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Special Edition on Partnering for Development Global Partnership for Development: Our Challenge

NGOs: Reaching the GrassrootsKuwait marks 50th Anniversary

Uniting against Poverty

A P R I L 2 0 1 1

PUBLISHERS

THE OPEC FUND FOR INTERNATIONAL DEVELOPMENT (OFID)

Parkring 8, P.O. Box 995, A-1010 Vienna, Austria

Tel: (+43-1) 515 64-0; Fax: (+43-1) 513 92-38

Email: [email protected]

www.ofid.org

EDITOR-IN-CHIEF Mauro Hoyer Romero

EDITORIAL COORDINATOR Sam Ifeagwu CONTRIBUTORS Mona Alessa, Suad Al-Mojil, Reem Aljarbou,

Turki Al-Muaikil, Tamanna Bhatia, Malcolm Bricknell, Damelys Delgado, Audrey Haylins, Anna Ilaria-Mayrhofer,

Romulo Martinez, Silvia Mateyka, Chibo Onyeji, Fatimah Zwanikken, OPEC Bulletin Correspondent

PHOTOGRAPHS Rana Wintersteiner (unless otherwise credited) PRODUCTION Susanne Dillinger

DESIGN etage.cc/krystian.bieniek PRINTED IN AUSTRIA Stiepan & Partner Druck GmbH

OFID Quarterly is published four times a year by the OPEC Fund for International Development (OFID).

OFID is the development finance agency established in January 1976 by the Member States of OPEC (the Organization of the Petroleum

Exporting Countries) to promote South-South cooperation by extending development assistance to other, non-OPEC developing countries.

OFID Quarterly is available free-of-charge. If you wish to be included on the distribution list, please send your full mailing

details to the address below. Back issues of the magazine can be found on our website in PDF format.

OFID Quarterly welcomes articles and photos on development-related topics, but cannot guarantee publication.

Manuscripts, together with a brief biographical note on the author, may be submitted to the Editor for consideration.

COVER PHOTO: SHUTTERSTOCK

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APRIL 2011

COMMENT

Fostering partnerships to Unite against Poverty 2

SPECIAL FEATURE

Partnering for development 4

Global partnership for development: Our challenge 6

Delivering impact through coordination and harmonization 10

Partnering with the World Bank Group and the United Nations System 12

NGOs: Reaching the grassroots 15

OFID in the private sector: Building new partnerships as a way forward 18

OFID and Ecobank launch strategic partnershipInterview with Ecobank CEO Arnold Ekpe 21

OFID holds Emerging Markets Workshop 24

OFID hosts Trade Finance Workshop 27

OFID hosts Coordination Group meeting 29

OUTREACH

OFID in the Field 31

Sierra Leone: Water project creates fountain of hope for healthy living 32

Jordan: Quality health care for children and young people 34

Paraguay: Moving forward and paving the way to greater development 36

OFID’s 35th Anniversary commemoration begins 38

OFID Diary 40

Meetings attended by OFID 41134th Governing Board photo gallery 42Loan signature photo gallery 44Visitor highlights 46

DEVELOPMENT COOPERATION

DAVOS 2011 addresses water, energy and food securityPublic-Private partnerships for sustainable future 48

MEMBER STATES FOCUS

Free Independent Kuwait 50

Kuwait marks 50th Anniversary 52

Indonesia prepares for Art Exhibition at OFID 53

OPEC

Qatar to host football World Cup 2022 54

Fostering partnerships toUnite against Poverty

oday’s complex development chal-lenges cannot be addressed by anynational government or development

cooperation agency acting alone. Concertedinternational efforts and a pooling of financialresources are required to resolve the totality ofinterrelated problems peculiar to an increas-ingly globalized world.

Throughout its 35 years of existence,OFID’s preferred method of work has been tocollaborate with a broad range of partners,including national governments, multilateral,regional and bilateral development coopera-tion agencies, the private sector, civil societyand academia.

Particularly noteworthy has been the highdegree of collaboration and procedural harmo-nization with other members of the Arab Coordi-nation Group (ACG). The Group was establishedin 1975 to enhance and synchronize the devel-opment efforts of member agencies in the areaof project evaluation, financing, and monitor-ing, and management of loans. It also seeks toachieve uniformity and consistency in its mem-bers’ development policies and financing proce-dures1. Until now, the ACG have together con-tributed a cumulative total of around US$100billion in financing for development, benefitingdeveloping countries in regions worldwide.

Although the amount of development financ-ing is important, this should not be the soleconsideration or determinant. The risingdemand for support and scarce financing fordevelopment made it all the more importantthat the available resources are used efficientlyand effectively as envisaged by the 2005 ParisDeclaration on Aid Effectiveness and the 2008Accra Agenda for Action. In this vein, OFID hasconsistently placed emphasis on strengtheningpartnerships for development in line with theobjectives of the eight Millennium DevelopmentGoals (MDGs). In mitigating the fallout of theglobal crisis on the poorest countries and theirpopulations, OFID continues to pay specialattention to addressing the twin-challenges ofsafeguarding energy and food security. During2010, a Memorandum of Understanding (MoU)was signed with the World Bank Group, and aFramework Agreement concluded with the Inter-national Fund for Agricultural Development(IFAD), among other institutions.

The MoU with the World Bank Group wasa common response to the havoc wreaked onthe poorest countries by the global economiccrisis, with both institutions acknowledgingthat international development institutionsneeded to be better prepared to anticipate such events in the future and act rapidly and

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cooperatively. The MOU aims at strengthen-ing collaboration between OFID and the WorldBank Group to address several new challenges,with an emphasis on energy poverty, water,agribusiness, the financial sector and tradefacilitation. The Framework Agreement withIFAD enhances the longstanding partnershipbetween the two institutions with a view toattracting investment for promoting agricul-ture and rural development in the South toguarantee food security. The agreement alsoincludes a common pipeline of projects for athree year rolling program covering the period2011-13.

Similarly, a regional agreement was signedwith the Andean Development Corporation(CAF), aiming at stimulating, developing andfacilitating joint activities to support the publicand private sectors of Latin American countries.Effort is equally underway to initial similaragreements with other partner institutionsincluding the Islamic Development Bank andthe Asian Development Bank.

To further promote development in theSouth, OFID has also played, and intends tocontinue to play an active role with non-gov-ernmental organizations (NGOs) and civilsociety organizations (CSOs) focusing on peo-ple, results and efficiency. This collaboration

is centered on core issues such as fightingpoverty and hunger, improving women’s con-ditions at work and home and preserving theenvironment.

Innovative forms of financing for devel-opment are required to foster inclusive eco-nomic growth and development. In respondingto the financial crisis, OFID substantiallyboosted its private sector operations under thePrivate Sector Facility, including with the signa-ture in 2010 of a Master Cooperation Agreementwith the International Finance Corporation. Ofparticular note are contributions to global ini-tiatives designed to reduce the impact of theeconomic downturn on developing countries,such as the Microfinance Enhancement Facility,the Private Sector Platform, and the Africa BankCapitalization Fund. Similarly, OFID substan-tially increased the level of funding dedicatedto boost trade expansion in the South under itsseparate Trade Finance Facility.

Drawing on 35 years of experience indevelopment cooperation, OFID looks for-ward to strengthening existing partnership fordevelopment and building new alliances aswe Unite against Poverty, and increasingly worktogether to maximize the results of our col-lective development cooperation efforts onthe ground. �

OFID QUARTERLY APRIL 2011 3

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The task of development requires all parties involved to work together to attain desired progress in the lives of those less endowed. The concerned countries, the development finance institutions, non-governmental organizations and, indeed, individuals constitute the development cooperation community. OFID, in 35 years of development work, is convinced that partnering with others should remain the norm. The following pages detail OFID’s commitment to partnership and cooperation.

for development


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poverty and hunger. The impact of thecrises has been particularly severe on the48 Least Developed Countries (LDCs), mostof which are in Africa and are most sus-ceptible to external economic shocks. Thecrises put insurmountable pressure onalready fragile balances of payments andgovernment finances, creating anextraordinarily large and urgent demandfor external financing for development.

It is the primary responsibility ofpoor countries to work toward achievingthe first seven MDGs with the design and implementation of sound nationaldevelopment strategies, including thestrengthening of social safety nets and theefficient use of resources. Ultimately,however, strong multi-polar and inclu-sive economic growth is the overridingfactor for poverty reduction. This, in turn,requires stronger global cooperation on

aid and trade, as envisaged in the eighthMDG: the global partnership for develop-ment (MDG8). For poor countries toachieve the first seven goals, it is criticalthat rich countries deliver on their prom-ises with more effective Official Develop-ment Assistance (ODA), and developmentof an open, rule-based trading system.However, there are signs that the globalpartnership is proving less effective thanhad been hoped.

Gleneagles commitment When the MDGs were set in 2000, thefinancial means to achieve them had notbeen identified. Since then, the globalpartnership on financing for develop-ment has gradually taken shape – at leaston paper – as embodied in the 2002 Monterrey Consensus, and the 2008 DohaDeclaration on Financing for Development.

Global partnership for development: Our challenge

by Fatimah Zwanikken

Poverty has a long history. The perennial challenge of its alleviationhas been on the agenda of development policy making for decades.

A renewed attempt was made by world leaders at the United Nations Millennium Summit in New York, September 2000.

The subsequent eight UN Millennium Development Goals (MDGs)adopted by the summit included a target of reducing extreme povertyand hunger by half by 2015. This represented a new global partnership

to help poor countries escape the poverty trap.

ive years before the 2015 deadlinefor achieving the goals, the overall

level of achievement of the MDGs isbelow expectations. At the High-level Plenary Meeting of the 65th Session of theUN General Assembly on the MDGs (MDGSummit) in September 2010, world lead-ers welcomed progress made toward the goals since the last review in 2005,but they also expressed deep concern that it fell short of what is needed. It was observed that, whereas noticeableprogress had been made in some coun-tries, others, particularly in sub-SaharanAfrica and South East Asia, continue tofall short on all goals.

Since 2005, two dramatic shocks inrapid succession – the global financial cri-sis that started in 2007 and the 2008world food crisis – presented new chal-lenges, pushing additional millions into

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At 0.32 percent of donors’ Gross NationalIncome (GNI) in 2010, ODA remains a far cry from the UN target of 0.7 percentof GNI, and the Group of 8 (G-8) Glenea-gles Commitment to double aid to Africa by 2010 has not been met. Africa hasreceived only about US$12 billion of theUS$25 billion a year increase in net ODAenvisaged at Gleneagles in 2005.

Similarly, the Doha DevelopmentRound of multilateral trade negotiationsorganized under the auspices of theWorld Trade Organization (WTO) hasremained stalled since 2003, mainly overdeep rifts between North and South aboutthe liberalization of trade in agriculture –the livelihood of 70 percent of the world’spoor. Reducing and eliminating trade-distorting measures in agriculture couldplay a key role in helping reach the firstMDG of cutting the number of poor and

chronically undernourished by half by2015 by raising farm productivity, creat-ing employment and improving rural liv-ing standards. However, the most tradedistorting forms of agricultural supportstill dominate in the majority of industri-alized countries. As long as subsidiesremain high in agriculture, developingcountries cannot compete on a level play-ing field with industrialized nations,which in 2009 together spent US$253 bil-lion to subsidize their farmers, dwarfingthe amount they provide for ODA. Inaddition, developing country requests toenhance differential and more favorabletreatment for their trade as embodied inthe WTO inaugural declaration haveremained unanswered.

Most industrialized nations haveadopted preference schemes for exportsfrom LDCs, and several have improved

their market access for these countries.Nonetheless, with relatively high tariffs inagriculture and low-wage manufactures(sectors accounting for about half of LDCs’non-oil exports), market access barriersremain substantial. Trade flows from theLDCs to industrialized nations haveincreased by less than 1 percent since 2004.Today, the LDCs account for less than 1 percent of world trade, and less than 0.5 percent of global non-oil exports.

Since neither trade nor aid couldhelp the LDCs escape the poverty trap,many poor countries have taken multi-ple measures to attract foreign directinvestment (FDI), which has been themost stable amongst all private capitalinflows to the South. FDI can play a criti-cal role in reducing poverty in LDCs, andhas been the most rapidly increasingresource flow to LDCs over the past �

Identifying the location of countries and cities across the globe. School children in the Philippines.

PHOTO: PANOS/GIACOMO PIROZZI


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� decade. Nonetheless, the LDCs receiveless than 2 percent of global FDI, reflect-ing the general trend that the bulk of FDIbenefits very few countries. Many invest-ments are concentrated in a small num-ber of LDCs and have focused on resourceextraction, which do not fully release thepotential for developmental progress thatFDI could deliver.

Keeping the promiseAccording to the UN, the MDGs can andmust be achieved by the 2015 target date.The Action Plan adopted at the end of theMDG Summit Outcome Document, Keep-ing the Promise: United to Achieve the Mil-lennium Development Goals dated Septem-ber 17, 2011, commits world leaders toaccelerate efforts to deliver and fullyimplement MDG8. It was noted that, onthe positive side, progress toward MDG8continued toward debt sustainability andthe transfer of technology transfer, espe-cially information and communicationtechnologies, and access to affordableessential drugs, particularly for HIV/AIDSpatients.

However, the Action Agenda lacksspecific measures related to the scaling upof ODA, new funding to help poor coun-tries adapt to climate change, and imple-mentation of the Doha DevelopmentRound. At the Summit, donors made sev-eral pledges, including US$40 billion forthe Global Strategy for Women’s and Chil-dren’s Health over the next five years,

and US$11.7 billion to support the GlobalFund to Fight HIV/AIDS, Tuberculosis andMalaria over the next three years. How-ever, questions remain about delivery andadditionality.

Since the onset of the 2008-2009global financial crisis, increasing empha-sis has been placed on international col-laboration within the framework of theGroup of Twenty (G-20) to resolve thecomplex problems of systemic risk thattrigged the global financial crisis. Aneffort to complement the MDGs with anew growth-oriented development strat-egy was made by leaders of the G-20 attheir Summit in Seoul, South-Korea,November 2010. The Seoul DevelopmentConsensus for Shared Growth (the SeoulConsensus) and Multi-Year Action Plan setout medium-term outcomes to be deliv-ered in nine key areas.

The MDGs and the Seoul Consensusconstitute important steps toward broad-ening the global consensus and strength-ening the global partnership for develop-ment. However, the Action Plans are byno means exhaustive. The eight MDGsconcentrate mainly on the social sectors,leaving out productive sectors essentialfor reducing poverty and hunger, such asinfrastructure and agriculture. Both theMDGs and the Seoul Consensus leave outthe important global issues of inequalityand the distribution of income, assets –both physical and human capital – andopportunities.

UNIDO: Also working with others to reach the MillenniumDevelopment Goals.


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Also left out are the twin challenges of energy poverty and climate changeadaptation and mitigation. Energy correlates closely with many poverty indicators through its strong links withemployment creation, income, education,health, gender and the environment, andis vital as such for attainment of almost all MDGs. Nonetheless, 1.4 billion people– the majority in sub-Saharan Africa and South Asia – do not have access toelectricity. Clearly, energy poverty – themissing Ninth MDG – should receive the priority it deserves. The G-20 meet-ing in Pittsburg, September 2009 recog-nized the importance of access to energyfor poverty reduction. A heightened inter-national awareness will be required tohelp mobilize the financial resourcesrequired to achieve the objective of uni-versal energy access by 2030.

Similarly, climate change poses a ris-ing threat to development and povertyreduction. It also makes developmentmore costly, with the additional fundsrequired to adapt to climate change esti-mated at US$70-100 billion per year. Tohelp poor countries tackle climatechange, a Green Climate Fund was estab-lished at the 2009 Copenhagen Summit.The Fund would include US$30 billion infast track financing by 2013, and longterm finance of US$100 billion by 2020.As in Copenhagen in 2009, the 2010 cli-mate conference in Cancun, Mexico didnot secure the future of the Kyoto Proto-col, which expires in 2012. Questions alsoremain about the delivery, additionalityand burden sharing of the resources to bemobilized under the Green Climate Fund.

Challenges aheadGiven the mixed results so far, the keyquestion remains what can be done in thenext five years to insure maximum suc-cess by 2015. At a minimum, developedcountries should pursue their support forthe poorest countries by honoring theircommitments relating to the scaling up ofODA in order to help mobilize the esti-mated US$143 -189 billion needed annu-ally to reach the MDGs by 2015, and tohelp LICs overcome the challenges of cli-mate change. Actions also need to betaken for a timely conclusion of the DohaRound, particularly special and differentialtreatment for developing countries inrecognition of food security and ruraldevelopment.

Whereas the availability of adequatefinancial resources will be a major deter-mining factor in reaching the MDGs infull and on time, efforts should also be re-doubled to improve the quality of aid byreducing fragmentation, improvingalignment, and enhancing aid effective-ness and harmonization, as envisaged inthe 2005 Paris Declaration on Aid Effective-ness, and the 2008 Accra Agenda for Action.

Unless we redouble our efforts toassist the most vulnerable segments of theinternational community, most MDGswill remain distant ideals. It is a challengethat should be tackled if the world’s poor-est people are to be given the opportunityto live a life of dignity, free from hunger,want and exploitation. �

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ence of its members, the Group has madeappreciable progress toward maximizingaid effectiveness and cost efficiency,while eliminating duplication and waste.

Respect of peers

Over time, the Group has come to assumea respected position in the global develop-ment arena, drawing praise from UN Sec-retary General Ban Ki-moon and WorldBank President Robert Zoellick, amongothers. In 2005, at the Paris High LevelForum on Aid Effectiveness, the Groupwas singled out by the developing coun-tries for its long-standing commitment tothe notion of “ownership,” which sup-ports the right of beneficiary countries toset their own priorities and take responsi-bility for their own development. Bothindividually and collectively, Groupmembers are prepared to advise but neverto dictate.

Another hallmark of the Group is theunconditional nature of its assistance,which is given free from economic, polit-ical or religious considerations, in a gen-uine spirit of solidarity with developingcountries, of whom the Arab donornations are an integral part. Similarly, theGroup does not, generally speaking, tie

Delivering impact through coordination and harmonization

omprising most of the bilateral andmultilateral development agencies

of OPEC Member Countries, the Coordi-nation Group has collectively providedmore than US$100 billion in developmentfinancing to countries in need across theglobe, its assistance spreading far beyondthe confines of the Arab region.

When it comes to the coordination and harmonization of development assistance, some of the most active practitioners are to befound in the assembly of nine developmentfinance agencies gathered together under theumbrella of the Coordination Group of Arab Aid Institutions, the Islamic Development Bank (IsDB) and OFID*.

* The nine members of the Coordination Groupare the Abu Dhabi Fund, the Arab Bank for Eco-nomic Development in Africa, the Arab Fund,the Arab Gulf Program for United Nations De-velopment Organizations (AGFUND), the ArabMonetary Fund, the Islamic Development Bank,the Kuwait Fund, OFID and the Saudi Fund.

by Audrey Haylins

Since its establishment in 1975, the Grouphas pioneered the concepts of coordina-tion and harmonization, practicing themlong before the same principles wereembraced by the wider developmentcommunity as part of the internationalaid effectiveness movement.

The Group meets regularly at thelevel of heads of institution and twice ayear at the level of directors of operationsto share initiatives, synchronize programsand harmonize approaches and best practices. By pooling information andresources, coordinating efforts and draw-ing on the combined skills and experi-

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its aid to the procurement of goods andservices from preferred sources, a consid-eration that allows for the most cost-efficient use of funds.

Until the early 1990s, the Group col-laborated mostly on project co-financing,coming together to finance large- andmedium-scale infrastructure projects thatwere beyond the scope of a single institu-tion. It also worked at streamlining policies and procedures in importantareas such as feasibility studies, projectappraisal, design and supervision, pro-curement and disbursement. The obviousadvantages of such unification haveresulted in many developing countriespreferring to have their projects co-financed exclusively by CoordinationGroup members.

The bigger picture

Over the last decade or so, the Group hasstarted paying more attention to thematicissues, with each institution playing to itsindividual strengths and leading the oth-ers accordingly. In all cases, the experi-ences and expertise of the lead partner are shared with the Group as a whole,strengthening its knowledge base for thewider benefit of the beneficiary develop-

ing countries. The IsDB and OFID, forexample, are showing the way in tradefinance and the private sector. The Araband Kuwait Funds are jointly champi-oning water and food security, both ofwhich are issues of growing internationalconcern. OFID and the Saudi Fund, mean-while, are pushing forward with theenergy for the poor initiative, looking atways to improve the accessibility, afford-ability and reliability of electricitythrough joint initiatives with the Groupand other members of the internationaldonor community. OFID has also beenresponsible for coordinating develop-ment of the Arab Development Portal, acomprehensive online knowledge andresource center for donors, potentialinvestors and other parties interested inthe region.

Other issues being discussed by theGroup include education – in particularthe need to match higher and vocationaleducation systems with the requirementsof the job market – and micro-financingas a means of increasing productivity andemployment opportunities and alleviat-ing poverty.

At a wider level, the CoordinationGroup – together with the governmentsof Arab countries – is a key partner in the

World Bank’s Arab World Initiative(AWI). Launched in 2007, the AWI seeksto increase the Bank’s engagement in theregion with a view to improving integra-tion and helping to address key areassuch as human capacity building, infra-structure development, competitive-ness, technological advances, financialsector development and environmentalsustainability.

On account of its decades of experi-ence with Arab countries, the Coordina-tion Group is considered by the WorldBank to be a valuable ally in the initia-tive. Meetings take place twice yearlybetween the heads of all concerned insti-tutions, and the Group also attends theannual meeting between Mr. Zoellickand the Finance Ministers of the Arabcountries. OFID has assumed an activerole in the dialogue with the Bank.

The Group has also scaled up its dia-logue recently with the Organization forEconomic Cooperation and Develop-ment (OECD). Although there alreadyexists a strong relationship between thetwo parties, most notably with regard tothe harmonization of aid, the Coordina-tion Group is keen to tap into the otherstrengths of the OECD, especially itsknowledge in the area of reporting. �

PHOTOS: PMAESA SECRETARIAT; SHUTTERSTOCK/NATHAN HOLLAND; ICARDA; BANCO LOS ANDES; SHUTTERSTOCK/ANDRÉ KLAASSEN; SHUTTERSTOCK/A.S. ZAIN; KAVI


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by Chibo Onyeji

Partnering with the World Bank Group and the United Nations System

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rom its inception, OFID has beenof the opinion that, in interna-

tional development practice, partnershipis essential to accomplishing sustainablesocio-economic advancement. With theadvent of globalization, the role of part-nership in international developmenthas become increasingly evident and appreciated by the various stakeholdersintent on greater effectiveness.

OFID was thus convinced from thebeginning that close cooperation withthe World Bank Group (WBG) and theglobal community of nations under theflag of the United Nations System wouldbe essential to realizing the goals and as-pirations it had set itself.

OFID began early cooperation withboth the WBG and the UN to quickly andeffectively move development forward.This cooperation takes three major ap-proaches to reaching OFID’s goals: 1) project co-financing; 2) contributingto the resources of other development in-stitutions; and 3) providing grant financ-ing in support of social and humanitar-ian development projects, HIV/AIDS ini-tiatives, capacity building, research andsimilar activities, as well as emergencyfood and relief operations.

As the years have rolled by, OFIDhas increasingly sought partnershiparrangements as a more effective meansof strengthening its ability to respond tothe challenges of modern times. The in-creasing trend in partnership arrange-ments in international developmentpractice underscores the urgency anddesirability of partnerships in delivering effectiveness. Two important examplesare 1) the Millennium DevelopmentGoals (MDGs), whose attainmenthinges, to a large extent, on Goal 8: todevelop a global partnership for develop-ment; and 2) the Paris Declaration on AidEffectiveness, which is about meaningfulpartnerships between donors and bene-ficiary countries through greater harmo-nization, alignment and managementof aid for results.

Enhancing partnershipWithin the context of the WBG, OFIDand various institutions of the Grouphave continued to address mounting de-velopment challenges. Over the years,cooperation here has progressed into arobust partnership for delivering tangibleprojects and programs in the least devel-oped economies. The partners are con-vinced that the 21st century, in general,and the global economic climate, in par-ticular, obligates international develop-ment institutions to adopt innovative

approaches to their development pro-gramming work. Indeed, in 2010, OFIDand the Bank Group agreed a Memoran-dum of Understanding (MoU) to strengthenpartnership and better coordinate devel-opment programming. The memoran-dum addresses the special needs for over-coming energy poverty and the manage-ment of natural resources, favoring coop-eration in expanding economic and social infrastructure. �

The WBG is one of the world’s largest sources of funding and knowledge fordeveloping countries. In fiscal year 2010, the WBG committed more thanUS$72 billion supporting more than 850 projects to promote economic growth,overcome poverty and promote private enterprise. The Group comprises fiveclosely associated institutions: the International Bank for Reconstruction andDevelopment (IBRD) and the International Development Association (IDA),which together form the World Bank; the International Finance Corporation(IFC); the International Centre for Settlement of Investment Disputes (ICSID);and the Multilateral Investment Guarantee Agency (MIGA).

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The World Bank Group

Mr. Robert Zoellick, President of the World Bank and Mr. Suleiman J. Al-Herbish, OFID Director-General, at the signing ceremony.

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UNIDOOFID and UNIDO have worked togetherin addressing, among other issues, thequestion of energy poverty in developingcountries. UNIDO Director-General, Dr. Kandeh Yumkella, who also holds theChair of the UN-Energy group, has ex-pressed on several occasions that a grow-ing energy access problem has exacer-bated poverty in Africa, and he has calledfor the energy sector to be accordedhigher priority on the developmentagenda.

Because energy underpins all theeight MDGs – its availability and afford-ability being a potent lever of economicand social development – OFID has madealleviating energy poverty one of the cor-nerstones of its lending programs. Ac-cordingly, OFID supports the proposal toEradicate Energy Poverty as a missing MDGNo. 9. Already, in June of 2008, OFIDconvened a Workshop on Energy Poverty inAfrica in Abuja, Nigeria, at which UNIDOalong with other organizations, busi-nesses and government ministries partic-ipated. The conference identified key bar-riers to improving energy access and so-lutions to the barriers.

UNIDO’s current Five-year Plan, inwhich various UN organizations are in-volved, targets energy access and energyefficiency, especially with regard to in-dustry and transport. It also covers re-newable energy for household, industrialand commercial uses. OFID Director-General Al-Herbish has spoken of bothinstitutions’ mutual interest in support-ing the development of affordable en-ergy. UNIDO and OFID are part of agroup promoting the Vienna EnergyForum 2011 with the motto, “Energy forAll. Time for Action.”

OFID’s collaborative work withUNIDO also embraces related areas suchas the environment, trade and the pri-vate sector. As progress in any of theseareas increases the chances of sustainabledevelopment and poverty reduction,each organization has a strong incentiveto ensure successful partnership.

FAOThe Food and Agriculture Organization(FAO) of the UN has a mandate to raisenutritional levels and living standards,to improve agricultural productivity,and to better the condition of rural peo-ples. OFID’s partnership with the FAOinvolves financial collaboration to ad-dress solutions to the problem of foodsecurity such as investment in rural in-frastructure, technology and modern in-puts. Investment in these crucial areas,which are also among the key sector pri-orities of OFID operations, has been lim-ited or inconsistent for several decades.The dearth of such investment over theyears has been described as the “singlestructural cause” of the global food cri-sis by the FAO, which has estimated thatdeveloping country agriculture wouldneed US$44 billion a year, for severalyears, in Official Development Assis-tance (ODA) to solve the food insecurityproblem once and for all.

Among the other UN organs and agen-cies OFID has partnered with are theUnited Nations Children’s Fund(UNICEF); the World Health Organiza-tion (WHO); the World Food Program(WFP); the International Atomic EnergyAgency (IAEA); the United Nations Re-lief and Works Agency for PalestinianRefugees (UNRWA); and the United Na-tions Development Program (UNDP).OFID has supported joint activities withthese organizations to the tune ofaround US$200 million in grant financ-ing for projects such as rural water sup-ply and sanitation, disease eradication,small-scale energy initiatives and oth-ers. The bulk of OFID’s HIV/AIDS workis also carried out in conjunction withUN specialized agencies.

For OFID, therefore, partnershipand cooperation continues to be anoverriding principle of its operations. In an era in which stakeholders are increasingly intent on greater develop-ment effectiveness, building partner-ships remains key. �

Partnering with other institutions in the UN system� Besides working with the WBG, whichis an independent specialized agency ofthe UN, OFID has also developed close re-lationships with other UN institutions,among the major UN agencies and or-gans working with OFID have been:

IFADOFID played a significant role in the es-tablishment of IFAD in 1977, havingchannelled US$861.1 million in contribu-tions from OPEC Member Countries tothe agency’s initial capital and first re-plenishment. In addition, OFID itself ad-vanced a further US$20 million to theagency as a special contribution fromOFID’s own resources. Cooperation withIFAD has enabled the two institutions topool experience, knowledge and re-sources and jointly implement over 60projects in what has turned out to be acontinuously strong relationship.

In December 2010, OFID and IFADannounced an enhanced partnershipthat would promote innovative financ-ing mechanisms to attract private sectorinvestment in agriculture, and developinclusive business models to benefit in-vestors and local small farmers. Thisframework agreement aims at enhanc-ing the scope of existing cooperation,and includes a common pipeline of proj-ects for a three-year rolling program, forthe period 2011-2013. OFID Director-General Al-Herbish described coopera-tion with IFAD as “a cornerstone ofOPEC Member Countries’ commitmentto eradicating poverty and boosting agri-cultural productivity in developingcountries.”

www.ifad.orgwww.unido.orgwww.fao.org


Today, it is estimated that there are over40,000 internationally operating NGOs.Hundreds of thousands more operateregionally or nationally. The vast major-ity demonstrate success in what they do –on a small-scale perhaps, when comparedto the work of the multilateral donors;but at a level, nevertheless, that deliverstangible results and makes a sustainabledifference to people’s lives.

Thirty years ago, NGOs relied heav-ily on public fundraising and private phi-lanthropy to finance their activities. As

respect for their efficiency has grown,however, more and more funding is beingchanneled from governments and otherofficial sources, as well as from a privatesector increasingly eager to showcase itscorporate social responsibility (CSR).Donors, it seems, have unshakeable con-fidence in the ability of NGOs to utilizefunding wisely and effectively.

Unique selling pointWhat, then, do NGOs have that sets themapart from other development partners?According to Heidi Burkhart, ManagingDirector of Hilfswerk Austria International,an NGO with over 60 years experience,the difference between NGOs and the big-ger players lies in their access to civil soci-ety. “Our ability to go in at a grassrootslevel and effectively become one of thepeople is our unique selling point,” shetold the Quarterly. �

With the backing of both the public and privatesectors and unique access to civil society, non-governmental organizations (NGOs) areundisputed experts when it comes to grassrootsdevelopment.

by Audrey Haylins

NGOs: Reaching the grassroots

he World Bank defines them as“private organizations that pursue

activities to relieve suffering, promote theinterests of the poor, protect the environ-ment, provide basic social services, orundertake community development.”With such a broad mandate, it is hardlysurprising that NGOs hold a key positionin the global development alliance. Tack-ling poverty where it really matters, withthe minimum of fuss and red tape, NGOsare seen by many as the natural partnersof the poor.

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the organization – are located in variousoffices throughout the world. Says Ms.Burkhart: “This is one of the principles –to discover the resources, the good peoplewith leadership potential, who alwaysexist and who are waiting for the rightopportunity to contribute to the devel-opment of their own country.”

Getting governments on sideWhile working with civil society is verymuch the raison d’être of NGOs, such effortswould come to naught without the backingof host governments. “Whether a govern-ment is deemed good or bad, it is the insti-tution that leads the country,” HeidiBurkhart states, arguing that it would bewrong to try and substitute this authority.Moreover, she stresses: “Without govern-ment support, a project would have a veryshort life.” NGOs such as Hilfswerk andFPSC thus try to work in alignment withgovernment strategy, embedding projectsin the structure of the country and oftenfilling gaps that might not be addressed inany other way. They also work with otherstakeholders, such as the multilateralfinance institutions, the United Nationsagencies and the European Commission,among others. “For every project, weundertake a thorough stakeholder analysisto see who’s there and who’s doing what sothat we can avoid overlap and duplicationand ensure that every cent of our money iswell spent,” explains Ms. Burkhart.

Because of their dependence ondonor funding, whether from govern-ments or other sources, NGOs are moreaware than most about getting value formoney. “Volatility of financing is an ongo-ing concern,” says the Hilfswerk chief.“Another problem we face is that nobodywants to fund things that go on behindthe scenes, such as knowledge manage-ment and development.” Burkhart admitsto finding this attitude frustrating and saysshe would like to see a change in the mind-set of donors. NGOs, she points out, gener-ally pare their administrative costs to thebone, unlike governments and other largeinstitutions, where bureaucracy very ofteneats up a large share of the budget.

Supporting local prioritiesPilar Lara is the founder and president ofleading Spanish NGO, Fundación Promo-ción Social de la Cultura (FPSC), which hasbeen active in the field of internationalcooperation since 1992. She agrees whole-heartedly with Heidi Burkhart on the roleof civil society and local organizations inthe design and implementation of devel-opment activities: “Experience has shownus the importance of supporting the prior-ities of the people and using local part-ners,” she told the Quarterly. For FPSC,this participatory process includes a writ-ten contract with the partners concerned,committing them to undertake the agreedactions. This, says Ms. Lara, has a doublebenefit: it instills ownership and, simulta-neously, safeguards the sustainability ofthe project.

In keeping with the aim of strength-ening domestic capacities, the most effi-cient NGOs staff their field offices withlocal personnel. Hilfswerk, for example,has only 17 people working out of itsheadquarters in Vienna. A further 80 staff– hand-picked in the field and trained by

� Typically, NGOs shy away from thenotion of donor and beneficiary, prefer-ring to look upon target communities ashuman beings with dignity, knowledgeand resources. “Never underestimatehow innovative people can be in difficultsituations,” says Ms. Burkhart. “Alwaysbear in mind that people know a lot, thatthey want to take responsible for theircountry and just need a little input.” It isimperative, she adds, to talk to benefici-ary groups, especially women, “whooften know exactly what is missing andneeded.”

By working closely with local com-munities, NGOs are able to gain theirtrust and active engagement in projects.Such an approach acknowledges thatchange has to come from within and withthe full participation of the people con-cerned. It also gives communities anopportunity to develop their knowledgeand skills and, at the same time, promotesa sense of ownership and pride in theprojects. Says the Hilfswerk chief: “It’s amatter of empowering in a simple, com-mon-sense way.”

Heidi Burkhart with partners and beneficiaries in the Sudan.

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Key alliances with private sectorIn terms of funding, a growing boon forNGOs has been the burgeoning amountsof financing coming from the private sec-tor in the form of CSR. Pilar Lara reportsthat 56 percent of FPSC’s resources in2010 came from small, medium and largecorporate donors. “This balance betweenpublic and private funding is important,”she says.

Hilfswerk actively promotes itself asan “ideal partner” for companies seekingto expand abroad in a socially responsibleway, and runs a joint program for thispurpose with the Austrian Chamber ofCommerce. “It’s a win-win situation foreveryone involved,” says Heidi Burkhart.Companies gain access to new markets.Local populations get access to services

and jobs. And the NGO gets funding forits projects.

In order to retain the support of theirfinancial backers –whether public or pri-vate – NGOs have to be reliable and trans-parent and, most of all, they have todeliver demonstrable results. For this rea-son, they invest a lot of effort in measur-ing the impact of their work. In manyways, this task is made easier by theirproximity to the local population, whichallows them to view results first hand andadjust practices accordingly.

During her many years with FPSC,Pilar Lara has witnessed a sea change inthe way project evaluations are carriedout. “It is no longer adequate to measurethe effectiveness of a training project forwomen, for example, by counting the

number of courses taught or how manywomen attended,” she states. “Today, wewant to know if the course has enabled awoman to secure employment or if hernew skills have helped her find a better,higher-paying job.”

In the interests of transparency,most NGOs also subject their projects to independent, external evaluation.According to the FPSC president, this is an“extremely comprehensive process,” inwhich experts assess the impact of a proj-ect in terms of effectiveness, efficiency,relevance and sustainability, seeking theviews of all actors involved, especially thebeneficiaries. It is also an invaluable wayof learning lessons for future interven-tions and maintaining the excellence forwhich NGOs have become renowned. �

Reaching the grassroots also involves attracting the very young to get them involved early. The future belongs to them.

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OFID in the private sector: Building new partnerships as a way forward

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by Malcolm Bricknell

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he issue of international aid effec-tiveness and donor cooperation has

become increasingly important in recentyears for all the leading DevelopmentFinance Institutions (DFIs), includingOFID. Both partner countries and inter-national financial institutions (IFIs) haverealized that lack of collaboration hadplaced a huge burden on developingcountries and made development aidmuch less effective. Accordingly, IFIs arenow working more closely together toharmonize development activity and toincrease needed impact and outcomes.

OFID prioritized cooperation andpartnership from its very beginnings. Co-financing has always been a major part ofthe modus operandi of OFID. By activelycooperating with other institutions, OFIDhas been able to implement ambitiousdevelopment projects and programs. Infact, within seven years of its establish-ment, OFID had extended concessionalfinance to about 170 projects and pro-grams in more than 80 countries. The per-formance of IFIs is normally measured bycriteria such as the number of loans madeannually, the number of beneficiarycountries and the social impact, the ratioof disbursements to commitments andthe ratio of administrative costs to dis-bursements. Using such criteria, the per-formance of OFID has been impressive.This success has been substantially due toOFID’s pragmatic policy on partnershipand cooperation.

As the years have rolled by, OFID, inits forward march has developed newfinancing mechanisms (windows andfacilities) aimed at reaching out to abroader sweep of players and stakeholdersin the quest for social and economicadvancement in developing countries.OFID introduced such new financingwindows as the Private Sector Facility andthe Trade Finance Facility. Their introduc-tion has required OFID to extend its net-work of cooperating partners to includeinstitutions active in these areas.

OFID’s approach to working withprivate enterprise is transparent andstraight forward. For the private sector, as

well as in general for trade finance, OFIDdoes not typically rely on other arrangersfor clear-cut projects, in particular thosein the financial sector. However, in orderto operate efficiently and at a high techni-cal standard OFID needs to cooperatewith other financial institutions in theco-financing of larger and more complexprojects. In these cases, a lead arrangermay produce an information memoran-dum, financial model, terms sheet, etc;which can save OFID valuable time. Leadinstitutions also assist in the monitoringand effective implementation of projectsand will coordinate action and enforce-ment in the case of a problem loan. So, inmany ways, the general approach of OFIDfor its new windows has followed the tra-ditional approach for the public sector.

One important opportunity for coop-eration between both the public and pri-vate windows of OFID, as well as with otherinstitutions, arises from Public Private Partnerships (PPPs). Combining conces-sional and commercial sources in PPPs hasbecome increasingly important in findingsolutions for development finance. Fund-ing for such projects is separated into private sector and governmental compo-

nents. OFID has been able to contribute toboth sides, due to having windows forboth the public and private sectors.

In the area of trade finance, OFID hasimplemented funding directly to govern-ments and parastatals for strategic com-modity imports and has worked withcommercial banks in providing liquidityfor trade finance. One significant cooper-ative transaction has been a US$500 mil-lion risk sharing program with StandardChartered Bank. This program, signed inSeptember 2009, covered over 80 banksin 18 countries for estimated trade vol-umes of US$2 billion per annum.

OFID recently cooperated with otherleading DFIs in establishing the CurrencyExchange Fund (TCX). This company takeslong-term local currency exposures on aportfolio basis due to IFIs pooling theirlocal currency interests together. Thiscooperation creates a more complete riskspreading and efficiencies of scale. Theinvolvement of OFID in TCX has allowedOFID, like other leading IFIs, to offer localcurrency funding solutions to clients,thereby mitigating their foreign exchangerisk and so reducing the risk of projectfailure. �

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Welding and industrial works.Private investment in industrypromises to help accelerate development.


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� The need for close cooperation betweenIFIs was again highlighted by the recenteconomic and financial crisis which fol-lowed the collapse of the US sub-primemortgage market. OFID was asked to con-tribute to a series of crisis response initia-tives at the same time as increasing its reg-ular funding, to allow its partnercountries to maintain vital infrastructureand social sector projects.

The Global Trade Liquidity Programwas one International Finance Corpora-tion (IFC) initiative for providing financ-ing to commercial banks in the wake of the financial crisis. OFID participatedin the program with US$100 million.Another initiative from the IFC was theAfrica Bank Capitalization Fund. ThisFund makes equity investments for recapitalizing private sector banks in sub-Saharan Africa. OFID agreed to a commit-ment of US$30 million. A further initia-tive was the Microfinance EnhancementFacility which has provided funding toMicrofinance institutions to ease the liq-uidity crunch, to which OFID has com-mitted US$15 million.

The recent increase in the level of cooper-ation between IFIs has led to a desire tofurther streamline procedures with a viewto making cooperation more effective. So,in April 2010, a Master CooperationAgreement was signed between IFC andOFID. This Agreement provides that doc-umentation and procedures will be stan-dardized for transactions where IFC is thelead arranger and OFID is co-financing.Furthermore, OFID has quite recentlyentered into a number of Memoranda ofUnderstanding (M0Us) with leading IFIs,including the World Bank Group, Inter-American Development Bank and IFAD.These M0Us typically provide forexchanges of ideas on sectors, productsand institutional development and coop-eration on projects (identification,appraisal and loan administration).

The MoU signed in October 2010between OFID Director-General SuleimanJ. Al-Herbish and World Bank PresidentDr. Robert B. Zoellick was an importantstep toward enhancing OFID’s activitylevels with this preeminent institution.It covers all of the main constituentorganisations of the World Bank Group(IBRD, IDA, IFC and MIGA). Further-more, it has coincided with a number ofkey initiatives of strong interest to bothorganisations such as energy for the poor,food security, Middle East initiatives andothers.

In conclusion, it can be seen thatcooperation with both partner countriesand other IFIs is central to the work ofOFID. Over time, priorities have changedalong with the prevailing developmentparadigms. The scope of OFID’s opera-tions has also changed dramatically withthe introduction of its new financingwindows covering the private sector andtrade finance. However, one constant isthe need for close cooperation and effec-tive partnership with both cooperatingcountries and with other institutions.This is innate to OFID and its ways ofworking. �

In Cambodia, production of Soya milk.

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OFID and Ecobank launch strategic partnership

OQ: Does Ecobank see itself differently toother banks in the region because of its Afri-can roots?

AE: I think so. We certainly feel that weare more than a bank, that we representalmost a movement for the advancementof Africa. We are very proud of certainthings. We have managed to have theAfrican private sector – anglophone, fran-cophone, lusophone – working together,which is very unusual. We’ve also beeninstrumental in prompting regionalintegration, creating larger regional grou-pings and products than enable regionalintegration. We see ourselves as a statelessbank. We have a regional DNA.

OQ: Since you took the helm in 2005, Ecobank has undergone phenomenal growth,increasing its assets from US$2.2 billion inDecember 2005, to US$9 billion as ofDecember 2009, and expanding outreachto 30 countries. How have you managed thisgrowth in terms of institutional capacity?

AE: I think we set ourselves a challengefrom the beginning. We wanted to bePan-African sooner rather than later.And we accepted that there would be acost to that growth. A strategic analysisshowed that what we call “MiddleAfrica” has enormous potential. Thedemographics are very good – fifty per-cent of the population is aged 20 or

younger; it is fast growing; it has abun-dant natural resources; it is highlyunderbanked – penetration is less than10 percent in many countries; and it isalso less competitive in many ways. Sowe felt this was an opportunity for us,and we decided to move into that mar-ket as aggressively as we could. In termsof cost, we knew that we would have tolook for people and invest in their trai-ning and development, and also that wewould have to invest significantly intechnology. What we’ve tried to do isbalance things in such a way that, alt-hough we are growing geographically,we are not creating systems and proces-ses that we cannot handle. �

Following signature mid-March of a US$30 million loan agreement, Ecobank Transnational has become OFID’s newest partner in Africa. In the following interviewwith Audrey Haylins, Ecobank Chief ExecutiveOfficer Arnold Ekpe describes the bank’sAfrican roots, its phenomenal growth and itsdouble bottom-line approach to business.

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� OQ: What would you say are the key chal-lenges and opportunities for the banking sec-tor in Africa?

AE: Actually, I like to look at the challen-ges as opportunities. For example, thecontinent has an emerging middle-class,and it’s both a challenge and an opportu-nity to develop financial products forthem. Infrastructure is another challenge:almost every branch of Ecobank has itsown generator because the public powersupply is not reliable. But, there areopportunities there too, to help developthe energy sector. The biggest challenge,however, is people. We need to attractpeople internationally to support andstrengthen our internal talent pool.

OQ: How does the banking system in Africadiffer to other regions?

AE: It differs in several fundamental ways.I have worked in the UK and in SouthAfrica, and if you look at a market likeEurope, the potential for growth is verylimited. A lot of the profitability and per-formance comes from containing costsand not from growing. We don’t havethat problem yet in Africa, because ban-king penetration is so low. The secondthing is, we’re still at a very early stage interms of sophistication and productvariety, so the financial sector on the con-

tinent is still broadening and deepening.Africa’s story is a growth story, not a costmanagement story.

OQ: Ecobank describes itself as the Pan-Afri-can Bank. How do you justify this statement?

AE: We say we are the only true Pan-Afri-can bank in the sense that we are presentin more countries in Africa than anyother bank in the world. Also, althoughwe’re located in West Africa, we have 35nationalities in the bank. We’ve tried inmany ways to be pioneers, not just interms of a Pan-African footprint but alsoin terms of trying to push certain initiati-ves that we feel are in the long-term inte-rests of Africa. So, for example, our mis-sion/ vision says that we will build aworld class Pan-African bank and at thesame time contribute to the develop-ment of Africa. We sometimes hear fromour competitors that we have an Africanstrategy. My reply is always, no we don’t;Africa is our strategy.

OQ: You are very clear in your annual reportabout being committed to a double bottomline, i.e. delivering superior returns for share-holders, while showing concern for the wel-fare of the communities in which you ope-rate. How does Ecobank integrate these twoprinciples?

AE: We do it at several levels. The thingabout banking is that if the communitiesyou are serving do well, then you do well.So in many ways, it is self-reinforcing. Butwe also, as a matter of policy, dedicate upto one percent of our profit after tax forcorporate social responsibility projects.We have set up an Ecobank Foundation,which is separate from the bank andwhich focuses on five areas: women,children, education, health and culture.But, we’ve gone beyond that. Forexample, we have the largest number ofmicrofinance banks of any bank in Africa,because we feel that financial inclusion isimportant. And we run them commer-cially. So, yes, we take our corporate socialresponsibility very seriously.

OQ: How are you adapting your activities toaddress the vast youth demographic?

AE: We are very focused on addressingthe interests of the youth. The youth rep-resent the future of the continent, butthey have very specific needs. And theyare not really very different from the Wes-tern youth. They have access to mobilephones, Internet, CNN, and their thin-king and expectations are very modern.So we’ve tried to develop products thatrelate to them; things like electronic ban-king and mobile banking.

OQ: How were African markets affected bythe financial crisis? And how did the crisismanifest itself the bank’s business?

AE: Ecobank was relatively unscathed interms of lines of credit still being there forus to do business. We remained reaso-nably profitable even during the worsttimes, and we are beginning to see light atthe end of the tunnel. On a more generalbasis, I think that the financial and eco-nomic crises did slow down growth inAfrica. But that was a temporary situationand Africa is still seen as one of the fastestgrowing regions in the world.

OQ: What does this new partnership withOFID mean to Ecobank?

AE: We’ve been talking to OFID for awhile, looking for avenues of coopera-

Ecobank dates back to the early 1980s, when most of the banks in West Africa

were either state-owned or foreign-owned. It was set up by the Federation of

West African Chambers of Commerce as a regional, privately owned bank, with

shareholders from 14 countries. The first branch opened in Togo in 1988.

Today, Ecobank operates in 30 countries across west, central, eastern and

southern Africa, making it the leading Pan-African bank. It offers a full range of

products and services to governments, financial institutions, multinationals,

medium, small and micro-enterprises and individuals. Ecobank is listed on the

Nigerian Stock Exchange, the Ghana Stock Exchange and the Bourse Regionale

des Valeurs Mobilieres (BRVM) in Abidjan.

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we’re an embedded bank, not a foreignbank, our loans tend to go to the locals,not to the multinationals. Secondly,making more credit available has spillo-ver, multiplier effects in terms of employ-ment, both at our end and within thecompanies we finance. Underpinning itall is the fact that we enable developmentby financing local businesses, which canbe part of the development story of theirrespective countries.

OQ: Do you see scope for a long-term strate-gic partnership with OFID?

AE: Definitely. This is what we discussedin the run up to signing the loan agree-ment. Our position is that we like whatOFID is doing and to the extent that wecan support that in any way, we wouldbe delighted. �

tion. We like to work with developmentinstitutions for two reasons. One, I think,is that they have a long-term commit-ment. They are not like the internationalfinancial markets, where, when things gowrong, the capital dries up. Second,beyond the money, they have the objec-tive of enabling development. And thosetwo principles fit in with our own philo-sophy.

OQ: OFID’s loan will be used to support Eco-bank’s operations in four countries: Came-roon, Côte d’Ivoire, Kenya and Senegal. Howexactly will the funds be used and how willthey impact not just on economic develop-ment but also on human development?

AE: The money will be used to developour business in those markets. Firstly, itwill enable us to make more loans. And, as

Ecobank Foundation: focusing on children, women, education, health and culture.

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FID deemed it opportune, particu-larly following the 2008 financial

crisis, to examine more closely some ofthe important developments in Emerg-ing Markets and their impact on thefuture growth of the global economy. Theone-day Workshop on Emerging Marketsat the OFID Headquarters in Vienna hadthe theme, ‘Investing in Emerging Markets:Risks and Opportunities’ and was speciallydesigned for executive directors andinvestment professionals from leadingdevelopment finance institutions (DFIs)and OFID’s Member Countries. The pur-pose of the workshop was to explore these risks and opportunities, and to dis-cover more about the role of EmergingMarkets in global growth and develop-ment. Additionally, the workshop aimedto encourage delegates to enhance coop-eration and exchange views on seekinginvestment opportunities in EmergingMarkets particularly following the finan-cial crisis.

Mr. Al-Herbish, Director-General ofOFID, stated at the opening of the work-shop that throughout the 35 years ofOFID’s existence, the institution hadmaintained the focus of its assistanceeven during uncertain times, and hadmanaged to scale up its support to its partner countries. “We believe that thissupport is particularly crucial in thesedays of financial constraints and havethus sought continuously to deliver inno-vative financing instruments alongside

OFID holds Emerging Markets Workshop

The growing role ofEmerging Markets inthe global economydrew significant discus-sion at a Workshopheld March 17 at OFID.The Workshop exam-ined crucial develop-ments particularly regarding investmentrisks and opportunitiesin Emerging Markets.Reem Aljarbou coveredthe Workshop for theOFID Quarterly.

sustainability.” The Director-General reit-erated that OFID focuses on strengthen-ing its partnership network with leadingand regional banks, member countryinstitutions, and DFI’s across priority sec-tors to meet new development challenges.He affirmed the importance of the discus-sions at the workshop and their ability toraise awareness and embrace an inclusiveapproach on the synergies of all thoseinvolved in eradicating world poverty.

HE Dr. Hamad Al-Bazai, Vice-Minis-ter of Finance, Saudi Arabia and Chair-man of OFID’s Investment Committeedelivered opening remarks at the work-shop. He highlighted OFID’s drivingcommitment to contribute to the devel-opment priorities of its partner coun-tries: the Emerging and DevelopingEconomies. He stressed that OFID’sfinancial assistance was conceived tosupport investments that promote sus-tainable growth, generate employmentopportunities and build social and eco-nomic infrastructure with the overarch-ing objective of reducing poverty.

“Today, Emerging Markets are highlyinfluential in leading economies and theirgrowth and economic ascendance willbenefit low-income countries,” said Dr.Al-Bazai, who then concluded that whilethe present workshop aimed to explorethe risks and opportunities of investing inEmerging Markets, it would also help todiscover more about their influence inglobal growth and development.

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The workshop began with a keynoteaddress by Xavier Sala-i-Martin, Professorof Development Economics, ColumbiaUniversity. In a presentation, EmergingMarkets – Growth Prospects & Policies,Martin argued that Emerging Markets nolonger existed. He demonstrated howoverall global trends were similar in rela-tion to growth. He gave comparisons ofthe world development economic out-look between 1950-2010. In his analysis,he focused on the growth of China andIndia as an example of the strong histori-cal shift from a dual world to encompassa more global and variant growth wherepoverty and growth are interlinked. Hepredicted that as a result of the growthwithin Africa during the 1990s and its cur-rent acceleration, it would be at the centerof opportunities which would ultimatelyend its many poverty issues.

Professor Martin focused on six keyfactors to defend his theory on thedemise of inequality in opportunities for markets at the global level. He men-tioned convergence, globalization, insti-tutions, macroeconomics and fiscal sus-tainability. He also spoke of the conceptof models and mirrors, highlighting theimportance of following changing mar-ket dominance and learning best prac-tices. His dynamic presentation forecastthat Africa would be a success story espe-cially because of fast moving innovation.He further stressed that countries that weresolely dependent on natural resourcesshould create significant mechanisms toutilize these resources to create otherdevelopmental efforts and spur suchinnovation which can be sustainablewithout these resources.

The workshop then listened to guestspeaker Akbar Ali, Vice President and Senior Portfolio Manager at DimensionalFund Advisors. Mr. Akbar’s presentationfocused on Emerging Market Equity Strategies-Risks & Opportunities in whichhe exhibited in detail the process of build-ing a portfolio of value stocks, anddescribed the unique risks and opportuni-ties, emphasizing the importance of com-pany valuation and stock picking, as �

Xavier Sala-i-Martin is Professor of Development Economics at Colum-bia University and Senior Economic Advisor to the World Economic Forumsince 2002. He is also CEO and Founder of the Umbele Foundation, a non-governmental organization which is committed to poverty reduction inAfrica. Additionally, he is currently a member of the Advisory Board forTelefonica, one of the leading telecommunications companies in Latin Amer-ica and Europe. Sala-i-Martin was a visiting professor of economics at Har-vard University, 2003-2004. He is ranked among the most-cited economistsin the world for works produced in the 1990s. His works include the top-ics of economic growth, development in Africa, monetary economics, so-cial security, health and economics, classical-liberal thinking and conver-gence. He constructed an estimate of the World Distribution of Income,which he has then used to estimate poverty rates and measures of inequal-ity. He has thrice won the Distinguished Teacher in Graduate EconomicsAward, both at Columbia and at Yale University. Also worthy of mentionis the King Juan Carlos I prize, 2004 (a biannual prize given to the besteconomist in Spain and Latin America); and the Lenfest Prize 2006, givento the best teacher at Columbia University. Sala-i-Martin earned his degreefrom the Autonomous University of Barcelona in 1985 and his PhD fromHarvard University in 1990, both in economics.

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sion covered a wide range of issues whichexhibit that Private Sector-Public Sectorcooperation and synergy can stimulategrowth and that DFIs provide environ-mental, social input and a good degree ofcredibility and transparency. Further-more, the panel concluded that emergingmarkets will broaden and deepen over themedium to long-term, resulting in thenarrowing of the gap in market capitaliza-tion of the equity and bond markets withthe developed markets.

At the conclusion of the workshop,Mr. Saeid Niazi, OFID’s Assistant Director-General for Financial Operations high-lighted the many discussions throughoutthe day and reiterated the key issues thatwere covered by the speakers. He stated:“Many of the presentations throughoutthe workshop exhibited the resilience ofcapital markets of emerging economiesand their resilience during the last finan-cial crisis due to the prior implementationof solid structural reforms.” �

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� well as the importance of other factorssuch as local legal system. Akbar con-cluded that there is no correlationbetween GDP growth and long term sta-ble investment returns, describing therisks as unique.

Mr. Michael Gomez, Executive VicePresident, Portfolio Manager and Co-head Emerging Markets Portfolio Man-agement Team, PIMCO, was the next pre-senter. Gomez focused on EmergingMarkets Debt-Risks, Rewards, and Similari-ties & Differences to Developed Markets. Hedemonstrated the asset class as beingrobust compared to developed markets,and highlighted the tripling in size of theasset class in the last five years. Mr.Gomez also pointed out that relative andabsolute valuations are attractive, He con-cluded by stating that emerging marketsreal exchange rates are undervalued andcountries’ Balance sheets are “cleaner.”

The morning session ended with apresentation on the Challenges facing

Emerging Markets. The speaker was JeanPierre Lacombe, Head of Global MarketsStrategy & Financial Engineering at theCorporate Strategy Department at IFC.Lacombe concluded that sound macro-economic policies in the region rein-forced the growth potential and theattractiveness for investors in compari-son to unsustainable policies in the past.

The afternoon session encompasseda panel discussion on the Role of DFIsInvestments in Emerging Markets. The paneldiscussion was moderated by Mr. SaidAissi, OFID’s Assistant Director-Generalfor Operations. Guest panellists includedMr. Michael Barrow, Director, Infrastruc-ture Finance Division 1, in the Private Sec-tor Finance Department at the AsianDevelopment Bank; Mr. Ossama Deeb,former Chief Financial Officer (CFO) ofthe Zain Group; Mr. Jean Pierre Lacombe;and Ms. Valerie Mercer-Blackman, ActingRegional Economic Advisor at the Inter-American Development Bank. The ses-

Participating Institutions at the workshop were from various member-country institutions, other global development finance institutions and other entities; among them, Banco de Desarrollo Económico y Social de Venezuela (BANDES); Bank of Industry and Mine, IR Iran; Bank of Tose’e and Ta’avon, IR Iran; Emirates Industrial Bank; Federal Ministry of Finance, Nigeria; Ministry of Finance, Algeria; Ministry of Finance, Saudi Arabia;African Development Bank; Asian Development Bank; Austrian Development Bank; International Finance Corporation (IFC); International Fund for AgriculturalDevelopment (IFAD); Islamic Development Bank; WKO – Aussenwirtschaft Österreich; Saudi Fund for Development; Social Investment Fund; UNIDO; AsianDevelopment Bank; Columbia University; Dimensional Fund Advisors; Inter-American Development Bank; International Finance Corporation (IFC); PIMCO.

2010

2010 2030

2030

Australia and New Zealand

Japan

Western Europe

North America

Middle East

Latin America

Soviet Union and FSU

Central and Eastern Europe

Developing Asia

Africa

1%

6%

19%

22%

4%

9%

4%

4%

27%

4%

1%

3%

11%

15%

4%

8%

4%

3%

44%

7%

Composition of World GDP

SOURCE: PROFESSOR XAVIER SALA-I-MARTIN, EMW PRESENTATION


OFID hosts Trade Finance Workshop

rade can be an important engine for economic growth and poverty

reduction. Owing largely to rapid expan-sion in some large developing economies,the share of South-South trade in totalworld trade has doubled from 9 percentin 1990 to 18 percent in 2009. Today,almost 40 percent of world trade is con-ducted by developing countries. How-ever, although markets are recoveringfrom the 2008-2009 global economic crisis and the collapse of world trade and trade financing, many traders stillencounter difficulties in accessing tradefinance at affordable cost.

Conscious of the importance oftrade as a key instrument in the fightagainst poverty, OFID hosted a Trade Finance Workshop (TFW) at its Headquar-ters in Vienna, Austria, March 28, 2011.It was the second time OFID was hostingsuch a gathering. Experts and ranking of-ficials from 22 multilateral and regionaldevelopment finance institutions (DFIs),

the World Trade Organization (WTO),export credit and rating agencies, com-mercial banks, and OFID sister institu-tions attended the workshop, whichserved as a platform for sharing experi-ence, expertise, and expectations on issues of common concern.

In his opening statement, OFID Di-rector-General Mr. Suleiman J. Al-Herbishhighlighted the role of OFID’s Trade Finance Facility (TFF) in fostering South-South cooperation, and in ensuring addi-tionality and developmental impact.“Our strategy,” the Director-General said,“is to cooperate with those who share ourviews and aspire to help the poor. Wehave developed strategic partnershipswith institutions that have the knowl-edge of the trade and the local presencewhich we lack.”

Since the onset of the financial cri-sis, OFID has raised the level of resources allocated to the TFF to US$1 billion in aneffort to boost South-South trade and

support the recovery. Activities include awide range of funded and unfunded op-erations, such as direct trade financeloans and guarantees, revolving lines ofcredit, structured trade finance, and risksharing agreements. In addition, severalstrategic partnerships were developed,including the conclusion of risk sharingagreements with the Standard CharteredBank in October 2009, and the StandardBank in March 2010.

Some of the institutions deliveredpresentations on important issues thatrecently emerged in trade finance andthe response provided by DFIs in thepost-crisis era. Items featuring on theagenda of this second TFW included theGroup of Twenty (G-20) and Trade Finance;Basel II and III recommendations; the roleof structured commodity finance in re-sponding to the financial crisis; ware-house financing in emerging markets;commodity price risk, and risk management.Also discussed were the measurement of �

by Fatimah Zwanikken

OFID Director-General Suleiman Al-Herbish (second from right) gave the opening address at the Workshop. He is flanked (right) by Mr. Ahmed M. Al-Ghannam, Director Manager of the Saudi Export Program, who chaired the Meeting; and (left) by Mr. Azzedine Bouchelaghem, SecretariatCoordination Group Meeting and Economist Expert from the Arab Fund for Economic and Social Development and Mr. Said Aissi, OFID AssistantDirector-General, Operations.

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� the development impact of trade financeoperations, and the role of large tradingcompanies.

Through its TFF, OFID regularly co-finances projects with the InternationalIslamic Trade Finance Corporation (ITFC) -a member of the Islamic DevelopmentBank (ISDB) Group. Addressing theWorkshop, ITFC Marketing GeneralManager Mr. Nazeem Noordali explainedthe ITFC’s role in responding to the fi-nancial crisis, using all modes of financ-ing for trade operations that are compat-ible with the principles of Sharia (Islamiclaw), including warehouse financing, i.e.trade finance collateralized by the com-modities financed.

On measuring the development impactof trade finance operations, Mr. RudolfPutz, Head of the EBRD’s Trade Facilita-tion Program (TFP) said: “We have to askourselves, as DFIs, the question what weachieved in terms of supporting the tran-sition from centrally planned to marketeconomies.” He added that trade financewas not an objective in itself. “It has to beassessed by its transition effect as meas-ured by established transition targets.”The EBRD established four clear objec-tives for evaluating the development im-pact of its TFP. These include: (i) foster-ing trade, both intra- and inter-regional; (ii) providing liquidity; (iii) as-sisting participating banks in creating

SPECIAL FEATURE

track records with international banks,and (iv) strengthening trade finance ca-pabilities of local banks.

The workshop presentations servedas a backdrop for discussions on the fea-ture of trade finance, risk mitigation, thesynergies derivable from different pro-grams, and the parameters for develop-ment impact assessment. The workshopprovided participants from the variousinstitutions attending ample opportuni-ties for the sharing of the state-of-the artknowledge, the exchange of views, expe-riences and best practice and in the fieldand an opportunity to network. �

The multilateral and regional institutions present at thisTFW included the World Trade Organization (WTO); theInternational Finance Corporation; the European Bank forReconstruction & Development. Also attending the work-shop were the Eastern and Southern African Trade and Development Bank (PTA Bank) and the Andean Develop-ment Corporation (CAF).

Also participating were representatives of the Secre-tariat of the Coordination Group; some members of theGroup such as the Arab Fund for Economic and Social

Development and the Arab Bank for Economic Develop-ment in Africa. Equally present were the International Islamic Trade Finance Corporation; Dhaman; ICIEC; theSaudi Export Program; ACE - Audit Control & ExpertiseGlobal Ltd; the Austrian Ministry of Finance; Deutsche Bank;BNP Paribas Fortis; Société Générale; Credit Agricole; FitchRatings; the Standard Bank; the Standard Chartered Bank;Swiss Re International SE; JP Morgan Chase; Unicredit; TCX Investment Management Company B.V.; and SumitomoMitsui.

Participating institutions

Mr. Rudolf Putz, Head, EBRD’s Trade Facilitation Program (left) and Mr. Nazeem Noordali, ITFC Marketing General Manager, addressing the workshop.


The meeting was chaired by Mr. Ahmed M. Al-Ghannam, Direc-tor Manager, Saudi Export Program, who highlighted the impor-tance of strong coordination and partnerships among the par-ticipating institutions.

The participating institutions included sister and other organizations such as the Arab Fund for Economic and Social Development; the Arab Bank for Economic Development inAfrica; the International Islamic Trade Finance Corporation; theSaudi Export Program (Saudi Fund for Development); the IslamicCooperation for the Insurance of Investment and Export Credit;and Dhaman.

Speaking of the importance of the meeting, Mr. Al-Ghan-nam said it continued to exemplify the many areas of synergy intrade finance and trade guarantee programs which continue toproduce significant cooperation.

According to Al-Ghannam, the preceding workshop was inline with the issues tabled far the Coordination Meeting. Hestressed the importance of intensive discussions with banks, in-stitutions and programs in widening the horizon of cooperation.He added that hosting institutions of future Coordination Meet-ings should follow this initiative and create a similar workshopfocusing on trade issues with similar institutions. “These discus-sions,” he added, “create a variety of initiatives and different op-portunities at the backdrop of our crucial meeting and are issuescovered continuously within the coordination group.”

Participants reviewed cooperation and coordination amongthe participating institutions and focused on future joint promo-tional activities, operations and pipeline projects. Al-Ghannam

stressed that regardless of the current situation in the Arab re-gion, which had resulted in economic suffering, the positive re-sults in trade were proof that institutions had to continue withtheir work in Public/Private sectors within trade initiatives.

Strategic issues examined at this 5th Coordination Meeting in-cluded synergies, shared objectives and effectiveness; the level ofcooperation and coordination among participating institutions;and the exchange of information on trade finance, risk assess-ments, guarantees, and default operations. Also discussed werejoint activities; networking; the pricing of products and servicesand its mechanisms; technical assistance for institutional capac-ity building and trade promotion, and future operations. Yetother matters encompassed the individual performance reportsof the participating entities (especially what was achieved duringthe preceding year) and a shared vision for future coordinationefforts. It was concluded that a unified development reportingsystem should be established and an automated exchange systemguideline drafted.

At the end of the gathering, participants confirmed the im-portance of an open and rules-based multilateral trading systemfor uniting – rather than dividing – the world. They agreed that,in addition to access to affordable trade finance, enhanced ac-cess to global markets as envisaged in the World Trade Organi-zation’s Doha Development Round of multilateral trade negotia-tions and more aid for trade would be required to help countriesin the South reap the full benefits of trade in the aftermath ofthe global financial crisis. The next meeting will take place inKuwait and will be hosted by Dhaman. �

OFID hosts Coordination Group meetingFollowing the Trade Finance Workshop, OFID hosted a meeting of the Coordination Group of Arab Aid Institu-tions, the Islamic Development Bank and OFID, March 29. The aim was to seek to strengthen cooperation betweennational, Arabic and Islamic Trade Finance and Guarantee Programs. It was the 5th such Coordination Meeting.

Reem Aljarbou attended and reports for OFID Quarterly.

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PHOTO: AFDB

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OFID in the FieldOFID projects and programs aroundthe world remain sources of pride for the institution. The same appliesto the work of OFID with private entrepreneurial efforts worldwide.Across Africa, Asia, Latin America, the Caribbean and the Middle East,the numbers of projects and programsare growing and OFID is pleased tocount itself among the active support-ers of socio-economic advancement in a considerable number of countries.OFID Quarterly presents, in the follow-ing pages, three projects OFID expectswill serve the different countries tothe benefit of their peoples.

31

ygiene, water and sanitation are basicnecessities for good health. In Sierra

Leone, where people have to walk for kilome-ters to fetch drinking water, OFID, in partner-ship with the African Development Bank(AFDB) is working with the government torealize a Three Towns Water Supply & SanitationProject.

The project targets rehabilitation of dam-aged and dilapidated water supply facilities toimprove access to safe water supply servicesin urban and semi-urban areas. Beneficiarycommunities are the residents of Bo, Kenema,and Makeni, which currently have low accessto clean water. The project will seek toimprove sanitation in schools, health centersand other public places such as markets andmotor parks.


Sierra Leone: Water project createsfountain of hope forhealthy living by Tamanna Bhatia

Fetching water in difficult terrain. OFID project is designed to improve access to safe water supply services.

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Sierra Leone experienced a civil war from 1991to 2002. The decade-long war worsenedpoverty across the country. About 80 percentof the population lives in absolute poverty andonly 34 percent have access to safe water andsanitation.

Traditionally, fetching water is considereda task for young girls, who spend their timetrying to obtain water rather than attendingschool or doing something more productive.The shortage of safe water profoundly affectschildren’s chances of survival. Sierra Leone hasa high level of infant mortality (some 283 outof every 1,000 children die before the age offive). Diarrhea, malaria and acute respiratorydiseases pose the greatest danger. There is,thus, a desperate need throughout the countryfor water, sanitation and healthcare services tohelp prevent tragic deaths.

Bo, Kenema and Makeni, with a total pop-ulation of 496,000 (representing 10 percent ofthe population of Sierra Leone) were selectedon the basis of low service as a result of wide-spread destruction of facilities and rapid popu-lation growth during the years of war andthereafter. The choice of the three, which areregional capitals, is also based on their impor-tance as political, economic and cultural cen-ters. Access to safe water supply is available toless than 5 percent of the population in thesetowns. In a comment, Ms. Mona Alessa, OFID’sbackstopping officer for the project disclosedthat the project aimed at improving access tosafe water supply services in these cities fromcurrent levels of less than 5 percent to 50 per-cent by 2015.

Health statistics in the three towns show ahigh incidence of waterborne diseases includ-ing cholera, typhoid and diarrhea, especiallyduring the rainy season. It is expected that theproject will also result in improvements that, in turn, would lead to a decrease in the healthcare cost.

According to Ms. Alessa, cross-cuttingbenefits of the project will include improve-ments in living conditions and public healthin the cities with the associated gender impactsuch as improvement in girls’ education andwomen’s economic activity. Alessa says theproject, when complete, would reduce the

time that women and girls spend in collectingwater. The project will equally promote com-munity involvement in the management ofwater and sanitation and include specificmeasures to enhance women’s participationand voice. It will enable access to pipe-bornewater in the three cities and introduce a Revolv-ing Social Connection Fund that will provideloans for house connections for the poor, whocannot afford the required high connectionfees. Currently, only about 12,000 people inthe three cities have access to pipe-bornewater. The project will bring this to 248,087people by 2015.

Beneficiary communities will also beinvolved in the project either as water kioskoperators or as members of “water-user com-mittees.” Better hygiene and health conditionswill empower and activate the community.Adequate supply of clean water will contributeto the improvement of the country’s economy– reduction of water-borne and other diseaseswill lead to an increase in life expectancy; andhealthier people are in a better position to con-tribute to the economy and the developmentof their country. �


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Sierra Leone, West Africa. OFID’s Three TownsWater Supply andSanitation Projectaims at benefittingBo, Kenema andMakeni.

Jordan: Quality health care for children and young people

The hospital was set up in an area of 27,000 m²with 200 beds and has been contributing signif-icantly to improving health services for chil-dren. Although children up to 14 years consti-tute almost 40 percent of the population inJordan, the proportion of paediatric beds in thepublic hospital was around 20 percent of thetotal number of beds. Rather than increasingthe number of beds within the general tertiaryhospital, it was decided to establish a separateChildren’s Hospital because children have dif-ferent needs than adults and require differentcare, with regard to both nursing care and med-ical treatment.

The hospital aims to meet the current andfuture healthcare needs of children and youngpeople. Its goal is to advance the practice ofpediatric care so that children and families canreceive the best care locally in an environmentthat promotes better healing. “There have beenmore than 14,000 complicated cases; parentsfrom the capital city Amman and other parts ofthe country would have had to go to the US orthe UK or a Gulf state [Saudi Arabia, the UAEand State of Kuwait] in order to get the appro-priate treatment for their children,” explainsMr. Turki Al-Muaikil, the OFID Officer back-stopping the project.

The new Children’s Hospital offers a com-prehensive range of pediatric specialty careservices in a child-focused environment, saysAl-Muaikil. The hospital is equipped to handleeven delicate procedures, such as open heartsurgery and treatment of diseases related to kid-ney, liver, etc., and cancer. Patients with severe


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ecognizing the need for specializedhealthcare for children and young peo-

ple, the King Hussein Medical City (KHMC) inJordan, with funding from OFID and otherorganizations, set up a Children’s Hospital in2009. Within a year of opening its doors, thehospital had catered to the medical needs ofover 10,000 children.

by Tamanna Bhatia

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HM King Abdullah and Queen Rania with a young patient at the Queen Rania Al AbdullahHospital for Children.

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conditions are able to get treatment on time,and waiting time for non-emergency surgicalcases has reduced because a larger number ofbeds and operating theaters are available at thehospital. Early treatment of diseases has helpedin saving costs and reducing human suffering.

The hospital is equipped with state-of the-art equipment and ranks among the top tenworld hospitals. The designing firms, selectedafter international tender, combined localknowledge with profound experience of healthfacility design. That the planning and designwas implemented in collaboration with userrepresentatives further enhanced their abilityto design a well functioning hospital. Since thehospital became fully operational, it has oper-ated on 5,563 patients, handled 80,937 emergen-cies and catered to 106,596 outpatients. Morecases can now receive treatment in the countryitself due to increased capacity and more equip-ment. This has also reduced government expen-diture in the treatment of patients abroad.

All Jordanian nationals and residents withlow income are able to get their children treatedat the hospital as do similarly poor nationals ofYemen, the Sudan, Palestine and Somalia. Sincethe hospital is located adjacent to the existingAl Hussein Hospital and is within the KHMC, ithelps in avoiding duplication of technical serv-ices and ensures that hazardous waste is han-dled with the same appropriate routines asthose from existing facilities in the KHMC.

Being part of the KHMC, the hospital hasaccess to medical research and KHMC’s com-plicated diseases treatment unit. The hospital


and the KHMC management have signed anagreement for cooperation, exchange of infor-mation on treatment of patients, training anddoctors’ skills improvement programs as wellas consultation programs for extremely com-plicated cases with the best hospitals in theUnited States, such as the Mayo Clinic, theHouston Cancer Centre, the Johns HopkinsUniversity Hospital and the Cleveland OhioMedical Centre. The hospital hires specializeddoctors from US, UK, Germany and France totrain local and Jordanian doctors as well astechnical nurses.

Widely acknowledged nationally andinternationally, the Children’s Hospital is com-mitted to providing personalized care topatients. It strives to provide the highest stan-dard of medical and service excellence, patientcare, scientific knowledge and medical educa-tion. Al-Muaikil reports that the expectation isthat the high technical standards combinedwith available skills will attract patients andstudents not only from Jordan but also fromneighboring Middle Eastern countries. The hos-pital will be able to play an important role inmaintaining and promoting child health serv-ices at both national and regional levels. Theability to attract fee-paying patients (maximum20 percent of the beds) can contribute tofinancing the operational costs. If 20 percent ofthe hospital’s beds (i.e., 40 beds) are reserved forprivate patients, the annual revenue of the hos-pital could amount to JOD 1.77 million; andwould thus contribute to the sustainability ofthis world-class healthcare facility. �

PHOTOS: QUEEN RANIA AL ABDULLAH HOSPITAL FOR CHILDREN

From left: Dr. Nadia Hawashma,Head, Complicated diseasestreatment Unit; Col-BrigardierEssa Hazza'a, Director of Planning, Royal Jordanian Military Medical Services; OFID’s Al-Muaikil; Dr. MunaHamidat, Head, Child HealthServices, with the technical staff, Nursing care & medicaltreatment Section

Paraguay:Moving forward and paving the way to greater development

public infrastructure investments have beenmade with a significantly diverse number offinancing institutions.

OFID has had, from the very beginning,an active role in this improvement process aspart of an Initiative for the Integration of RegionalInfrastructure in South America (IIRSA), whichwas launched by and remains supported byregional multilateral development financinginstitutions. The IIRSA initiative has conceptu-ally organized the South American region intointegration and development blocks based onintra-regional and global investment and tradeopportunities, according to productive supplychains. In the IIRSA context, Paraguay has thehighest priority due to its lack of road infra-structure.

Eager for developmentAround 90 percent of all domestic freight traf-fic uses the road system, where poor conditionshinder the smooth transportation of mainlyagricultural products. Paraguay, the 6th largest


araguay is a landlocked country thatshares the third largest groundwater reser-

voir in the world, the Guarani Aquifer, with abelow-surface area of 1.75 million square km,with Brazil, Argentina and Uruguay. Despite awell-developed network of rivers, consisting ofthe Paraguay and the Parana with a navigablelength of approximately 6,200 kilometers,Paraguay needs to develop a network of roadsfor the transport of goods, mainly agriculturalproducts, one of the country’s principal exports.

Paraguay’s road network requires develop-ment, when compared with its partner coun-tries in Mercosur. Few paved roads connect themain production and population centers.Paraguay has an officially inventoried road net-work of 32,059 km of which only 4,860 km arepaved. Current infrastructure efforts averageonly 100 km of newly paved roads per year.

As a member of Mercosur, it is imperativeto increase Paraguay’s regional competitivenessby improving access to neighboring countriesand international markets. In recent years,

by Damelys Delgado

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producer of soybeans globally, is the 4th largestexporter of soybeans, just behind Brazil, theUnited States and Argentina. In the last 10years, soybean exports have exceeded exportsof cotton and meat.

So far, OFID has participated in two proj-ects related to the road network. The first, called“Road Rehabilitation Project,” supported byOFID in partnership with CAF and the govern-ment of Paraguay, increased access to interna-tional markets and reduced vehicle, road oper-ation and transportation costs. Concurrently,improvement in road transport conditions hasreduced travel time and provided a safe alterna-tive route for trade between Paraguay andBrazil. On the other hand, OFID’s partnershipwith CAF has grown significantly since bothorganizations started working together inParaguay in 2004, and has been strengthenedwith the enhanced Cooperation Agreementsigned in June 2010.

Mr. Romulo Martinez, the Officer incharge of Paraguayan projects and programs atOFID, commented that the road rehabilitationproject would be of direct benefit to 85,000people, particularly rural populations and theinhabitants of the Departments of San Pedro,Caaguazu and Amambuay. Martinez said theproject was “a successful milestone in efforts toimprove the country’s road sector.” The projectwas designed to improve 23.5 km between Yasy Kany-Capiibary towns and 58.7 kmbetween Nueva Germania-San Pedro towns.OFID financed US$12 million, equivalent to46.5 percent of the total cost, which was esti-mated at US$26 million. The rest of the fundingcame from CAF and the Government ofParaguay. These areas are among the poorest interms of unmet basic needs, with an estimatedpopulation of one million, although the regioncontributes almost 100 percent of the nationalproduction of soybeans and maize.

More roads to strengthen the economy Says OFID’s Martinez: “With the positive per-formance of Paraguay, OFID is currently fundinga second project called the National Rural RoadsProgram.” This program is funded through aUS$50 million loan from the Japan InternationalCooperation Agency, a US$65.5 million loanfrom IDB, a US$29 million loan from OFID and

a US$25.4 million loan from the Paraguayangovernment. OFID’s support is equivalent to17.1 percent of the total cost, estimated to beUS$170 million.

This project will improve approximately1,150 km of roads and involve 4 km of bridges.According to Efraín Alegre, Public Works Min-ister, the project will aim to improve roads inthe most critical zones and replace some 200wooden bridges with reinforced concretestructures’.

For Javier Recalde, Head of Unit CAF-OFIDProjects, from the Public Works Ministry ofParaguay, “OFID’s support has been positive,as demonstrated by the efficiency in the administration of resources and also by theadjustments made to the project in a fast andeasy-going way”. OFID made the project dis-bursements in just about a year.

The social impact of the project will bene-fit up to 70,000 families or more than 350,000people, in 10 departments of the eastern region:Concepción, Cordillera, Guairá, Itapúa,Misiones, Paraguarí, Alto Paraná, Ñeembucú,Amambay and Canindeyú. International tradein, and local sales of soybeans, maize and othercereals are enhanced by shortening travel timebetween the production and the export areas.

Paraguay is clearly moving forward andOFID is helping to pave the way to greaterdevelopment. �


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It is imperative to increase Paraguay’s regional competitivenessby improving access toneighboring countriesand international markets.

Mr. Javier Recalde, Head of Unit CAF-OFID’s Projects, from the Public Works Ministry of Paraguay (left) and Mr. Romulo Martinez, the OFID Officer in charge of projects andprograms in Paraguay.


OFID’s 35th Anniversary commemoration begins

tional Organizations in Austria, openedthe Saudi Exhibition, Look Beyond. Theworks on display were by Noha Al-Sharif,Manal Al-Dowayan and Seddiq Wassil; allthree of them leading Saudi artists. Theexhibition was also in continuation of anOFID in-house exhibition series begun in2009 and aimed at bringing the art andculture of member and cooperating coun-tries to the community of OFID host cityVienna. In the past, OFID has held suchexhibitions focusing on Venezuela, Alge-ria, Sudan, Iraq and Kenya. The next in-house, Anniversary-related exhibitionwill feature artwork from Indonesia (seeseparate article, page 53).

Prince Mansour, addressing theguests, commended the active role and wise management of OFID by theDirector-General. The Prince also praisedthe staff of the institution and their dedi-cation toward accomplishing the noblegoals set in OFID’s mandate to assist andpositively contribute to fulfilling thesocial and economic needs of many partsof the developing world.

anniversary an opportunity to reaffirmthe organization’s mission and vision andto revitalize efforts against poverty andobstacles to development.

The number of cooperating coun-tries working with OFID has grown to animpressive 129, spread across Africa, Asia,Latin America, the Caribbean, the Mid-dle East and parts of Europe. Thus far, Mr.Al-Herbish related, OFID had committedmore than US$13 billion in support of sus-tainable development, building infra-structure and utilities. Many roads,bridges, schools and hospitals countamong these, in addition to technicalassistance and funding for research andstudies. Over the past few years, OFID hasseen the various financing windowsthrough which it does its work grow tocover private and public sector interven-tions; trade financing; and grants.

Saudi ExhibitionHH Prince Mansour bin Khalid al Saud,Ambassador of the Kingdom of Saudi Ara-bia and Representative to the Interna-

he 35th Anniversary commemora-tion of OFID took off to an auspi-

cious start January 27 with a receptionhosted by Director-General Suleiman J.Al-Herbish and the formal opening of anAnniversary Exhibition by MemberCountry Saudi Arabia. In attendance wereranking representatives of governments,members of the diplomatic corps, inter-national institutions and the businesscommunity as well as art experts.

The distinguished gathering heardabout the aims and accomplishments ofOFID and the institution’s expectationsthrough the years ahead. The Director-General spoke of an institution which,with the unwavering support of its Mem-ber States, has sought to make a differ-ence in the lives and times of low-incomecountries and poor peoples around theworld. Mr. Al-Herbish said OFID and part-ner institutions, including the bilateraldevelopment finance agencies of Mem-ber Countries, were united againstpoverty and doing what they could toease hardships, worldwide. He called the

Director-General Al-Herbish with the two artists, Mr. Seddiq Wassil (left) and Ms. Manal Al-Dowayan (middle).

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Anniversary programOFID’s 35th Anniversary, to be observedthrough 2011, has thus far also featuredneon signs outside the OFID building.Still forthcoming will be publication oftwo books – one on the building andanother, a Children’s book. There will beparticipation in the Vienna City Marathon,2011; the construction of special towersand poster designs decorating the atriumof the OFID building; a revamped web-site; and the production of a new video onOFID’s achievements and challenges. �

Policies and Planning Group, explainedthe importance of recognition for thecontributions of staff. Mr. Al-Herbishcalled on OFID staff to do more to battlepoverty, as the world increasingly unitedagainst poverty. “Think of synergies,” headvised, and “let us have genuine collab-oration.” Mr. Al-Herbish is a proponent ofteam work. He said there was a lot ofuntapped talent and ideas among thestaff, and this should be encouraged anddeveloped.

Staff AwardsLater in February, OFID management andstaff assembled to honor colleagues whohad given five and more years of service tothe institution and whose contributionswere described as exemplary. It was thefirst in planned, regular service award cer-emonies and a highlight of the Anniver-sary celebration. “New-comers” (thosewith less than five years of service) werealso commended at the ceremony.

Opening the event, Mr. AbdulwahabAl Abbas, Head of OFID’s Human Resources

HH Prince Mansour bin Khalid al Saud. Ms. Manal Al-Dowayan presenting one of her works.

Honored OFID staff assembled for a group photograph


January – March 2011

JANUARY 13

Public sector loan agreement signed

Benin. US$11million. Kandi-Segbana-Nigeria BorderRoad. To upgrade a 118 km-longearth road that links the town ofKandi to the Nigerian border viathe village of Segbana, thus facil-itating the transport of inputsand agricultural goods and im-proving the population’s accessto social services.

JANUARY 21

Public sector loan agreement signed

Burundi. US$8 million. Ntamba-Ndora Road. To con-struct a 14.5 km-long pavedstretch of road passing throughthe Bubanza and CibitoleProvinces in the northwest, thusboosting access to basic servicesand helping end isolation.

JANUARY 27

OFID launches 35th Anniversary celebration

OFID began its 35th Anniversarycelebrations with an in-housemember country series exhibi-tion Look Beyond, which show-cased works of Saudi Arabianartists.Read more page 48

FEBRUARY 8

HRH Princess Dina Mired of Jordan visits OFID

Mr. Suleiman J. Al-Herbish, OFID Director-General, welcomedHRH Princess Dina Mired of

Jordan, Director-General of theKing Hussein Cancer Founda-tion. HRH and her delegationwere at OFID to give a presenta-tion about the King HusseinCancer Center and its recently-built Interventional RadiologySuite. OFID helped finance theconstruction with a US$600,000grant.

FEBRUARY 23

Public sector loan agreements signed

Bosnia and Herzegovina. US$7 million. Housing Recon-struction. To co-finance the reconstruction of approximately700 housing units, thereby pro-viding accommodation foraround 3,000 people and aidingtheir reintegration in their homecommunities.

Burkina Faso. US$7.2 million.Ziniaré Regional Health Center.To provide the population withaccess to specialized, high-qual-ity healthcare services throughthe construction of a fully-equipped, 249-bed health center.

Cambodia. US$12 million.Water Resources ManagementSector Development. To improveand rehabilitate 15,000 ha of irrigation infrastructure in threeprovinces, and in turn, raise agricultural productivity.

China. US$18 million. Bayin River Management. Toprevent the frequent floodingthat occurs in Delingha City,which places the lives of the71,000-strong population at riskand destroys vital infrastructure.

Cuba. US$12 million. Havana Electricity Rehabilitation.To improve energy efficiency,

reduce energy losses and providecost-effective delivery of electric-ity in the capital, Havana, particularly among the pooresthouseholds.

Ethiopia. US$20 million. Energy Access. To enhanceEthiopia’s socioeconomic growthby expanding the country’s national grid and providing electricity to some 70,000 ruralhouseholds.

The Gambia. US$5 million. University of The Gambia. Tobolster the higher education sector through the expansionand upgrading of the universityto accommodate around 3,000additional students.

Niger. US$10 million. Bella IIGaya Border with Benin Road Rehabilitation. To improve thetransportation sector throughthe rehabilitation of 73.4 km of road and installation ofdrainage works.

Niger. US$8.36 million. Emergency Food Security andRural Development Program. Tocarry out a wide range of activi-ties aimed at improving food security among poor farmers andherders heavily affected by recur-rent food and livestock crises.

Sierra Leone. US$19 million.Water Supply and Sanitation. Toincrease accessibility to safe waterand improve sanitation in schools,health centers and other publicplace in three selected towns.

MARCH 4

Emergency assistance grantapproved

World Food Program.US$500,000. To respond to aglobal appeal to provide food

and assistance to some 2.7 mil-lion people leaving the SocialistPeople’s Libyan Arab Jamahiriyain light of the crisis there.

MARCH 16

134th Session of the Governing Board

Public sector project loans approved

Armenia. US$20 million. Rural Assets Creation Program.To help finance construction orrehabilitation of public utilities aspart of a wider-scale project aimedat improving incomes and rais-ing living standards among poor,small-scale farmers in Armenia.

Burundi. US$8 million. Bujumbura-Nyamitanga Road.To help promote socio-economicdevelopment in northwest Burundi through the construc-tion of a road that will facilitatethe movement of agriculturalgoods and people residing insome of the poorest provinces in the region.

El Salvador. US$15 million.Rural Territorial CompetitivenessProgram. To help reduce ruralpoverty in eastern El-Salvadorthrough the implementation ofschemes aimed at improving in-comes, boosting food securityand implementing market-diver-sification schemes, benefitingover 225,000 people.

Lao PDR. US$12 million. Second Northern Greater MekongSub-region Transport NetworkImprovement. To rehabilitateand upgrade around 143 km ofroads in the Houaphanh Provincein the northeast, which will improve access to social services


OFID DIARY

Meetings attended by OFID

JANUARY 8-9

BEIRUT, LEBANONAnnual Meeting of the ArabEnergy Club

JANUARY 18-19

SHARM EL-SHEIKH, EGYPT2nd Arab Economic, Social and Development Summit

JANUARY 20

VIENNA, AUSTRIAGoldman Sachs Key themeconference “Economic andInvestment Outlook for 2011”

JANUARY 23-24

TEHERAN, IR IRANRegional Forum on GrainTrade organized by the Governmental Trading Corporation of Iran

JANUARY 31 – FEBRUARY 3

AUSTIN, TEXAS, USAAnnual Investment Symposium organized byDimension Fund Advisors(DFA)

FEBRUARY 16-18

BRUSSELS, BELGIUMArab-African Crans MontanaForum on Energy

MARCH 1-2

RIYADH, SAUDI ARABIAAnnual Saudi EconomicForum 2011

MARCH 7-8

VIENNA, AUSTRIAUN International Meetingon the Question of Palestineunder the theme

“The urgency of addressing the plight of Palestinianpolitical prisoners in Israeli prisons and deten-tion facilities”.

MARCH 9

VIENNA, AUSTRIA4th Vienna Energy ClubMeeting

MARCH 13-17

KUWAIT CITY, KUWAITSymposium on “Food and Water Security in theArab World” organized by the Arab Fund for Economic and SocialDevelopment

www.ofid.org

and marketplaces for some60,000 people residing in theproject area.

Mali. US$10 million. MarkalaSugar. To expand Mali’s sugarproduction capacity to enablethe export of excess sugar toneighboring countries and raiseincomes of independent sugar-cane farmers, benefiting some156,000 individuals.

Technical assistance grantsapproved

International Atomic EnergyAgency. US$450,000. AdvancingCancer Control in Vietnam. Tosupport a project that will covertwo priority areas; namely, im-proving screening programs forbreast and cervical cancer andbuilding national radiotherapycapacity for cancer treatment.

United Nations InternationalChildren’s Emergency Fund(UNICEF). US$300,000. To support a School Water Sani-tation and Hygiene program in Tanzania. Activities relating to improved health and hygienepractices will take place in 57 schools, benefiting some40,000 children.

Grant approved under theHIV/AIDS Special Account

International Partnership forMicrobicides (IPM). US$1.5 mil-lion. Advancing Microbicide Development Project. To supportIPM in developing microbial gels that can prevent HIV trans-mission. Activities will be carriedout in Kenya, Malawi, Rwanda,South Africa and Zimbabwe.

Grant approved under theSpecial Grant Account forPalestine

Assistance to Civil Society Organization in Palestine –Phase III. US$1.5 million. Tohelp finance the third phase of aprogram that is providing assis-tance to 20 Palestinian civil soci-ety organizations that are carry-ing out activities in the areas ofagriculture, community develop-ment, education and health.

Research grants approved

Food and Agricultural Organi-zation of the United Nations.US$100,000. To support a small-scale, livelihood-oriented bio-energy pilot project that aims atpromoting sustainable naturalenergy resource development torural communities in Laos,Cambodia, Mali, Nepal, Peruand Senegal.

Optimist Organization.US$80,000. To help finance theestablishment of an Orphan Residential Care center in Delhi,India, to house children betweenthe ages of four – 16 in a secure,caring environment.

G-77. US$40,000. To supportthe First General Conference of the Consortium for Science,Technology and Innovation for the South.

MARCH 17

OFID hosts Emerging Markets Workshop

OFID hosted a one-day Work-shop focusing on Emerging Markets, which held under thetheme Investing in EmergingMarkets – Risks and Opportuni-ties. See story on page 24.

MARCH 18

Private sector loan agreement signed

Ecobank Group. US$30 million.This loan will be used tostrengthen Ecobank’s capital in four countries (Cameroon,Côte d’Ivoire, Kenya and Senegal), where it is playing avital role in the local markets.

MARCH 25

Public sector loan agreement signedParaguay. US$19 million. To support an urban redevelop-ment and modernization projectin the capital Asunción. The majority of OFID’s loan will bedirected to the establishment ofa Bus Rapid Transit System be-tween the city centers of SanLorenzo and Asunción.

MARCH 28 – 29

OFID hosts Trade FinanceWorkshop and Arab Coor-dination Group MeetingOFID hosted a one-day Trade Finance Workshop at its head-quarters in Vienna, Austria.See story page 27

OFID DIARY


HE Danladi Kifasi, Nigerian Governor to OFID (left) and Mr. Muniru Abiodun Alao, AlternateGovernor.

From left: Mr. Said Aissi,Assistant Director-General,Operations; Mr. Suleiman J. Al-Herbish, Director-General; Mr. Jamal NasserLootah, Governing BoardChairman; Mr. Saeid Niazi,Assistant Director-General,Financial Operations.


OFID DIARY

134th Session of the Governing Board

At its 134th Session in Vienna, the OFID Governing Board approved US$65 million in new financing for projects in Armenia, Burundi, El Salvador, Laosand Mali. The five public sector loans will support primarily initiatives in the agriculture and rural developmentsector, with the aim of boosting incomesand food security among small-scalefarming communities. Road constructionalso featured. Other approvals at themeeting included four grants totallingUS$3.75 million.

HE Alí De Jesús Uzcategui Duque, Alternate Governor Ad Hoc(right) and Mr. Carlos Lopez Herrera, Specialist in DevelopmentBanking, BANDES.

HE Dr. Fadhil Nabee Othman, Governor of Iraq to OFID.

Mr. Abdul Wahab Ahmed Al-Bader, Governor of Kuwait to OFID (left) and Mr. Fawzi Yousef Al-Hunaif, AlternateGovernor.

LOAN SIGNATURE

OFID DIARY


January 21HE Saidi Kibeya, Minister of Transport, Public Works and Equipment of the Republic of Burundi secured a US$8 million loan for a priority road project, which he said would help his country develop its rural areas and further improve its economy.

February 23HE Norma Miguelina Goicochea Estenoz, Ambassador of Cuba to Austria, signs the US$12 million agreementfor the third phase of an electricity rehabilitation project in the capital Havana.

February 23HE Shi Mingde, Ambassador ofthe People’s Republic of Chinato Austria, and OFID Director-General Al-Herbish initial theUS$18 million loan agreementfor a water management projectalong the Bayin River.

The full list of loan signatures can be found on pages 40-41.

OFID DIARY


February 23HE Mambury Njie, Minister of Finance and Economic Affairs of The Gambia, signs the US$5 million agreementfor a project that would take his country to “the next frontier” in terms of being able to offer its youth the possibility of university education.

February 23HE Sufian Ahmed, Minister of Finance and Economic Development of Ethiopia received a US$20 million loan to help expand the country’s national grid and deliver electricity to 70,000 ruralhouseholds.

February 23HE Dragan Vrankic, Minister of Finance and Treasury ofBosnia and Herzegovina, shakeshands with Mr. Al-Herbish following signature of the US$7 million loan agreementfor a housing reconstructionproject in the Brcko District. At the rear is Mr. Dragan Pajic;Mayor of Brcko District.


OFID DIARY

January 25HE Mr. Abdulhakin Al-Eryani,

Ambassador of Yemen.

February 8HRH Princess Dina Mired,

Director-General of Jordan’s King Hussein Cancer Foundation.

January 31HE I Gusti Agung Wesaka PUJA, Ambassador of Indonesia.


OFID DIARY

February 25OFID Director-General,Mr. Al-Herbish (left) greetsHE Dr. Diala Alhaj Arif,Minister of Social Affairsand Labour of Syria.

February 25HE Dr. Uche Amazigo, APOC Director (right) andProf. Donald Bundy from the Human Development Network of the World Bank.They met with OFID officialsto review APOC progress and donor financing.



DAVOS 2011 addresses water, energy and food securityPublic-Private partnerships for a sustainable future

ver 2,500 leaders from business, civilsociety and government – including

over 35 heads of state or government – gath-ered in Davos, Switzerland on January 26-30,2011 for the 41st World Economic Forum (WEF)Annual Meeting. Organized under the themeShared Norms for the New Reality, the five-daymeeting focused on defining shared normsrequired for improving global cooperation anddialogue to address the complex and inter-twined challenges of our time. “The shifts ofpolitical and economic power from West toEast and from North to South, as well as thespeed of technological innovation, have cre-ated a completely new reality. Global systems

and decision models can no longer cope with the speed and complexity of all thesechanges,” said Klaus Schwab, WEF Founderand Executive Chairman.

The Forum’s Global Risks 2011 Reportwarns that “any strategy that focuses on onepart of the water-food-energy nexus withoutconsidering its interconnections risks seriousunintended consequences.” The analysis showshow food, water and energy security are linkedto other factors such as population growth,environmental pressures, economic disparitiesand global governance. These interrelatedissues impact global economic growth, andcould lead to geopolitical conflict.

by Fatimah Zwanikken O

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In a panel discussion at Davos, more than 100world leaders from the public and private sec-tors and civil society discussed how theycould better work together to tackle the inter-related challenge associated with the tight-ening of water, food and energy resources.Among the participants addressing the Forumwere Mexican President Felipe Calderón;United Nations (UN) Secretary-General BanKi-moon; HE Mr. Susilo Bambang Yudhoy-ono, President of OFID Member CountryIndonesia; South African President HE Mr.Jacob Zuma, and Mr. Bill Gates of the Bill &Melinda Gates Foundation.

“Developing new sources of renewableenergy is an amazing business opportunity andkey to achieving sustainable economicgrowth,” said Mexican President FelipeCalderón. However, energy efficiency and theappropriate use of new technologies may yieldrewards that exceed the benefits of renewableenergy sources such as biofuels. As industrial-ized nations try to reduce their dependency onfossil fuels, their efforts to move towards biofu-els resulted in increased demand on scare waterand land resources amid rising problems offood security.

The UN Food and Agriculture Organiza-tion (FAO) recently reported that global foodprices hit a record high. In February 2011, theFAO Food Price Index (FFPI) – a measure of themonthly change in international prices of abasket of food commodities – reached its high-est level (both in real and nominal terms) sinceJanuary 1990, the inception date of the index.With poverty and food prices among the keydrivers of political unrest, the issue of foodsecurity continues to pose serious challengesfor both developed and developing nations.

Problems of food security are com-pounded by climate change. UN Secretary-General Mr. Ban Ki-moon called for fast anddecisive action on climate change. This, hesaid, requires revolutionary change in the waypeople live, the way they organize socially andthe way politics are conducted. “We need a freemarket revolution for global sustainability,”he said. “The days of consumption withoutthought are over. Climate change is renderingthe old model obsolete. The old economicmodel now amounts to a global suicide pact,”he added.



Professor Klaus Schwab,Founder and ExecutiveChairman of the WorldEconomic Forum.

South African President JacobZuma vowed to press for agreater corporate role in theUN climate talks that hiscountry will host in Durbanlater this year. “I think that’s one of the areas we aregoing to work very hard lead-ing to Durban to convincebusiness to be party so that it’snot just governments alone,”Mr. Zuma said. Sharing thefloor with Mr. Zuma, HE Mr. Susilo Bambang Yudhoyono,President of Indonesia de-clared that his governmentwas committed to policiesthat balanced growth andenvironmental protection.There is serious concernabout how to keep the global economy moving forward while, at the same time,ensuring that people in the developing worldare not denied a chance to better their liveswithout contributing to factors that havecaused global warming. “We should not makea contradiction between growth and the needto protect the environment,” Mr. Yudhoyonostated.

Mr. Bill Gates said he was optimistic thathumankind’s ability to innovate would eventu-ally produce solutions. Just demanding thatdeveloping countries cut energy use would notresolve the problem. “You cannot tell a guy inIndia who is using two candles that he can onlyuse one,” he said.

The Forum concluded that diminishingnatural resources and climate change calledfor business and governments to work togetherin new ways. The WEF identified a number ofsteps that could be taken to address the water-food-energy-climate change nexus. Businessesmust get more involved in global efforts toslow climate change and enact policies thatpromote green growth. To help global leadersbetter understand, manage and respond torisk, the WEF launched a Risk Response Net-work. The network will address a wide range of interrelated risks ranging from financialgovernance to cyber-security and resourcescarcity through an umbrella of projects andinitiatives. �

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MEMBER STATES FOCUS

Free Independent Kuwaitby Suad Al-Mojil

PHOTO: SHUTTERSTOCK/MESHAL ALAWADHI


MEMBER STATES FOCUS

henever the anniversary of inde-pendence approaches, Kuwaitis

cherish and remember their ruler Abdul-lah Al-Salem, whose wisdom in establish-ing democracy in Kuwait has alwaysacted as a solid wall that protects Kuwaitfrom drastic political upheaval.

Historically, Kuwait was famous forthe walls that were erected by its peopleto protect the small city from invaders.Three walls marked that method of de-fense, and Kuwaitis added to them afourth wall; namely the committee ofsenior Kuwaiti figures appointed by thelate Sheikh Abdulla Al-Salem.

To go even further back in the his-tory of the Kuwaiti democracy and con-stitution, we could say that on the inter-nal scene, Kuwait witnessed advances re-lated to both the rule and the local ad-ministration.

In 1921, the state consultative coun-cil was formed by appointment, but inJune 1938, Kuwait witnessed the electionof the first legislative council. This wasfollowed by an increase in the intellec-tual and cultural movements that wouldflourish in Kuwait, and in the number ofliterate people and schools.

By the 1950s, Kuwait was heading toindependence. National and politicalawareness was at its peak, and the activi-ties of Kuwaitis were increasing tremen-dously in volume and nature. At thattime, the ruler of Kuwait, Sheikh AbdullaAl-Salem who had been the chairman ofthe first parliament of Kuwait in 1938,welcomed constructive criticism and waskeen to achieve fully considered steps toindependence and constitutional gov-ernment. Abdullah Al-Salem and theKuwaiti people could no longer acceptthe restrictions imposed by the protec-torate agreement of the British, who lateraccepted the Kuwaiti demand. Diplo-matic notes were exchanged between SirWilliam Luce, the British Political Resi-dent in the Arabian Gulf at that time, andSheikh Abdulla Al-Salem, on June 19,1961. According to the agreement, theterms of Kuwaiti independence were car-ried out, and a few months after inde-

pendence, the ruler of Kuwait gave in-structions for the formation of a popularcommittee to draft a modern constitu-tion for independent Kuwait. Accordingto this constitution, the national assem-bly has absolute power to draw up thelegislative policies and control over theexecutive authority.

Matters continued as planned andscheduled, though the day for celebrat-ing this achievement was shifted to Feb-ruary 25, a month that would, thirtyyears later, mark another pillar in Kuwait

history, when the liberation of Kuwaittook place on February 26, 1991.

Nowadays, celebrations carry onthroughout February which stands as in-dependence and liberation month, or asKuwaitis now call it Hala February, whichmeans Welcome February.

This is a brief introduction to thefourth wall or the constitution thatopened up the horizon for a new inde-pendent Kuwait, and later on for a freeliberated Kuwait. �

W

Releasing white doves, in Salmiya February 24, to symbolize a message of peace to the countryand the world. Deputy Minister of the Amiri Court Sheikh Ali Jarrah Al Sabah is on the right.

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Kuwait gained political independence from Britain in June, 1961.In May 1964, a decision was made to celebrate Kuwait’s NationalDay on February 25th each year in honour of the late Emir SheikhAbdallah Al-Salim Al-Sabah, whose rule had begun the same dayin the year 1950.

The Head of the Committee organizing this year’s celebra-tions was Sheikha Amthal Al-Ahmad Al-Sabah. She told Kuwaitisthat the event provided an opportunity for the people to boostsocial bonds and promote national unity. She said: „We are cel-ebrating great accomplishments through which our small home-land proved mighty and way beyond its geographical limit ofspace…and …[provided] an example for the world on manyfronts and in many fields.“ The government declared two days ofholiday and extended an emiri grant of 1,000 Kuwaiti Dinar toevery citizen.

Several heads of state and senior government officials fromvarious parts of the world visited to join in the celebration.According to news agency reports, they witnessed an impressiveparade that included acrobatics by fighter planes flying in forma-tions. Along with Kuwaiti ground and air forces, there was partic-ipation by friendly forces drawn from, among others, Saudi Ara-bia and Syria.

The festive mood in Kuwait was felt way beyond the nation,among friends and well-wishers. Addressing a CommonwealthCouncil of the British House of Commons, the Kuwaiti Ambas-sador to the United Kingdom and Dean of the diplomatic corpsin the UK, HE Mr. Khaled Al-Duwaisan asserted that there wereno differences between the leadership and the people in Kuwait.He said the government offers free education at all levels; pro-

vides free health care; and runs housing funds to give cheap,interest-free loans. Work opportunities were also abundant.

In the area of development cooperation, Kuwait stands outamong major donors of the world. Kuwait established its ownbilateral development finance institution – the Kuwait Fund –back in 1971 and was instrumental in the founding of severalmultilateral and inter-governmental aid institutions, includingOFID. A study published recently by the World Bank revealedthat Arab states are among the most generous regarding dona-tions to global development. The Bank recognized Kuwait as thesecond most generous in the region, next to the Kingdom ofSaudi Arabia. Among the numerous international organizationsthat have paid glowing tribute to Kuwait on the occasion of itsAnniversary have been the Organization of Arab PetroleumExporting Countries (OAPEC) and IFAD, the International Fundfor Agricultural Development. OAPEC Secretary-General HE Mr.Abbas Ali Naqi extolled the role of Kuwait in OAPEC sayingKuwait was playing a leading role in supporting joint Arab workat all levels. Kuwait is one of only three countries which estab-lished OAPEC in 1968.

Also in February, a Kuwait Hall was opened at IFAD head-quarters in Rome. HE Ambassador Sheikh Jaber Al-Duaij Al-Ibrahim Al-Sabah joined IFAD President Dr. Kanayo Nwanze inopening the Hall. Reporting, KUNA, the Kuwait News Agency (19February, 2011), said the opening highlighted Kuwait’s pioneer-ing role at IFAD and Kuwait’s international efforts at combatingpoverty and hunger. Earlier, Kuwait had pledged that the coun-try intends to increase its share to IFAD by 50 percent to moreeffectively fight poverty and hunger in the world. �

Kuwait marks 50th Anniversary Kuwait marked, in February, its 50th Anniversary as an independent State. It certainly was a celebrationwidely observed across the country and elsewhere.


MEMBER STATES FOCUS


n 2009, OFID initiated an in-houseexhibition series aimed at bringing

the art and culture of its Member Coun-tries and Partner Countries to the com-munity of its host city Vienna. In the past,OFID has held exhibitions focusing onAlgeria, Iraq, Kenya, Saudi Arabia, theSudan and Venezuela.

OFID is next showcasing the art ofIndonesia and welcoming multi-talentedBalinese artist Made Wianta, whose artworks reflect the power of nature andits fundamental elements: water, earth,wind, fire and ether (space).

Titled “Transformation of Nature,”the exhibition will be inaugurated with acultural evening including traditionalcuisine, music and a dance performancefrom Indonesia. The exhibition will bejointly organized with the Embassy of theRepublic of Indonesia in Austria and willrun from May 26th until June 10th 2011.

Twenty-five paintings will be on dis-play, showing the beauty of nature thatWianta perceives as the “alphabet” forcreation. For Wianta, nature is the lifesource of all fine art, providing the basicmaterial with which artists create. In his

life, Wianta has taken up the challengeto perceive visible nature as a “usefullyput together system” and to seize the“invisible working powers” with all hissenses in order to transform them intoart. In the solid of the earth, the liquid ofthe water, the breeze of the wind, the fireand the sound of space, the artist findsinspiration and the qualities of matterwith which he works and forms into anew reality: Art.

With his works, Wianta is also aim-ing at raising awareness and responsibil-ity for the global environment. His strongsense of environmental awareness andsocial responsibility also prompted himto hold several exhibitions, donating hispaintings for sale in support of varioussocial causes.

Contemporary artist Made Wiantawas born in 1949 in the village of Apuanin the remote highlands of TabananRegency in Bali, Indonesia. He studied atthe Indonesian School of Fine Art in Den-pasar, and at the Indonesian Academy ofFine Arts in Yogyakarta central Java,where he received his diploma in 1980.In decades of an artistic career, he has

articulated himself in many differentstyles and art forms including paintings,installations and poems. He has createdmore than 14,000 pieces of artwork andhas exhibited nationally as well as inter-nationally at prestigious galleries andmuseums. Among the countries where hehas exhibited his works or participated ingroup art shows have been Bangladesh,Belgium, France, Germany, Italy, Japan,Malaysia, the Netherlands, Russia, Singa-pore and the United States of America. �

Indonesia prepares for Art Exhibition at OFID

by Silvia Mateyka

I

Multi-talented Balinese artist, Made Wianta.

PHOTOS: COURTESY MR. MADE WIANTA


OPEC

PEC Member Qatar, which success-fully hosted the Asian Cup soccer

tournament in January this year, is on theroad to the World Cup – and even thoughit is not for another 11 years, the people ofQatar already cannot wait. What beganwith government determination todevelop Qatar’s international standing,particularly with regard to the promotionof sports of all kinds, has resulted in suc-cess that few could have envisioned.

The fact is that when the Gulf stateof Qatar figured in the ‘final four’ show-down in Zurich as to who would host theworld’s premier soccer competition in2022, few gave Qatar any chance. Thecompetition had been against the UnitedStates, Japan, South Korea and Australia.Many felt Qatar had done amazingly welljust to get as far as it did in the final selec-tion process, but most harbored thethought it was just making up the num-bers in the final run in.

When FIFA President, Sepp Blatter,pulled the name of Qatar out of the win-ning envelope in Zurich there were theunderstandable looks of surprise, but alsogasps of sheer delight. The surprise, that ithad beaten its heavyweight adversaries,but delight that such a small country withseemingly fewer credentials could beentrusted to stage such a prestigiousevent.

“Guts, gumption and glory” is howthe local media termed it, stating that

Qatar’s win in the bidding process to hostthe tournament had never been in doubtand was justly deserved. It was also inkeeping with FIFA’s aim of broadeningthe horizons and ultimate reach of inter-national football – and people in the Mid-dle East are great football enthusiasts.

Whichever way one looks at it, thedecision speaks volumes about Qatar, acountry with a population of just 1.64million living on a land area covering11,000 square kilometers, but which hasundergone considerable developmentover the years.

Occupying a strip of land that pro-trudes into the Gulf waters from the largerArabian Peninsula and Saudi Arabia,Qatar has used its considerable oil and gaswealth to develop the economy. Sport isextremely important to the people of thecountry and the government is alwayskeen to support new ventures to enhanceits portfolio.

Of note, it has now hosted the AsiaCup twice, it held the 15th Asian Games in2006 and staged the 14th edition of theWorld Indoor Track and Field Champi-onships last year. It also stages interna-tional tennis tournaments and is an avidsupporter of motor sports, to name but afew. And it was recently announced thatQatar is set to bid for the 2017 World Ath-letics Championships.

Qatar is also home to the AspireAcademy of Sports Excellence, an elite

QATAR to host football World Cup 2022

Friends worldwide and neighbors welcome choice

by OPEC Bulletin Correspondent

“This is an opportunity to eradi-cate misconceptions, not justabout Qatar, but about the widerIslamic and Arab world. We area very welcoming country, ayoung nation. And we are notjust dreamers, we are achievers.”

Sheikha Mozah bint

Nasser Al Missned,

wife of Qatar’s Emir

Sheikh Hamad

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sports educational institute, which waslaunched in September 2004 and identi-fies promising student-athletes in the dis-ciplines of soccer, athletics, swimming,gymnastics, fencing and table tennis. Ofcourse, the beautiful game – football – isthe most popular sport in Qatar, so thefact that the country has been selected tostage the World Cup is the proverbialicing on the cake – it can get no better.And there are no more delighted aboutthe news than the country’s Emir, SheikhHamad Bin Khalifa Al Thani, who saidafter the decision was announced thatFIFA’s bold decision to award the hostingrights for the 2022 World Cup to Qatarrepresented a milestone for football in theMiddle East.

He was quoted as saying that hebelieved that the competition presentedthe region with a fantastic opportunity.

In addressing comments to FIFA, the Emirsaid: “On behalf of millions of people liv-ing in the Middle East, thank you forbelieving in us, thank you for having sucha bold vision. Thank you also foracknowledging this is the right time forthe Middle East. We have a date with his-tory which is summer 2022.”

He acknowledged that his countryhad a lot of work to do to prepare for thetournament, but pointed out that Qatarwould stand by its promise to deliver andwould honour “the sacred trust given tous today.” The Emir added: “We willdeliver with a lot of passion and we willmake sure this is a milestone in the his-tory of the Middle East and in the historyof FIFA.”

Sheikha Mozah bint Nasser AlMissned, wife of the Emir, was quoted inan interview with Reuters as saying that

the tournament was not just for Qatar –but for the whole region. “This is anopportunity to eradicate misconceptions,not just about Qatar, but about the widerIslamic and Arab world. We are a very wel-coming country, a young nation. And weare not just dreamers, we are achievers,”she affirmed.

It was Sheikha Mozah who was at theheart of the final presentation that helpedpersuade FIFA to choose her country overthe others in contention. Interestingly,the only other bid to have their final pres-entation spearheaded by a woman wasRussia, winner of the 2018 tournament.

To back all the words of optimismexpressed, Qatar will be investing heav-ily over the next years to prove itself aworthy host. Reports say it intendsbuilding a US$25 billion rail network, aUS$5.5bn deep-water seaport, and a �

FIFA President Sepp Blatter announces Qatar as the host nation for the FIFA World Cup 2011.

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OPEC

� new airport, costing US$11bn, whichwill be connected to large residential andcommercial projects in the northern partof the capital, Doha, by a US$1 bn cross-ing. The Emirate will also spend an addi-tional US$20 bn on providing new roads.

For the tournament itself, the coun-try is planning to construct no fewer thannine state-of-the-art stadiums, at an esti-mated cost of US$3 bn. Plans are also inplace to provide a metro system connect-ing each of the stadiums, which will benot more than one hour apart from eachother.

One of the doubts cast about Qatar’sbid was the extreme temperatures theplayers, fans and officials would have toendure in the summer months when theWorld Cup is customarily held. At thattime of the year, it is not uncommon forthe country to have temperatures well inexcess of 40° Celsius.

However, the Qatari authorities havecome up with a novel idea to provide allits new stadiums with solar-powered airconditioning that will keep the tempera-ture on the pitch at around 27° C, ensur-ing comfortable conditions for both play-ers and fans.

However, both Sepp Blatter andUEFA chief, Michel Platini, have gone onrecord as saying they would not beadverse to the idea of staging the tourna-ment in January or February, when theweather is cooler. That was the case forthis year’s Asian Cup, which was held invery pleasant conditions.

However, Asian Football Confedera-tion President, Mohamed Bin Hammam,is adamant that the competition willremain a summer event. Himself aQatari, and seen as a frontrunner to even-tually replace Blatter at FIFA, Bin Ham-mam is convinced that Qatar can “orga-nize a very good World Cup, an amazingWorld Cup.” He was instrumental inhelping bring the tournament to hishomeland.

Nonetheless, Bin Hammam, whohas been a FIFA executive since 1996, didnot totally dismiss the possibility of anearlier tournament, stating that Januarywas a season during which several of theleagues in Europe suspended fixtures, dueto the winter. Whether the tournament isheld earlier in the year, or in the summer,one thing is certain – Qatar is aiming tomake it one of the most successful WorldCups ever.

Bruno Metsu, coach of the Qatariteam that competed in January’s AsiaCup, said he was sure Qatar would organ-ize a fantastic World Cup. “We have timeto prepare a strong team over the next 11years to be ready for the World Cup.”Metsu, who took Senegal to the quarter-finals of the World Cup in 2002, pointedout that the huge investments Qatar hadmade in sport were already paying divi-dends. “I think people will be surprised.The stadiums will be ready for spectatorsand players and it will be fantastic forfootball,” he was quoted as saying. �

“On behalf of millions of peopleliving in the Middle East, thankyou for believing in us, thank youfor having such a bold vision.Thank you also for acknowledg-ing this is the right time for theMiddle East. We have a datewith history which is summer2022.”

Emir, Sheikh Hamad

Bin Khalifa Al Thani

Qatar's 2022 World Cup bid chairman Sheikh Mohammed bin Hamad bin Khalifa al-Thani (left),FIFA Secretary-General Jerome Valcke (middle) and Qatar's Emir Sheikh Hamad bin Khalifa alThani (right) hold a replica of the World Cup after the announcement that Qatar will be hostnation for the FIFA World Cup 2022.

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