The Islamic Development Bank (IsDB) Group, the AAA-rated multilateral development bank of the Muslim world, has announced $1.2 billion in funding commitments to support the post-pandemic economic recovery in its members.
The funding commitments, which comprise around 30 memorandums of understanding (MoUs) and agreements signed between the IsDB Group entities and counterpart institutions in member countries in Africa and Asia, were inked during the Group's 2021 annual meetings, held in Uzbekistan's Tashkent.
Deeping cooperation with the host country, the IsDB announced the launch of the Economic Empowerment Fund for Uzbekistan, established in cooperation with the Uzbek government and private sector investors from Saudi Arabia.
The $100 million fund, of which $20 million has been committed by the IsDB, aims to create 100,000 jobs by supporting micro, small, and medium-sized enterprises (MSMEs).
This is the first impact investment fund established in Uzbekistan, said the IsDB Saturday.
In a special address during the annual meetings, which coincided with the 30th anniversary of Uzbekistan's independence, President Shavkat Mirziyoyev hailed the launch of the new fund as a vote of confidence in the country's development and the continued implementation of economic reforms.
In 2019, President Mirziyoyev issued an executive order creating the framework for expanded cooperation between Uzbekistan and the IsDB.
Other commitments to Uzbekistan included a major $200 million investment to support economic development in rural areas of the country.
The IsDB also signed an agreement to finance the second phase of a project devoted to expanding access to oncology services in Uzbekistan by equipping treatment centres and expanding medical training.
Sardor Umurzakov, deputy prime minister and minister of investments and foreign trade of Uzbekistan, who presided over the annual meetings as chairman of the board of governors, hailed the IsDB Group's bold mobilisation of financial resources.
"Uzbekistan is proud to have hosted such a productive edition of the annual meetings. This year, it was crucial that the bank continued to use its financial resources to address the economic needs of member countries. The clear message of these funding commitments is that member countries are stronger and more resilient when they act in unison," Umurzakov said.
Global supply chain disruptions caused by the Covid-19 pandemic have posed a challenge for developing countries.
Prices for key commodities, including basic foodstuffs, have risen dramatically, putting the economic recovery of import-dependent countries at risk.
The Islamic Trade Finance Corporation (ITFC) will provide trade financing to several countries to support the import of strategic commodities, including energy products and foodstuffs.
The Union of Comoros will receive $392 million over the next three years to support food and energy security.
Burkina Faso will receive $100 million to support the purchase of refined petroleum products for the country's energy sector.
The ITFC also signed similar agreements with Guinea and the Maldives, committing $100 million and $75 million, to support the import of fuel and food commodities.
The IsDB signed several agreements focusing on economic development. The bank will also fund two major projects in Benin, with a combined value of $150 million.
The first project will support community health and nutrition in support of Benin's goal of providing universal health coverage by 2025.
The second project will support upgrades to the storm draining system of the capital city of Cotonou to reduce the risks of flooding.
"The Covid-19 pandemic taught us difficult lessons about the fragility of national economies in a globalised world," said IsDB Group Chairman Dr Muhammad Al Jasser. "We are using the opportunity of our annual meetings to ensure that the power of multilateralism can help create stronger, more resilient economies in the long term."
The IsDB has 57 members, comprising one-fifth of the world population. In 2020, the bank approved $6.8 billion in funding commitments.
The banks' response to the Covid-19 pandemic included a $4.56 billion Strategic Preparedness and Response Program (SPRP), which is estimated to have delivered economic assistance to more than 55 million people.