BAKU, Azerbaijan, June 17. Political risk insurance helps turn regional projects into investment-attractive ventures while expanding access to financing by mitigating investor risks, Khalid Khalafalla, CEO of the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), said during the 14th Private Sector Forum of the Islamic Development Bank Group, Trend's correspondent reports from the event.
"Political risk insurance does not mean that a country is necessarily high-risk. Sometimes the risk exists only in the perception of investors due to the information background. Our insurance coverage allows banks to obtain a significant reduction in credit risks, which helps mobilize more resources and attract additional financing," he said.
According to Khalafalla, ICIEC was established to support the exports of the Organisation of Islamic Cooperation (OIC) member countries and to attract foreign direct investment by providing political risk insurance to investors and financial institutions.
He noted that since its inception, the corporation has insured trade and investment transactions worth $139 billion, of which about $57 billion accounted for intra-OIC trade.
"This directly contributes to regional integration and trade development among member states," Khalafalla emphasized.
The head of ICIEC announced that a significant portion of the organization's activities is focused on insuring infrastructure projects, primarily in the transport and energy sectors. According to him, such projects are implemented jointly with international financial institutions and export credit agencies.
As an example, he cited ICIEC's participation in metro projects in Riyadh and Dubai, as well as three railway projects in Turkey implemented last year. One of these is located near the border with Azerbaijan and will facilitate the development of exports from Türkiye to Georgia, thereby strengthening regional integration.
"The main part of our investment insurance goes into infrastructure projects—transport and energy. It is precisely these sectors that hold key importance for strengthening regional integration and developing trade between neighboring countries," Khalafalla added.
