IslamicFinance.de

The Islamic Investment Infrastructure Bank, a unit of the Jeddah based Islamic Development Bank (IDB) is expected to be founded in 2016 as a new cross-border institution jointly by the IDB, Indonesia and Turkey. The bank will act to raise funds by means of sukuk issuances to fund infrastructure projects. The bank’s founding members will invite other countries to join as shareholders. Indonesia is also among the 57 prospective founding members of the China-led Asian Infrastructure Investment Bank (AIIB) founded in late 2014. This international financial institution has been regarded as China’s strategy to reduce the influence of the International Monetary Fund (IMF), Asian Development Bank (ADB) and World Bank.

Indonesia will become a founding member of a cross-border sharia-compliant infrastructure bank to help boost infrastructure development in various countries. The bank, named Islamic Investment Infrastructure Bank, will be cofounded with Turkey and the Saudi-based Islamic Development Bank (IDB), according to Finance Minister Bambang Brodjonegoro. To qualify as a founding member, Indonesia must contribute more than US$300 million. The sharia infrastructure bank is expected to be established in the second half of this year, following Indonesia’s announcement to join as one of the founding members in the upcoming China-led Asian Infrastructure Investment Bank (AIIB), which is also expected to help finance the country’s infrastructure projects.

Indonesia is set to co-found a new cross-border Islamic (sharia-compliant) infrastructure bank together with Turkey and Saudi-based Islamic Development Bank (IDB). Indonesian Finance Minister Bambang Brodjonegoro said that Indonesia will contribute more than USD $300 million as start-up capital for the establishment of the new bank, named Islamic Investment Infrastructure Bank (IIIB), which aims to boost infrastructure development in various countries. The bank is set to be established in the second half of 2015. Muliaman D, Chairman of the Financial Services Authority (OJK), recently stated that Indonesia and Turkey are competing to become host of the Islamic Investment Infrastructure Bank’s headquarters.