Islamic bank launches $10 bln poverty fund

from Reuters

By Diadie Ba

DAKAR, March 30 (Reuters) - The Islamic Development Bank launched a $10 billion fund on Wednesday to combat poverty in developing Muslim nations in Africa and other parts of the world.

The fund, which has an initial endowment of $1.4 billion, will be dedicated to alleviating poverty, promoting health and universal education, and empowering women in the bank's 56 member countries.

"This launching ceremony of the IDB's Poverty Alleviation Fund symbolises a revitalisation of the Islamic community in a world where unmatched wealth is next to absolute poverty," the host of the bank's annual meeting, Senegalese President Abdoulaye Wade, told delegates.

Saudi Arabia has already pledged to contribute $1 billion, Kuwait $300 million, Iran $100 million and Senegal $10 million, bank officials said.

The aim of the fund is to help meet the U.N. Millennium Development Goals (MDGs), proposed by then-Secretary-General Kofi Annan and approved by world leaders in 2000.

They include cutting extreme poverty by half, ensuring universal primary education, and stemming the AIDS pandemic, all by 2015, among others.

IDB Vice-President Amadou Babacar Cisse said the Saudi Arabian-based bank would be active across the whole of the African continent, not just in those countries where Islam was the predominant religion.

"For us the main goal on the African continent is the fight against poverty," Cisse told Reuters. "We are not a religious-orientated institution."

Under Islamic law, the bank may not charge interest on its financial loans but it aims to cover its expenses in the projects it finances. It sees its operations complementing the activities of other multilateral lenders such as the World Bank.

"The Bretton Woods institutions are our long-time partners. We have always cooperated with those institutions," Cisse said.