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GTR: How has the world of trade finance changed since you started out your career? What has been the greatest transformation?

Taha: When ICIEC was starting out, trade finance in the region was quite traditional. Secured lending was the general norm, and there was a distinct lack of support for small and medium enterprises. The scenario has changed perceptibly over the past two decades. We are seeing more and more small-to-medium-sized enterprises seeking out non-traditional solutions like factoring and export credit insurance-backed financing agreements. The biggest change to my mind has been the gradual acceptance by exporters and banks to look at non-traditional financing solutions, and the willingness to tap markets which were deemed to be off-limits a few years ago. Traditionally, exporters in the region were content selling to a few neighbuoring countries. This attitude has changed now, because with increasing competition, everyone realises that they need to follow opportunities, no matter where they may be. This has in effect forced banks in the region to expand their horizons, and to accept credit insurance as security for their trade finance lending.

GTR: What has been your personal career highlight while working at ICIEC?

Taha: I have been with ICIEC since its inception 20 years ago. We started with three staff members, and now have close to 70 staff, and provide support for over US$3bn of exports and investments every year. So it would be fair to say that during my time at ICIEC there have been many career highlights. A major event which comes to mind is ICIEC becoming a member of the Berne Union, which for us was a concrete proof that the Corporation’s business was in line with the best practices of the major credit insurers from across the world. For an ECA which is rooted in a part of the world where credit insurance as a product is still in its infancy, this was a proud moment. We felt membership of the Berne Union was recognition of the role we have been playing in pioneering risk mitigation products in the region. Another event which comes to mind is ICIEC’s being awarded an Aa3 credit rating by Moody’s. This rating, which has been maintained with a stable outlook, is for us testament to the strong business model we have been able to build and manage.

GTR: What has been the most unique product pioneered by ICIEC in the last two decades?

Taha: ICIEC itself as an institution was quite unique when it started out! Most of the products that we introduced in the market were not well known. However the one product which I think has been outstanding is the Documentary Credit Insurance Policy (DCIP). The DCIP is

used by LC confirming banks to protect themselves against the non-payment risk of LC issuing banks, for eligible export transactions. This product was completely unique in our home markets, and met with a lot of success upon launch. We have covered all types of trades under the DCIP, including oil flows, soft commodities, and manufactured goods. The reason the product has been successful is that it is extremely easy to use, and is very cost effective, since ICIEC generally takes a portion of the banks confirmation fee.

Another unique product which we have launched recently is the sukuk insurance product, under which ICIEC can provide an insurance cover to sukuk investors, to protect them against default on the underlying sukuk’s non-payment. Risks covered include both commercial and political risks. This product is aimed at supporting sovereign sukuk issues from our member countries, and is specifically targeted at supporting infrastructure projects. We hope to issue our first sukuk insurance policy soon.

GTR: What are your predictions for the future of ICIEC? And the future of trade?

Taha: ICIEC’s has spent the first two decades of its existence putting in place the infrastructure for a sustainable, mature export credit insurance agency which is able to efficiently serve its mandate of supporting exports from its member countries and investments into its member countries. During this journey, we are proud to say we have been involved in many projects which without ICIEC support, would not have happened. I firmly believe that given the experience we have banked over the course of the past two decades, we will continue to grow and evolve into an increasingly more relevant contributor in assisting member countries by supporting their cross-border trade and investments.

With regard to the future of trade, it appears to be very bright. Governments in the region realise that small and medium enterprises are the backbone of the economy, and therefore, along with supporting mega industrial ventures, they are doing their bit in enhancing support for the middle-market companies as well. With mature markets slowing down, trade volumes in this part of the world will only continue to grow. And we will be right here doing our best to support these trades.

ICIEC MILESTONES

1415H 1994-1995 Establishment of ICIEC as a multilateral export credit and investment insurance entity

1416H 1995-1996 The commencement of the Operations

1419H 1998-1999 Investment Insurance services commence

1421H 2000-2001 Amendment to ICIEC Articles of Agreement allowing insurance of member countries ‘ exports world-wide

1426H 2005-2006 ●● Amendment to ICIEC Articles of Agreement allowing cover of worldwide class investments from anywhere in the world into member countries

●● The IDB Group’s Investment Promotion Technical Assistance Program (ITAP) funded by IDB, ICIEC and ICIEC. Its focus areas in include institutional development, sharing best practices, and information dissemination on investment opportunities in Member Countries

1428H 2007-2008 ●● Assigned first time rating of Aa3 by Moody’s

●● Launching Documentary Credit Insurance Policy (DCIP)

1430H 2009-2010 ●● Berne Union’s full membership

●● Establishment of Aman Union

1431H 2010-2011 Inauguration of the 1st Representative Office (DIFC/Dubai)

1432H 2011-2012 Increase in the authorized capital from ID150 mn to ID400mn (US$625mn)

1433H 2012-2013 Enhanced reinsurance treaty signed with world class firms industry Munich Re and Hannover Re

1434H 2013-2014 ●● Launching of the Sukuk Insurance Product

●● Country membership reaches 41 countries

●● Moody’s confirms Aa3 rating of ICIEC for the six consecutive year.

“WHEN ICIEC WAS STARTING OUT, TRADE FINANCE IN THE REGION WAS QUITE TRADITIONAL.”Dr Abdel-Rahman Eltayeb Ali Taha, ICIEC

Two decades onGTR speaks with Dr Abdel-Rahman Eltayeb Ali Taha, the CEO of ICIEC, which this year celebrates its 20th anniversary. Dr Taha has been instrumental in the evolution of ICIEC as the world’s first credit insurer operating in compliance with Islamic shariah principles.