RIYADH, Saudi Arabia, April 27. Islamic finance is a ray of light to meet growing demand for infrastructure projects, said Dr. Muhammad Sulaiman Al Jasser, Chairman of the Islamic Development Bank (IsDB) Group addressing the panel discussions on Leveraging Islamic Finance for Developing Sustainable and Resilient Infrastructure held as part of the IsDB annual meetings in Riyadh, Trend reports.
He noted that COVID-19 exposed vulnerabilities in infrastructure, draining public resources and reversing development progress.
“One-third of least-developed countries are now worse off than pre-pandemic. Without immediate action, their development outlook could further deteriorate. Least-developed countries hold tremendous economic potential waiting to be unleashed. Boosting investments in social and physical infrastructure is key to reducing poverty, enhancing health and education, and creating jobs. It also strengthens resilience against future shocks, such as pandemics and climate change,” said Al Jasser.
He believes that the world needs long-term solutions, and sustainable infrastructure projects are the answer.
“However, financing these projects requires a paradigm shift. Estimates suggest a staggering US$ 15 trillion infrastructure financing gap by 2040. Traditional public financing mechanisms fall short of meeting the growing demand for infrastructure projects. To address these challenges and mobilize sufficient funding for long-term investments, we need a fresh approach.
This is where Islamic finance emerges as a ray of light. Its asset-based and risk-sharing principles perfectly align with the needs of least-developed countries for long-term infrastructure projects,” he explained.
Furthermore, Al Jasser said Islamic finance, with its emphasis on environmental responsibility, is perfectly positioned to support these endeavors.
“For the last five decades, the Islamic Development Bank has championed Islamic finance. Our strategy revolves around forging strong partnerships, fostering financial markets, and empowering the private sector. Robust governance is crucial to ensure effective risk mitigation within this system,” he added.
The Islamic Development Bank Group (IsDB) is holding its 2024 Annual Meetings and Golden Jubilee in Riyadh from April 27-30, under the Royal Patronage of the Custodian of Two Holy Mosques, King Salman Bin Abdulaziz Al-Saud.
The 2024 Annual Meetings are being held under the theme of “Cherishing our Past, Charting our Future: Originality, Solidarity and Prosperity”, which marks IsDB’s 50 years of fostering socio-economic development in its member countries.
Among other topics, the meetings will also feature roundtable on COP29 with participation of Azerbaijani government representatives.
As the premier South-South multilateral development Bank, the
2024 IsDB Group Annual Meetings and Golden Jubilee are expected to
attract international and regional attention. The Annual Meetings
will feature a series of side events with top-level panelists from
government, international and regional organizations, the private
sector, academia, and civil society.
Ministers of Economy, Planning, and Finance from IsDB's 57 member
countries will participate in the event, along with representatives
of international and regional financial institutions, Islamic
banks, private sector companies, national and international
development finance institutions, international and regional
organizations, NGOs, chambers of commerce & Industry, and business
councils.