BRIDGING FUNDING GAPS
ICD works with its member countries to help mitigate financial risks associated with investments in infrastructure, SMEs, and agribusiness.
BIOGRAPHY
Ayman Sejiny is a highly accomplished financial industry leader and the current CEO of ICD. Previously, he served as CEO of Ibdar Bank BSC, Bank Alkhair, and Barclays Capital Saudi Arabia and Chairman of Open-Silicon and Bahrain Financing Company Group. Sejiny has more than 24 years’ experience in investment and corporate banking in the local, regional, and international markets. He held a senior role in a number of regional and international financial institutions, including Citi Bank and ABN AMRO affiliate in Saudi Arabia. Sejiny holds a BA in finance from Eastern Michigan University.What are the strategic priorities of multilateral development banks (MDB) when addressing challenges in the private sector of developing Islamic countries?
Within the challenging economic environment that the private sector of Islamic countries operates in, development institutions like ICD need to maintain a focus on three main themes: development of SMEs and competitiveness, supporting countries affected by conflict, and boosting financial inclusion. It is very important to work together with the governments of member countries to ensure our actions are aligned with national programs and priorities. Second, ICD's responsibility is to help mitigate the financial risks associated with investments in infrastructure, SMEs, agribusiness, and other industries, especially in difficult markets and unstable geographies. We realize this effort either through the support of tailored programs such as BRAVE in Yemen, or through a range of financial tools such as sukuk issuances, equity capital market transactions, or lines of finance through local financial partners.
What projects can the combination of technology and Islamic finance produce in the long term?
Islamic finance can be applied to all sharia-compliant sectors, and since many of the markets we cover are underdeveloped, it also makes it easier to apply fintech as a greenfield project. We are reliant on mobile phones and the internet in these environments as a means of reaching out to the ultimate beneficiaries. Furthermore, there is the possibility of connecting blockchain with sukuk and capital markets products. Given the high cost of lending, investors are increasingly turning to capital markets to raise capital, with the issuance of a bond/sukuk allowing them to raise significant sums of money over long tenures. These sukuk issuances play a crucial role in bridging the gap between available financial resources from development institutions and the required development needs, which stand at almost USD4 trillion, according to some estimates. Member countries are increasingly demanding socially responsible investment opportunities and have expressed a strong appetite for green sukuk. Moving forward, a substantial amount of investment will be required to finance renewable energy projects, particularly in developing and frontier markets. The market is growing, and having a structured green sukuk using a developed blockchain platform could facilitate the processes and streamline the negotiation timeframes.
What is the key to balancing the tendency of governments in Islamic countries to develop megaprojects to attract international investors?
Green projects are growing exponentially and will continue to attract investors to finance large-scale projects. As part of the broader focus on SMEs, development institutions should concentrate their efforts on ensuring smaller players are part of these projects as sub-contractors. These efforts help grow and stabilize the market and ensure there is a reliable and inclusive economy where everyone can play a role. At the same time, we need to ensure SMEs have strong financial foundations to perform those projects, which is why institutions like ICD play an equally important role in providing funds to SMEs. This financial support will likely witness a major upgrade through our fintech focus, as ICD seeks to get crowdfunding into play and support the related services with big data and AI.
How does urbanization impact ICD's programs and operations?
Urbanization is a global trend that every development institution should adjust to. As such, our role should be dual: help the integration of new players into urban dwellings through our focus on SMEs and support financial inclusion through fintech tools. This dual effort should be inserted in a blended financing program through which the government provides the initial funding, and we provide both financial and training support to young businesses. That being said, development institutions should have an equal focus on urban and rural areas, seeing them as part of the same picture. Indeed, investors rate fintech and agritech as the hottest sectors. Agritech businesses have a fundamental role to play in overcoming productivity issues, and fintech businesses offer new and innovative ways of accessing finance and marketplaces.
BRIDGING FUNDING GAPS
TABLE OF CONTENTS
Interview
Mohammed A. Al-Mowkley , Deputy Minister of Water Services, Ministry of Environment, Water, and Agriculture & CEO, National Water Company (NWC)
NWC leads the Kingdom's efforts to preserve water as a non-renewable national resource and drastically reduce the average per capita water consumption.
read articleInterview
Majed H. Al Saadi , Managing Director, Priority Projects Office (PPO), Local Content and Government Procurement Authority
PPO and ECA act as an accelerator for the realization of Vision 2030 by bridging the gap between the private and public sectors and helping the government diversify the economy in the long run.
read articleInterview
HRH Princess Hala bint Khaled bin Sultan Al-Saud C, Chairman, Saudi Law Conference (SLC) organizing committee & Founder,, Burhan Almarifa
Burhan Almarifa is focused on maturing the legal sector, encouraging innovation, and enabling research and development in KSA through knowledge transfer and consultancy.
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