IsDB members welcome Iran's proposal on preferential financing: Minister

Tehran, IRNA - Iran's Finance and Economic Affairs Minister Ehsan Khandouzi has announced that member states of the Islamic Development Bank (IsDB) have welcomed Iran's proposal to establish a new financing mechanism using a preferential rate within the group.

Khandouzi made the remarks on the sidelines of the 50th annual meeting of the Islamic Development Bank (IsDB) group being held in Riyadh, Saudi Arabia.

Based in Jeddah, the multilateral development finance institution is focused on Islamic finance for infrastructure development and has 57 shareholding members.

"The agenda for next year's projects to be financed by the Islamic Development Bank in Islamic countries has been approved by the members, and the proposal of the Islamic Republic of Iran to create a new preferential financing window for members has been endorsed," Khandouzi stated.

He added that the financial burden of this preferential financing arrangement will be shouldered by the shareholders with sound macroeconomic performance, allowing the IsDB to utilize preferential financing methods as an incentive for the first time.

The minister further explained that international and multilateral development banks often use preferential financing to provide special assistance to prioritized projects or those with unique needs, which was previously unavailable at the IsDB.

He stressed that the IsDB group must reformulate effective reform policies and strengthen the principles of governance and ensure economic, financial, and environmental sustainability to overcome challenges.

The Iranian minister proposed that the IsDB should seriously consider investing in research and development of Islamic fintech (financial technology) solutions to improve access to financial services and facilitate financial transactions among Islamic countries.

Iran is ready to share its knowledge and experience to cooperate with the bank and its member countries in that regard, he added. 

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