The United Nations Development Programme (UNDP), has signed a Joint Statement of Intent with the Islamic Corporation for the Development of the Private Sector (ICD) (https://ICD-PS.org) and the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC) —both members of the Islamic Development Bank (IsDB) Group—introducing a new blended finance structure that leverages credit insurance to catalyze private investment in climate-smart sectors.

This partnership will unlock capital for green small and medium-sized enterprises (SMEs) and support national efforts to achieve climate and sustainable development goals across the Arab States region. It will support financing across a broad range of sustainability-related areas, including climate change mitigation and energy transition, climate adaptation and resilience, sustainable water usage and governance, circular economy and management, sustainable agriculture and food systems and other green finance sectors.

“Across our region, SMEs are the backbone of economies and helping them grow and innovate is critical to strengthening economic resilience and climate ambition,” said Abdallah Al Dardari, UN Assistant Secretary General and Director of UNDP’s Regional Bureau for Arab States. “Through this new partnership we will work closely with regional financial institutions to expand SMEs access to green finance, to accelerate inclusive, climate-resilient development in line with UNDP’s flagship Green Finance Platform.”

In countries benefiting from the new partnership, ICD will provide financing facilities to partner banks and financial institutions while ICIEC will offer comprehensive credit insurance and risk-sharing solutions to encourage financial institutions to expand financing to green sectors, in addition to leveraging reinsurance partnerships to enhance the facility’s capacity and long-term sustainability.

"By uniting ICIEC's risk mitigation, ICD's financing, and UNDP's development network, we are creating a scalable engine for green private sector growth,” stressed Mohammad Asheque Moyeed, Acting Director, Banking Department at ICD. “This partnership is our shared commitment to building a more inclusive and sustainable future for SMEs across our member countries."

"Our role in this partnership is to unlock capital for the SMEs driving a greener, more diversified economy,” explained Yasser Alaki, Director of Business Development, ICIEC. “Through our credit insurance solutions, ICIEC provides the essential risk assurance that enables financial institutions to confidently channel financing toward this vital growth sector."

Serving as a convener of the partnership, UNDP will facilitate linkages between financial institutions and SMEs engaged in its programmes and will coordinate joint efforts to mobilize resources to lower the cost of risk-sharing mechanisms.