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OFID Ministerial Council holds 28th Session in Carinthia

 Council Chairman advises greater efforts to move development forward

14/2007 June 13, 2007, Pörtschach, Carinthia, Austria,
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The Ministerial Council of OFID, the OPEC Fund for International Development, today concluded its 28th Annual Session in Pörtschach, Carinthia, Austria. The Council re-elected, as Chairman, HE Dr. Ibrahim Al-Assaf, Honorable Finance Minister of the Kingdom of Saudi Arabia; and, as Vice-Chairman, HE Dr. Davoud Danesh Jafari, Honorable Minister of Economic Affairs and Finance of the Islamic Republic of Iran.

Addressing the Council, the Chairman described OFID as a healthy, forward-looking institution, with which cooperating countries gladly did business. Dr. Al-Assaf said OFID was “working diligently to enhance human capital, build productive infrastructure and help develop utilities; all in the context of sustainable development.”

The reason OFID does this work, said the Council Chairman, was mainly to help lift people out of poverty.

On the eight seminal Millennium Development Goals (MDGs), whose accomplishment the international community is committed to, Dr. Al-Assaf noted that the goals were still not on target. “Even more worrisome,” he declared, was the projected decline in prospects for sub-Sahara Africa. He reminded the Council that OFID, as an institution, has, for years, worked toward the accomplishment of these goals.

Said the Chairman: the needs of the world are actually increasing, rather than diminishing; “and everyday, it seems, more challenges emerge: global warming; energy security; capacity building; technological innovation and food security.” He pledged that OPEC Member States, as a donor group, would continue to provide what they could to ensure a healthier and more equitable global environment.

The Chairman extended the Council’s collective thanks to the Austrian people and Federal Government for the sustained and consistent hospitality they had shown to OFID over 31-years. He also expressed gratitude to the Austrian province of Carinthia and the people of Pörtschach, for their generosity.

In his own customary statement to the Council, HE Mr. Jamal Nasser Lootah, Chairman of OFID’s Governing Board, gave an overview of the global economic environment in which OFID operated in 2006 and surveyed prospects for 2007.

  1. In his own customary statement to the Council, HE Mr. Jamal Nasser Lootah, Chairman of OFID’s Governing Board, gave an overview of the global economic environment in which OFID operated in 2006 and surveyed prospects for 2007.

    2. HE Mr. Lootah said the global economy saw continued, strong and broad-based expansion in 2006. Thus, global economic output reached 5.1%, underpinned by an upturn in investment, favorable financial market conditions and “accommodative macro-economic policies.” Output rose to 3.1% in the advanced, industrial economies, and was sustained at 7.3% in developing and emerging market economies. Consequently, world trade grew by 8.9%, and inflation stayed subdued at about 4%.

    On prospects for 2007, Mr. Lootah said the expectation is for world economic growth to decelerate to 4.9%, largely triggered by a slowdown in the U.S. and Europe.

  2. OFID Director-General, Suleiman Jasir Al-Herbish, presented an overview of the institution’s operational status. He prefaced his presentation with a comment on the year 2006, which he said was a particularly eventful year for the institution. He said 2006 would be remembered as a defining period for OFID. It was the year that marked the 30 th Anniversary of OFID’ and one that witnessed the emergence of a more dynamic institution with a new corporate image. Together with a multiplicity of activities carried out within the context of a Public Information Campaign, this has led to OFID enjoying a higher profile today.

    3. On operational matters, the Director-General informed the Ministerial Council that by December 31, 2006, OFID had extended a total of 1,113 public sector loans, worth US$6.7 billion. Around one-half of this has gone to Africa. An additional US$518 million had been approved under the Private Sector Facility. Assistance amounting to US$379.5 million had been committed in grant aid, while another US$10 million had been provided as trade financing, under the newly-created Trade Finance Facility (TFF), which was established following last year’s Council meeting in Jeddah. OFID’s total commitments, therefore, as of year end 2006, amounted to US$7.6 billion. This sum excludes the substantial contributions channeled through OFID by Member States to the resources of IFAD and the IMF.

    Mr. Al-Herbish reported that in the course of 2006 itself, OFID approved a record US$700 million in fresh financing for over 150 operations. From this amount, a total of US$558.6 million was given in public sector loans, including HIPC and the Blend Facility, with the lion’s share going to low-income countries. Energy overtook transportation as the sector attracting the most lending, breaking an eight-year trend. A further US$31 million was committed through the grant window, while investments in the area of private sector financing amounted to US$100.2 million. Following the launch of the new TFF, one operation worth US$10 million was approved. Disbursements for the year reached US$304.8 million.

  3. The Ministerial Council considered and adopted OFID's Annual Report for 2006 (see separate press release number 15/2007). It also reviewed and approved the audited Financial Statements of OFID for fiscal 2006. External Auditors were appointed for 2007.

  4. 4. The Council reviewed Reports on the Implementation of OFID’s Corporate Plan, which included a Management presentation on ways and means of enhancing OFID’s financial resources; the 17th Lending Program and Blend Facility and [progress on] the new TFF.

  5. The Council unanimously approved replenishments for two major Special Grant Accounts of OFID: US$15 million, each, for the Grant Account for Palestine and the Grant Account for HIV/AIDS Operations (see separate press releases numbers 16/2007 and 17/2007).

  6. Also at the Council Session, the second OFID Annual Award for Development was presented by Council Chairman Dr. Al-Assaf to SOS Kinderdorf, an Austrian humanitarian, non-governmental organization (NGO) engaged in child- and orphan care worldwide. The first OFID Annual Award for Development was presented in Jeddah last year to HUMANA People-to- People, an NGO based in Zimbabwe.

  7. The 29th Session of the Ministerial Council will take place in June 2008, in IR Iran.