ITFC plans to expand global reach

Jeddah—The Jeddah-based International Islamic Trade Finance Corp (ITFC) plans to strengthen its global network of offices in an effort to increase the use of sharia-compliant banking in merchandise trade. “We want to be closer to member countries – to do this we need to decentralise our activities,” said Hani Salem Sonbol, chief executive of the ITFC, a member of the Islamic Development Bank Group (IDB). The ITFC, which currently has offices in Jakarta, Dakar and Istanbul, will move more staff there and open a branch in Dubai this year to serve as a gateway to Africa, he added.
Islamic trade finance, which follows religious principles such as a ban on interest, accounts for only a tiny fraction of the trillions of dollars of bank-intermediated trade finance conducted globally every year. But the ITFC, which uses its expertise and funds to facilitate Islamic trade finance, says it is expanding its activities partly through new business with countries outside the traditional core areas of sharia-compliant finance in the Gulf and southeast Asia. Last month, it signed financing agreements with Djibouti, Comoros, Mali and Mauritania, and is exploring transactions in Guyana, the newest member of the IDB Group, Sonbol said.
The ITFC approved transactions worth $6.1 billion in the financial year to last October, up from $5.2 billion a year earlier. It more than doubled financing approvals to sub-Saharan Africa; Egypt, Pakistan and Turkey saw some of the biggest individual increases in approvals. Difficulties in the global economy could dampen further growth but the ITFC aims for around $7 billion of approvals this year, Sonbol said.—Reuters

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