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The Islamic Development Bank Group

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Presentation on theme: "The Islamic Development Bank Group"— Presentation transcript:

1 The Islamic Development Bank Group
Together We Build a Better Future Seminar on Business Opportunities offered by IDB organized by TUSIAD Istanbul, Turkey (30th April 2010)

2 Islamic Development Bank Group
IDB Group Present and Future

3 Contents Vision 1440H (2020) Structure Products and Services
Portfolio and Activity Highlights IDB Group Reform Cooperation with other Institutions

4 Vision 1440H (2020) “ By the Year 1440H (2020) IDB shall have become a world-class development bank, inspired by Islamic principles, that has helped significantly transform the landscape of comprehensive human development in the Muslim world and helped restore its dignity.” 4

5 Mission Statement “We are committed to alleviating poverty, promoting human development, science & technology, and Islamic banking & finance, and enhancing cooperation among member countries, in collaboration with development partners” Source: AHDR

6 Agenda for the Future: Responding to the Development Challenge of the Ummah (The IDB Vision 1440H & OIC 10 Year Plan of Action) The Strategic Challenges Confronting the Muslim World : Achieving healthy human development Securing strong and sustainable economic growth Promoting good governance Strengthening peace and stability Fostering a powerful sense of common identity, consciousness, and empathy Restoring the Image of Islam and the Muslim world Source: AHDR 6

7 IDB: Six Priority Areas
Human Development Agriculture Development and Food Security Infrastructure Development Intra-trade Among Member Countries Private Sector Development Research and Development in Islamic Economics, Banking and Finance

8 Key Elements of IDB Group 2020 Vision
A Vision for Comprehensive Human Development Reforming IDB Facilitating integration of IDB MCs Economies Improving the Image of the Muslim World Key Strategic Thrusts Empowering Women Universalizing Education Promoting Health Alleviating Poverty Expanding Islamic Financial Industry Prospering the People 8

9 IDB Group Organizational Structure
Islamic Development Bank (IDB) Islamic Research & Training Institute (IRTI) International Islamic Trade Financing Corporation (ITFC) Islamic Corporation for the Development of the Private Sector (ICD) Islamic Corporation for Insurance of Investment & Export Credit (ICIEC) 9 9

10 Islamic Development Bank
(IDB) Established in 1975 to foster socio-economic development in member countries and Muslim communities in compliance with Shari’ah. Authorized capital of US$ 45 billion Subscribed capital of US$ 22 billion Paid-up capital of US$ 5.3 billion AAA rating by Moody’s Investors Service, Fitch Ratings, Standard & Poors. Zero-Risk Rating by the European Parliament 10 10

11 IDB Organizational Structure BOARD OF EXECUTIVE DIRECTORS
BOARD OF GOVERNORS Group Shari’ah Board Group Operations Evaluation BOARD OF EXECUTIVE DIRECTORS General Council Group Internal Audit Group Ombudsman IDB President Group Risk Management Group Integrity Officer Group Strategic Planning World Waqf Foundation VP (Fin.) VP (Opr.) VP (CorpServ.) Chief Econ. 11

12 IDB Regional Offices Regional Offices
Almaty Kazakhstan Dakar, Senegal Regional Offices Rabat, Morocco Kuala Lumpur, Malaysia In addition, there are currently 12 Field Representatives in some countries

13 Growth in IDB Membership
Europe: 2 Asia: 26 Africa: 27 Latin America: 1 A Unique Model of South-South Cooperation 56 members spreading over 4 continents 22 countries in 1975 → 56 countries in 2009

14 Shareholders in IDB (As % of Subscribed Capital)

15 IDB Group Products and Services
Financing of Projects (Public and Private) Promoting the Islamic Financial Industry Trade Finance and Promotion Capacity Building and Technical Cooperation Risk Insurance Research and Training Fund/ Assets Management 15

16 IDB Group Special Activities
NGOs and Women-In-Development (WID) Scholarship Programs Science & Technology Program Investment Promotion Technical Assistance Program (ITAP) Trade Cooperation & Promotion Program (TCPP) Special Assistance 16 16

17 IDB Group Special Programs (1)
Technical Cooperation Program (TCP) Capacity Development (exchange of experts, training, etc.) Supporting civil societies through NGOs Supporting women-in-development initiatives Investment Promotion Technical Assistance Program (ITAP) Promote Intra-Investment among OIC MCs Capacity Building of Investment Promotion Agencies Dissemination of Investment opportunities Investment Information Network Intra-Investment Statistics on MCs Trade Cooperation & Promotion Program (TCPP) Exhibitions, Trade Fairs and Buyers-sellers Meetings Capacity Building of Export Promotion Agencies Consultative Meeting on Aid-for-Trade Promote regional Cooperation 17 17

18 IDB Group Special Programs (2)
- Special Assistance and Scholarships Provide Relief & Alleviation of suffering in case of natural disasters Support development of Muslim minorities in non-MCs Scholarships for Muslim communities in non-MCs. M.Sc Program for the Least Developed Member Countries Merit Scholarship Programs for High Technology - Science and Technology Program Capacity development in areas of Science and Technology Inter-Islamic S&T Network IDB Prize for Science & Technology to Promote Excellence in Research & Development Self Reliance in Vaccine Production

19 Modes of Financing Interest-Free Loan Leasing Installment Sale
Construction Finance (Istisna’a) Equity Line of Financing Technical Assistance (Loan & Grant) Murabaha (Trade Financing)

20 Net Approved Financing IDB Group (Since Inception to End 2009)
Type of Operation US$ billion 1- Development Projects 28.14 2- Technical Assistance 0.29 3- Trade Operations 34.78 4- Special Assistance 0.68 TOTAL 63.90

21 Approved IDB Group Financing (Since Inception to End 2009) US$ billion
Net Cum. End 2009 = US$ billion

22 Cumulative Sectoral Distribution (Projects & TAs from OCR)

23 Central Asia Countries
IDB Cooperation Turkey/ Albania and Central Asia Countries

24 Projects IDB/Central Asia Countries and Albania
Number of Projects Amount Albania 23 181.08 Azerbaijan 26 423.90 Kazakhstan 24 446.71 Kyrgyz 111.38 Tajikistan 34 174.66 Turkey 76 990.46 Turkmenistan 12 459.99 Uzbekistan 18 278.05 Total 236 3,066.24

25 IDB projects in Turkey

26 IDB projects in Turkey

27 Projects under implementation
Turkey Project Sector Total cost IDB financing YALOVA AND BOLU SEWERAGE SEWERAGE INCL.STORM WTR DRAINAIGE,WASTE TRMT 73.45 45.07 6.53 RAILWAY TRACKS LAND TRANSPORT: ROADS,HIGHWAYS,RAILWAYS 366.18 153.64 THE ELECTRIC LOCOMOTIVES 389.00 220.00 THE ENHANCING ORGANIC FARMING AGRICULTURAL AND LIVESTOCK PRODUCTION 0.36 0.29 SYRIA-TURKEY INTER-REGIONAL CO OPERATION PROGRAM (STICP) General finance 21.00 0.50 DEVELOPMENT BANK OF TURKEY (DBT) NDFIs/IFS / NDFI 40.00

28 Business Opportunities

29 How to Learn About Business Opportunities?
Business Opportunities Bulletin on IDB Approved Projects: published after each BED meeting Procurement Notices: published on IDB website (www.isdb.org), international newspapers, national gazettes and distributed to Embassies & Consulates of MCs In some cases : Procurement notices published on DG Market website (www.dgmarket.com/) 2929

30 Business Opportunities
Active IDB Operations Offering Business Opportunities

31 Energy Country Project Total cost (in US$) IDB financing (in US$
AZERBAIJAN KHACHMAZ ELECTRIC SUBSTATION AND TRANSMISSION LINE 16.78 13.51 MINGECHAUR HYDRO POWER PROJECT (PHASE-II) 105.00 80.00 JANUB POWER PLANT 956.03 201.53 KYRGYZ 110 KV AIGUL TASH TO SAMAT TRANSMISSION LINE SUBSTATION 13.72 11.99 TAJIKISTAN POWER REHABILITATION PROJECT 62.44 9.29 MINI HYDROPOWER PLANTS IN THE RURAL AREAS 11.59 9.18

32 Energy TAJIKISTAN REGIONAL POWER TRANSMISSION INTERCONNECTION PROJECT
50.00 10.00 UZBEKISTAN 500 KV SYRDARYA - SOGDIANA TRANSMISSION LINE 42.56 15.85 9.24 500 KV GUZAR-SURKHAN TRANSMIS SION LINE SUBSTATIONS 128.40 42.00

33 Transportation Country Project Total cost (in US$) IDB financing
ALBANIA CONSTRUCTION OF BUNA BRIDGE 9.55 8.57 DURRES-MORINE ROAD 47.19 10.00 DURRES-MORINE ROAD (KALIMASH- REXHEPAJ SECTION) 30.00 RECONSTRUCTION OF SECONDARY LOCAL ROADS 44.00

34 Transportation ALBANIA RECONSTRUCTION OF SECONDARY LOCAL ROADS 44.00
10.00 AZERBAIJAN RECONSTRUCTION OF UJAR-YEVLAKH ROAD. 31.05 22.00 RECONSTRUCTION OF YEVLAKH TO GANJA ROAD 28.00 10.40 KAZAKHSTAN RECONST. OF 58 KM ROAD SECTION OF SOUTH-OBLAST-TARAZ 195.40 170.00 REHABILITATION MODERNIZATION OF BARTOGAY WATER RESERVOIR 0.44 0.31 KYRGYZ RECONSTRUCTION OF TARAZ-TALAS SUUSAMYR ROAD 10.95 9.15

35 Transportation KYRGYZ RECONSTRUC. OF OSH-IRKESHTAM ROAD 19.80 17.30
TAJIKISTAN KULYAB-KALAIKHUM ROAD 92.90 20.00 TARAZ-TALAS-SUSAMYR ROAD (PHASE II) 12.77 11.20 RECONSTRUCTION OF BISHKEK-TORU GART ROAD 69.25 16.95 CONSTRUCTION OF SHAGON-ZIGAR ROAD, PHASE (II) 15.90 13.77 TURKMENISTAN BEREKET-ETREK-TURKMENISTAN-IRA N BORDER RAILWAY (1431H) 1,414.61 189.90 BEREKET-ETREK-TURKMENISTAN-IRA N BORDER RAILWAY_(1432H) 181.30 UZBEKISTAN ROAD CONSTRUCTION AND MAINTENANCE EQUIPMENT 14.99 12.56

36 HEALTH Country Project Total cost (in US$) IDB financing (in US$
ALBANIA DURRES GENERAL HOSPITAL PHASE-II PROJECT 8.22 7.05 KAVAJA GENERAL HOSPITAL 8.76 5.69 TAJIKISTAN CONSTRUCTION AND EQUIPPING OF DANGARA GENERAL HOSPITAL 17.23 10.51 TURKMENISTAN ARCHMAN MEDICAL HYDROTHERAPY CENTER 18.81 10.38 UZBEKISTAN STATE MEDICAL EMERGENCY HOSPITALS (SMEH) EQUIPMENT 29.30 23.80

37 Agriculture and Rural Development
Country Project Total cost (in US$) IDB financing (in US$ ALBANIA CONSTRUCTION OF DURRES FISHING PORT 10.05 8.77 AZERBAIJAN SAMUR ABSHERON IRRIGATION VELVELICHAY-TAKHTAKORPU CANAL 42.60 10.10 KYRGYZ MICROFINANCE PROJECT FOR RURAL AREAS 5.00 KAZAKHSTAN KAZAGROFINANCE LINE OF FINANCING 30.00 NURBAK LINE OF FINANCING 10.00

38 Agriculture & Rural Development
KYRGYZ REPLENISHMENT OF FOOD SECURITY STOCKS-PHASE I JED DECLARATION 0.70 MICROFINANCE PROJECT FOR RURAL AREAS 10.05 0.30 TAJIKISTAN 20.08 0.33 PRODUCTION OF IMPROVED SEEDS OF WHEAT (JED. DECARATION) 0.40 DANGARA VALLEY IRRIGATION NETWORK (PHASE II) 30.48 13.17 PRODUCTION OF IMPROVED SEEDS O F WHEAT (JED. DECLARATION) 10.00 1.00

39 Agriculture and Rural Development
UZBEKISTAN IRRIGATION DRAINAGE NETWORK IN DJIZZAKH SYRDARIA REGIONS 93.21 52.65 GLOBAL LINE OF FINANCING TO THREE BANKS FOR SMES 15.00

40 INDUSTRY AND MINING Country Project Total cost (in US$) IDB financing
KAZAKHSTAN ESTABLISHMENT OF A LAB. FOR HALAL CERTIFICATION OF FOOD 0.48 0.32 TURKMENISTAN PROCUREMENT OF TWO NEW OIL TANKERS 32.00 31.00 F.S. OF SILICON PRODUCTION FROM KARAKUM SAND 0.33 0.30 UZBEKISTAN THE NATIONAL BANK OF UZBEKISTAN 15.00

41 FINANCE Country Project Total cost (in US$) IDB financing (in US$
KYRGYZ DEVELOPMENT OF ISLAMIC FINANCI AL SERVICES INDUSTRY 0.21 0.19

42 EDUCATION Country Project Total cost (in US$) IDB financing TAJIKISTAN
RECONSTRUCTION OF SECONDARY SCHOOLS PHASE II 13.02 10.55 UZBEKISTAN CONSTRUCTION AND EQUIPPING OF VOCATIONAL COLLEGES 12.75 10.50

43 WATER, SANITATION & WASTE MGMT
Country Project Total cost (in US$) IDB financing (in US$ ALBANIA THE WATER SUPPLY SANITATION IN ORIKUM 16.44 13.35 AZERBAIJAN STRENGTHENING THE CAPACITY OF THE MINISTRY OF ECONOMIC DEV. 0.39 0.26 STRENGTHENING THE CAPACITY OF THE CABINET OF MINISTERS 0.38 0.32 TAJIKISTAN DUSHANBE WATER SUPPLY 10.70 9.30 UZBEKISTAN TASHKENT SEWERAGE PROJECT 38.84 35.37

44 IDB Procedures 4444

45 Selection of Contractors
Predominantly, three methods: ICB/MC: ICB limited to Member Countries for several projects. e.g.: Paved roads, Rural and gravel roads, Bridges, Sewerage lines, etc 4545

46 Selection of Contractors
2) ICB: “Open” ICB, not enough qualified companies in member countries, Category B projects e.g.: Viaducts, Railways, Tunnels, Oil refineries, Major power plants, etc. 3) NCB: Projects not likely to attract foreign competition. 4646

47 Selection of Contractors
Other methods International or National Shopping. Direct Contracting. Force Account. Community Participation. 4747

48 Selection of Consultants
Predominantly Short-list of Member Country firms. . Exceptional cases Short-list of non-member country firms. 4848

49 Procurement Trends “IDB considers that as a matter of priority, goods and works it is financing, should be procured to the extent possible from its member countries”. And even if the case of open ICB, there is still a provision for a margin of preference of up to 15 percent for contractors from member countries. 60 % of the Bank financed contracts for goods/works in recent years, awarded to contractors from member countries. 95 % for consultancy services.

50 IDB does Encourage Contractors from Member Countries…
ICB/MC: ICB limited to Member Countries projects. ICB: margin of preference up to15% for MC, goods and works. However: - Prior consent of beneficiary/IDB. - Stated in bidding documents. 5050

51 Mechanisms of Control Short-list of non-member countries only on exceptional cases. IDB promotes the transfer of technology by encouraging the participation of domestic firms. Registration of member countries firms or organizations in the Data base of consultants so that the IDB can consider them for short listing for IDB financed projects. 5151

52 Mechanisms of Control Legal Framework - Financial Agreement
- Guidelines for procurement of goods and works - Guidelines for the use of Consultants - standard documents

53 Precautionary Measures
Mechanisms of Control Precautionary Measures Preliminary approval for all the process of procurement (bidding documents, bid evaluation report, draft contracts..)

54 Control Mechanisms in Procurement
Measures in case of misprocurement - Violation of Agreed procedures of the Financial Agreement; - Terms and conditions of the contract are not satisfactory to IDB. Cancellation of portion of financing allocated to the concerned operation.

55 Control Mechanisms in Procurement
Measures in case of Corruption or Fraud, IDB : - will reject a proposal of award; - ask the beneficiary country to take appropriate action to rescind the contract, failing which; - cancel the portion of financing allocated to the concerned operation; - will declare the firm ineligible.

56 Contents IDB Group Reform Vision 1440H (2020) Structure
Products and Services Portfolio and Activity Highlights IDB Group Reform

57 IDB Reform Aspirations
FROM TO Finance Focused Development Focused Infrastructure Centric People Centric Traditional Economic Innovation & Knowledge Development Programs Intensive Economic Dev Internal Driven Partnership Follow Lead (Facilitate) Output Oriented Impact Oriented

58 Proposed Reform: Repositioning IDB Group
Results Oriented Scaled up Leveraging Partnerships A New IDB Group Focused Responsive to Clients Knowledge-Oriented

59 Islamic Development Bank Group
A Strategic Partner for Development

60 Thank you 6060 60


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