11th WIEF Opening – HE Dr Ahmad Mohamed Ali, President, Islamic Development Bank Group

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Building Resilience for Equitable Growth

in the Post-2015 Development Agenda

Statement of Dr Ahmed Mohamed Ali

President

Islamic Development Bank Group

Jeddah Saudi Arabia

For 11th World Islamic Economic Forum: Building Resilience for Equitable

Growth,

3-5 November 2015 Kuala Lumpur, Malaysia

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بسم هللا الرحمن الرحيم

الحمد هلل رب العالمين

والصالة والسالم على أشرف المرسلين

H.E. DATO’ SRI NAJIB TUN ABDUL

RAZAK, PRIME MINISTER,

MALAYSIA

H.E. DRAGAN COVIC, CHAIRMAN

OF THE PRESIDENCY, BOSNIA AND

HERZEGOVINA

H.E. YAQUB EYYUBOV, DEPUTY

PRIME MINISTER, REPUBLIC OF

AZERBAIJAN

H.E. SUN CHANTHOL, SPECIAL

ENVOY TO PRIME MINISTER HUN

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SEN, SENIOR MINISTER AND

MINISTER OF COMMERCE,

CAMBODIA

H.E. TUN MUSA HITAM,

CHAIRMAN, WORLD ISLAMIC

ECONOMIC FOUNDATION

مة هللا وبركاتهالسالم عليكم ورح

Excellencies, Ladies and Gentlemen,

On behalf of the Islamic Development Bank

Group, I renew my warm congratulations to the

People and Government of Malaysia and the

World Islamic Economic Foundation, for

increasingly sustaining the high quality and

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relevance of the World Islamic Economic

Forum.

The WIEF is undoubtedly one of the finest

showcases of the Ummah, an excellent

platform for partnership, exchange, and

knowledge sharing on critical development

issues. It is our duty to commend this

outstanding achievement and provide support

for further success.

In this regard, it is my pleasure to reaffirm the

Islamic Development Bank Group’s

commitment to pursue fruitful collaboration

with the Foundation and Malaysia in the

service of the Ummah and the entire world.

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In this special forum, I want to express strong

appreciation to the Government of Malaysia for

the excellent relations since the establishment of

the Islamic Development Bank. Malaysia has

been very active with its initiative of capacity

building program for the Least Developed OIC

member countries in the areas of agriculture,

education and Islamic finance to share

Malaysia’s knowledge, experience and

expertise. In fact, this has been inspirational for

IDB Group’s Reverse Linkage program,

whereby OIC Member Countries themselves

are primary, forefront, and direct agents in the

provision of specific expertise, knowledge,

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know-how, investments, success stories, and

best practices to achieve a win-win outcome.

Excellencies, Ladies and Gentleman,

The theme of the forum “Building Resilience

for Equitable Growth” eloquently reflects some

of the major challenges confronted by

developing countries, especially emerging

market economies, as the global economy is

experiencing some major transitions.

While recovery from the Financial Crisis of

2008 is still to firm up, the global economy is

facing many headwinds: oil prices instability,

exchange rate adjustments, divergence of

monetary policies and the ramifications of

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China’s slowdown on commodity prices and

global trade.

OIC member countries are facing many other

challenges as well. There are more than 60

million people displaced due to conflict and

disasters in the world today. More than 90% of

them come from OIC member countries. In

Yemen last week, not only are people affected

by war, but a category-4 cyclone landed on

them over the weekend. Countries subject to

these tragic challenges will have little chance of

achieving full potentials whilst development

gains are eroded as a result of war and disasters.

The Ummah has no excuse now but to lead in

rethinking how we assist in building resilience

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and preventing conflicts. We are pleased that

the first ever World Humanitarian Summit is

going to be held in an OIC member state Turkey

and the main preparations are led by your very

own Malaysian Dr Jemilah Mahmood. This is

the time we stand behind the opportunities and

IDB will be working closely with the United

Nations and His Royal Highness Sultan Nazrin

Shah who is the co-chairman of the high level

panel for humanitarian financing leading to the

Summit. We must apply all our knowledge on

Islamic social finance and be innovative.

Failing to do so, we will fail the youth and

children and lead us to greater risks of

radicalization. Today, we can classify more

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than 60 various drivers of conflicts, but many of

them are rooted in development deficits. OIC

countries need to place more emphasis on

building resilience to shocks and vulnerabilities

to conflicts through more effective and

inclusive governance and greater collaboration.

The complex causes of conflicts as well as

prevention and early recovery need to be

addressed with collective efforts of all OIC

community as well as international partners

active in humanitarian, peacekeeping, and

development fields.


As you are aware, the year 2015 has been

marked by the adoption of the Sustainable

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Development Goals (SDGs) during the UN

Summit held in New York last September

wherein the Global Leaders set a new global

agenda to end poverty by 2030 and pursue a

sustainable future.

Indeed, the sustainable development agenda

places a clear emphasis on promoting inclusive

growth, reducing inequalities and building

resilience.

There is now a growing consensus among

scholars and development practitioners that

growth cannot be socially transformational if it

fails to translate into shared prosperity. It means

that growth dividends should benefit more to

the poorest and the most vulnerable.

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My vision is for a structural approach, focusing

on the social infrastructure to promote income-

generating activities that will support access to

social services. In practical terms, as we build

schools and health centers, especially in remote

areas, we develop the rural infrastructure as well

for agriculture, pastoralism, and trading

facilities.

I would also like to insist on the importance of

financial inclusion. As a large portion of

population in our member countries lack access

to basic financial services, greater attention

should be paid to extending financial resources

to support excluded people and SMEs.

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Building greater resilience will also be

strengthened through sustained efforts towards

economic diversification, technological

upgrading and innovation, and through

fostering the growth of micro-, small- and

medium-sized enterprises.


The new development agenda covers the means

of implementation, highlighting finance and

partnership. Even the conservative estimates

for a meaningful realization of the SDGs start

from a trillion dollar global financing

requirement annually. Coupled with the

recurrent financial and economic crisis, this

ambitious agenda cannot be achieved by

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relying only on traditional sources of

development finance, and there is an obvious

need for fresh and innovative alternatives. In

this context, I would like to particularly mention

the opportunities provided by Islamic finance.

Islamic finance has strong potential in

promoting financial stability, financial

inclusion and shared prosperity, and

infrastructure development, all contributing to

building resilience for equitable growth.

The principles of Islamic finance can minimize

the severity and frequency of financial crises by

introducing greater discipline into the financial

system and requiring the financier to bear or

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share in the risk of the underlying economic

activity.

When it comes to promoting solidarity and

combating inequality, the implementation of

Zakat principle, complemented by the

establishment of Awqaf, have historically

played a major role in serving the social needs

of the Ummah.

I encourage the authorities in all the Muslim

communities to fully endorse and support these

institutions, the development of which can

address many shortcomings in social and

redistribution policies.

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Likewise, the partnership financing, the core

element of Islamic finance, is an important

source of funding for SMEs that can provide

opportunities for entrepreneurship, jobs

creation and income generation.

Moreover, the growing sukuk industry at the

global level gives a tangible evidence that

Islamic finance will play a major role in

development financing especially for large-

scale infrastructure.

In this regard, I would like to assure you of the

readiness of the entire IDB Group, as a leading

institution in fostering Islamic finance

development, to cooperate with all stakeholders

in developing the requisite enabling

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environment for Islamic finance, establishing

and supporting Islamic financial institutions,

developing Islamic microfinance sector, and

enhancing awareness about Islamic finance.

I believe that together with the WIEF

Foundation and all the Islamic institutions we

can further impulse the growth of Islamic

finance and enhance its contribution in

achieving the SDGs for our Member Countries

and beyond.

In this regard, I call for a stronger partnership

with governments, private sector institutions,

multilateral development banks and donor

institutions, with the view of mainstreaming

Islamic finance into the global financial system

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to improve resource mobilization and financial

inclusion. Considering their critical roles in

achieving the SDGs, IDB Group is organizing a

Side Event this afternoon with the theme

“Financial Inclusion for Achieving SDGs: The

Role of Islamic Finance” and I am very pleased

to invite you all to this event.


I would like to mention another important event

that marked the year 2015 which has a

significant importance for the development

agenda. In fact, the active and energetic G20

Presidency of Turkey during the year 2015

provided an excellent opportunity for all

developing countries to place their development

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challenges in the forefront of the G20 agenda

and also to reinforce dialogue, cooperation and

integration among them for greater progress and

more inclusive prosperity.

The priorities initiated by Turkey during its G20

Presidency, namely, the three I’s: Inclusiveness,

Investment and Implementation are pertinent

and important for developing countries. We all

commend Turkey, the Chair of the G20, for

giving special prominence to the private sector

in the G20 process and initiating within the B20

various working groups and organizing a

number of consultation meetings. In this

context, the B20 Regional Consultation

Forums, held in 8 major cities including Jeddah

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and Baku discussed the most pressing

economic issues and policy priorities for

businesses in these regions.

The newly created global platform of the World

SMEs Forum is timely and most welcome. I

urge our standard setters and policy makers to

engage fully with this forum for addressing

challenges facing the SMEs sector in our

Member Countries, and to develop innovative

tools and products of Islamic finance for SMEs.

In this respect, I suggest the immediate

establishment of a working group, among OIC

institutions and specialized business forums like

WIEF, to study the ways and means of

leveraging support by Islamic finance to SMES,

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through research and exchange of expertise.

The IDB Group is more than committed to

providing solutions in these areas and in

particular the areas of regulations, including the

development of the requisite legal, regulatory,

supervisory and Shariah framework.

The initiatives introduced by Turkey under its

G20 Presidency, are extremely important for the

developing countries as a whole and

particularly the OIC Member Countries. I am

confident that Turkey, Indonesia and Saudi

Arabia, the three OIC Members Countries-

members of G20, will pursue these initiatives

and particularly the role of Islamic finance in

ensuring more robust and inclusive growth.

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In conclusion, and in view of the tragic situation

that a number of OIC Members Countries are

living today, I would like to suggest to the

WIEF to establish a platform for Experts to

provide innovative ideas and to advice OIC

institutions on ways and means to play a more

active role in addressing the enormous

challenges facing the Ummah today.

Further, the 2030 Agenda for Sustainable

Development stimulates action for the 5 Ps,

People, Planet, Prosperity, Peace and

Partnership, which can inspire and guide the

work of this platform.

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Once again, I thank the Prime Minister, the

people of Malaysia, and the World Islamic

Economic Foundation for inviting IDB Group

to this very important Forum. I wish the Forum

successful deliberations in its entire

dimensions: knowledge, business and

partnership.

I thank you all for your attention.

والسالم عليكم ورحمة هللا وبركاته

Documents

11th WIEF Opening – HE Dr Ahmad Mohamed Ali, President, Islamic Development Bank Group