In a significant move to strengthen its energy sector, the Republic of Djibouti has entered into a financial agreement valued at $90 million with the International Islamic Trade Finance Corporation (ITFC), which operates under the Islamic Development Bank Group (IsDB). This agreement was solidified through the signing by Eng. Hani Salem Sonbol, CEO of ITFC, and Djibouti’s Minister of Economy, Finance and Planning responsible for industry, Ilyas Moussa Dawaleh.
The primary aim of this Murabaha Agreement is to enhance the nation’s energy security by financing the import of vital petroleum products necessary for generating electricity. This influx of capital is expected to stimulate growth across various sectors of Djibouti’s economy. Additionally, the deal is designed to promote intra-trade among member states of the Organization of Islamic Cooperation (OIC), as the petroleum imports will predominantly originate from fellow OIC countries.
ITFC’s support extends to multiple facets of Djibouti’s economy, including energy, services, manufacturing, and agriculture. Eng. Sonbol highlighted that the agreement is set to fortify the existing strategic partnership between ITFC and Djibouti, particularly in the energy domain, which will, in turn, have a favorable impact on the country’s human and economic resources.
This financial collaboration is part of a larger framework agreement, which involves a $600 million commitment made by ITFC to Djibouti in May 2023. Such strategic agreements underscore the ongoing commitment of ITFC to bolster economic development within its member states.