Sri Mulyani revealed that Indonesia officially increased its shareholding in the Islamic Development Bank (IsDB) from 12th to 3rd. The special capital increase (SCI) places Indonesia’s stake in IsDB at 8.43%, lower than Saudi Arabia and Libya.
“Post-SCI, there will be dilution for all shareholders, resulting in Indonesia’s final shareholding being 7.94 percent. The IsDB Board of Governors has approved this SCI at the IsDB Annual Meetings on May 12, 2023,” she said on her Instagram account, Sunday (14/5). According to her, IsDB is a multilateral development bank that has comparative advantages.
IsDB is not only the only multilateral development bank that applies Sharia principles, but most of its members are developing countries, so they can help promote South-South cooperation.
Sri Mulyani said that with the increase in shares, Indonesia will gain various benefits both strategically and economically. “Starting from increasing Indonesia’s bargaining position at the IsDB to increasing the potential for IsDB financing up to 3.5-4 times greater,” she added.
In addition, Indonesia can also play an active role directly in the operation of the IsDB, and can also contribute to improving the welfare and poverty alleviation of IsDB member countries. IsDB member countries are usually countries with low-income Muslim communities.
On the other hand, Indonesia can also further encourage the role of IsDB in various development activities in the country, including economic development and Islamic finance. As of December 2022, the Islamic Development Bank has provided US$6.3 billion in financial support to Indonesia.
Through various means such as project financing, trade financing, and provision of technical assistance, this assistance is mainly aimed at sectors such as agriculture, education, industry, and mining.
Source: CNN Indonesia