The Islamic Development Bank (IDB), which has so far limited its funding to government bodies, has set up an institution with one billion dollars in capital to promote the private sector in member countries.
The aim of the institution will be "to support the efforts of economic development in Islamic member countries and encourage private projects in line with the principles of Sharia" laws of Islam, the IDB said.
Like the bank, it will be based in Jeddah, the trading capital of Saudi Arabia, which has launched economic reforms to encourage the private sector, it said in a statement late Saturday.
The 58-member IDB will put up half of the capital while member countries will account for 30 percent in the form of shares and the rest will come from financial institutions in Muslim countries.
The board of the institution, chaired by IDB president Ahmad Mohammad Ali, is to hold its first meeting on August 5th.
The 58-member Islamic Development Bank, founded in 1975, provides assistance to Muslim states through loans and grants in keeping with Sharia laws, which ban the payment of interest - JEDDAH (AFP)
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