CAIRO: The International Islamic Trade Finance Corporation (ITFC), a member of the Islamic Development Bank Group, said that it financed 36 trade operations at a total value of $1.253 billion in 16 countries in the first half of 2010.
In a statement released Sunday, ITFC said that Egypt’s share of the financing was $386 million from four operations which amounts to 29 percent of total approvals for the first half of 2010. The financing was mainly targeted at public sector projects in crude oil and refined petroleum products.
The ITFC report showed that public sector trade finance operations amounted to $816 million, which accounts for 65 percent of the total finance operations in the first half, while the private sector operations amounted $437.1 million over the same period.
According to the statement, the ITFC’s overall objective of being a catalyst for increased intra-trade insured that the lion’s share of trade financing went to Organization of Islamic Conference (OIC) member countries, which received more than 80 percent or $1.014 billion of the total value of the trade finance operations. Meanwhile non-member countries received $239 million for the same period.
ITFC also said that it managed to increase the amount of resources mobilized significantly during this period. The amount mobilized from external resources reached $476.6 million, representing more than 38 percent of the total value of trade finance operations.
“These results reflect our continued efforts to advance trade by contributing to the development of markets and trading capacities to help member countries do business more effectively, in addition to being catalysts for economic solidarity, to facilitate and develop trade through the establishment of new trade links among OIC member countries,” said Waleed Bin Abdul Mohsen Al-Wohaib, CEO of ITFC.
Although the ministry prioritizes potential trading benefits over political and religious trading blocs, Egypt’s trade with some OIC countries has been growing on the long term showing increased potential for strategic trade cooperation.
Despite the international economic crisis, bilateral trade between Egypt and Turkey, for example, grew during 2009. Between January and November of 2009, bilateral trade between the two countries reached $3.03 billion with Egyptian exports to the Turkey dropping to $563 million and imports from Turkey reaching $ 2.46 billion.
Also, in the period between January and September of 2009, bilateral trade between Egypt and Indonesia reached $560.9 million, with Egyptian exports to Indonesia reaching $65.8 million and Egyptian imports from Indonesia reaching $495.1 million.
Bilateral trade between the Egypt and Malaysia reached $ 614 million in the period from January to August 2009.
In January 2010, Rachid Mohamed Rachid, minister of trade and industry visited Malaysia, Indonesia and Singapore. The visit was “aimed at opening new markets for Egyptian goods in this region, particularly as it represents a large population cluster in Asia,” said Rachid.
Although the ITFC helps in developing trading relations between the more developed OIC states, it still places high priority on the lesser developed states.
"One of the ITFC’s primary objectives is to enhance the economic welfare of least developed member countries and our mid-year financial results reflect this orientation as the volume of trade finance for the Least Developed Member Countries (LDMC’s) reached $501 million or 40 percent of the total finance operations,” Al-Wohaib added.
"Providing LDMC’s with funds for trade helps to bring prosperity by supporting the growth and development of economic sectors that expand and diversify business opportunities, in addition to helping to alleviate poverty through trade financing that contributes to the preservation of jobs and creation of new employment opportunities."
The statement added that, geographically, Asia and CIS member countries accounted for the largest portion of the trade finance volume, representing 51 percent of the total trade finance operations in the period covered.
“This is in line with the general orientation of Islamic Development Bank Group to expand its trade finance operations in Asia while establishing and providing greater trade finance support to countries of the CIS,” the statement explains.
