GLOBAL: Islamic financing activity levels in Central Asia are poised to rise as an intergovernmental regional organization is exploring development initiatives with the IDB to open up opportunities in the landlocked region.
The Economic Cooperation Organization (ECO) and the IDB have agreed to begin studying the potentiality of commercializing the corridor between the Saudi multilateral Islamic financier and ECO’s member nations in Central Asia under a technical cooperation.
“There is an alignment between the strategic objectives of the IDB and ECO. We would like to partner on different projects in Central Asia,” said ECO Secretary-General Ibrahim Halil Akca. Established by Iran, Turkey and Pakistan, ECO members include Afghanistan, Azerbaijan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan, all of which are also members of the IDB.
No specific projects have been outlined yet, but the leaders of the two organizations have identified transport, energy and tourism as key sectors for cooperation, with trade and capacity-building a strong area of focus. These could increase and diversify the exposure of the IDB in the region which has so far been concentrated in the transport segment.
“Focusing on physical structure is not enough. We need to maximize the impact of our intervention so that we can add value to our member countries,” IDB President Dr Bandar Hajjar noted.
A major financier of development projects across the Muslim world, the IDB counts Central Asia as the smallest beneficiary of its funding at US$19.1 billion, or 15% of total IDB Group financing since inception; the largest recipient is MENA (39%). At a country level, none of the top five beneficiaries are former Central Asian Soviet republics: Bangladesh (15.1%), Egypt (8.6%), Pakistan (8.5%), Turkey (8.5%) and Morocco (5.2%). Together, they command about 46% of total IDB Group net approvals, which stood at US$128.8 billion as at the end of the 30th June 2017.