ITFC and STO sign USD 189M trade financing agreement

The International Islamic Trade Finance Corporation (ITFC) has signed a USD 189 million trade financing agreement with the State Trading Organization (STO) – the corporation’s largest syndicated Murabaha trade financing agreement.

The agreement was signed by ITFC’s CEO Hani Salem Sonbol and STO’s CEO and MD Hussain Amr Mohamed Rashad in a ceremony at Hotel Jen in Male’ City on Sunday.

The signing of the agreement was witnesses by Maldivian Finance Minister and Islamic Development Bank Group (IsDB) Governor Ibrahim Ameer.

According to STO, the agreement is a renewal and increase of an existing Murabaha trade facility, and will support the procurement of petroleum products, staple food, medicine, and medical equipment to aid in Maldives’ post-COVID-19 economic recovery.

Sunday’s ceremony also saw the signing of a Memorandum of Understanding (MoU) between ITFC and Maldives Industrial Fisheries Company (MIFCO) to support the company with trade-related technical assistance.

According to STO, the MoU is aimed at enhancing MIFCO’s competitiveness and access to global markets.

Speaking at the ceremony, Sonbol said ITFC was pleased to sign the landmark agreements.

“ITFC is extremely pleased to sign its largest syndicated trade finance agreement with STO to finance the import of strategic commodities to support the recovery of the economy from the pandemic. Apart from the support extended on the trade financing front, the MoU with MIFCO is also a major milestone given the fishing sector’s strategic importance to the economy.  Capacity building and technical assistance initiatives offered to MIFCO is expected to boost the fisheries sector’s competitiveness,” he said.

 Sonbol said ITFC looked forward to continuing to support trade finance and development in Maldives.

Meanwhile, Amr highlighted on the long-standing partnership and cooperation between Maldives and ITFC, and especially its support for procurement of essential commodities.

He also said the MoU signed to support capacity development of MIFCO was an important step, which will directly contribute to the growth of the fisheries sector.

Amr thanked ITFC for its continued support.

He said the renewal of enhanced facility comes at a critical time as global commodity prices rise due to ongoing war in Russia-Ukraine, and as Maldives faces economic recovery from pandemic.

“The facility will enable to ensure energy, food and medicine security in the country, while supporting economic stability and growth in key sectors,” he said.

ITFC declared Maldives as a member country of the corporation Sunday.