sambo, he said: “Nigeria, being an important member of the bank, is looking forward to such an opportunity to facilitate the re-building of its infrastructure, revamping the manufacturing sector and creating employment for our teeming youths.”

Speaking on how the economy is performing, the President noted: “Our per capita income is expected to rise from $1,222 to $1,450. Inflation has also fallen from 12 per cent at end of 2010 to 10.3 per cent at present.”

President of the IDB Group, Dr. Ahmad Mohamed Ali, used the opportunity provided by the forum to disabuse the minds of Nigeria about the Islamic banking system.

He said: “The Islamic Development Banking Group is not a religious institution. It is a multilateral development finance institution similar to the World Bank, the African Development Bank, the Asian Development Bank and the Inter-American Development Bank.

“Like those institutions, the Islamic Development Bank seeks to promote the socio-economic development of its member countries by providing financing and technical support to critical priority development projects.

The difference from other institutions is that the modes of IDB financing are based on Islamic finance principles which are based on the productive relationship between financial assets and real economic development aspirations.”

He added: “Unlike the other multilateral development banks, the IDB does not deal with interest. Another distinctive feature of the IDB is that the membership of the IDB is composed entirely of developing countries, all in the Southern hemisphere countries which have broadly similar constraints and development challenges. In its lending activities, the IDB promotes solidarity among its member countries.”

He listed some of the many intervention projects the bank was undertaking in Nigeria to include as the National Programme for Food Security, Zungeru dam project, Mambilla hydroelectric dam project, Lagos-Ibadan Expressway project, National Railway Rehabilitation project and the Shagamu-Benin dual carriage project.

Ali stressed that the IDB had been rated Triple-A by the world’s leading rating agencies for almost the past ten consecutive years, before, during and after global financial crisis.


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