The President of the Islamic Development Bank (IDB) Ahmad Mohamed Al-Madani has urged Turkey to mobilize “sukuk” (Islamic bonds) to facilitate the flow of capital from Arab countries, while also suggesting that Turkey could arrange an investment conference in order to attract Arab capital.
Al-Madani, in an exclusive interview held on the occasion of the opening of Ankara’s branch of the (IDB) in the presence of of President Abdullah Gül, highlighted the full confidence that they had in Turkey, as he noted that he didn’t have any direct or unconfirmed information about claims that the Arab capital has been inclined to leave Turkish markets.
“It is very natural to have an office for IDB in Ankara to enhance this relationship,” Al-Madani said on Sept. 19 in Ankara, while pointing to Turkey’s “very constructive” cooperation with the IDB for the last 39 years as one of the “major founding members.
Al-Madani also touched upon the IDB’s commitment to the development of Istanbul as a center of Islamic banking, as he expressed hope that through cooperation with the government, Istanbul would become a leader in Islamic banking.
The Turkish government had already taken several successful steps and the IDB stood ready to provide “any technical assistance and participate in the activities of this [Islamic banking] center,” he said.
When asked about the difficulties developing economies like Turkey experienced when attempting to attract direct investment and what Turkey’s methodology for attracting investment should be, Al-Madani noted that the sukuk recently issued had been successful and would continue to be in the future.
“I think the atmosphere here in Turkey is very favorable and we will be very happy to cooperate with Turkey to have a kind of investment conference in order to attract investors from other member countries and outside membership for other countries in order to know more about their investment opportunities in Turkey,” he said.
He glossed over the recent suspension of the United Arab Emirates’ (UAE) $12 billion investment in a coal-based energy project, claiming to have full confidence in the Turkish markets.
As of Sept. 19, the Treasury announced that Turkey mandated banks for its second sovereign sukuk issue in international markets and would hold a series of investor meetings from Sept. 23 to Oct. 1 in the Middle East and Asia.
Turkey raised $1.5 billion with its debut dollar-denominated sukuk last September.
Turkey has borrowed $4.2 billion from international capital markets so far this year and plans to borrow a total of up to $6.5 billion through a mix of Eurobond, Samurai and sukuk issues by the end of the year.