2022 Business Insured (USD)
billion
The ongoing war in Ukraine and global monetary tightening are the main
factors
hindering growth globally. The analysis predicts a global GDP growth of 2.9% in 2023, with the Chinese
government's shift away from its zero-covid policy providing support in the second half of the year.
Elevated oil prices are expected to persist due to the war, while global inflation is projected to
subside gradually. Trade is anticipated to slow down as household spending and business investments are
affected by inflation and geopolitical strains. Growth in Emerging Markets and Developing Economies
(EMDEs) is expected to be lower due to rising global interest rates and the channeling of resources away
from EMDEs.
Supply chain disruptions are also a cause for concern, and other risks to the global economic outlook
include the possibility of higher inflation and geopolitical fragmentation. ICIEC operating countries
are discussed in terms of their economic growth, with Sub-Saharan Africa, the Middle East, Central Asia,
and other emerging markets analyzed. Finally, the top risks in ICIEC's operating environment are
summarized into five key megatrends: COVID-19's impact on trade, climate change ramifications, widening
inequality, global geopolitical tensions, and the significant role of technology in trade.
For the
15th
consecutive year
2022 Business
Insured by Sector
USD 51 million
Agriculture
USD 6,638 million
Energy
USD 427 million
Infrastructure
USD 2,473 million
Manufacturing
USD 95 million
Mining and Quarrying
USD 264 million
Health
USD 361 million
Retail and Distribution
USD 1,334 million
Other
Total Business Insured
USD 11.6 billion
19% YOY Change
New Insurance Commitments
USD 4.0 billion
27% YOY Change
Total Exposure
USD 4.6 billion
8% YOY Change
“ICIEC continued to thrive in 2022. We delivered outstanding results for our
clients, partners
and shareholders with energy transition and resilience high on the corporate agenda. In this
Annual Report of ICIEC, we highlight the Corporation’s key achievements, provide information on
our financial performance, introduce some team members contributing to delivering our mandates
to our stakeholders, and spotlight ICIEC’s most fruitful partnerships and impactful projects for
the year.
Despite the challenges posed by a range of factors from the ongoing war in Ukraine to the
ongoing effects of the COVID-19 pandemic, ICIEC has continued to support trade and investment in
its Member States while also focusing on long-term sustainable development by catalyzing
ESG-related transactions and projects that contribute to the UN's Sustainable Development Goals
(SDGs). As a trusted partner of international exporters, financial institutions, and investors,
ICIEC facilitates business opportunities for its stakeholders, covering transactions in various
sectors like infrastructure, healthcare, and food security.
The organization's success is attributed to its team of professionals, the IsDB Group network, and the businesses in its MSs
that continue to push for impactful collaborations. “
Oussama Abdul Rahman Kaissi
Chief Executive Officer
ICIEC contributed to the implementation of the Strategic Preparedness and Response Program (SPRP), in cooperation with the IsDB Group, providing cover amounting to USD 1.4 billion to support efforts of MSs in the COVID-19 pandemic. Including USD 528 million for the Healthcare sector, USD 824 million towards Supporting imports of essential commodities, and USD 62 million to Support recovery of Small and Medium-Sized Enterprises (SMEs) from the economic impacts of the pandemic.
ICIEC supports transactions ranging from covering investments in large infrastructure projects (in traditional energy or renewable energy, transport, and healthcare industries), imports of essential products, pharmaceutical supplies, and enhancing food security of its MSs.
ICIEC supported essential ESG-related Ugandan infrastructure projects across Water, Electrification, Education, Agriculture, and Healthcare sectors. Uganda’s Ministry of Finance tapped a 10-year EUR196 million (USD 155 million) ECA-backed loan from Standard Chartered Bank with 95% cover from ICIEC’s Non-Honouring Sovereign Financial Obligation (NHSFO) guarantee to finance those schemes. The facility will also bridge a shortfall in project funding the Ugandan government is facing following COVID-19. All selected projects are ESG-related with significant developmental impact in Uganda and will, after completion, immediately improve the lives of millions of people. The backed financing will support agriculture, solar energy, a fundamental source of power generation to mitigate climate change, water infrastructure and healthcare. Other key impacts of the projects comprise: improved living conditions, increased access to safe drinking water to 95%, increased life expectancy and health-adjusted life expectancy, improved food security conditions, increased agriculture productivity, and the promotion of the green economy.
ICIEC insured FIM Bank, Malta, Incomlend Singapore and Bank of Africa UK for
their facilities totalling USD 95 million to support trade transactions in various MSs. The
BMP-C being offered to non-MS banks is expected to increase strategic exports/imports from MSs
for fertilizer, petrochemicals, steel and Agri commodities.
Promoting MSs exports and bilateral trade amongst all MSs is key to realizing the race to net
zero. Strategic goods will positively impact the green industrial revolution and will be a boon
for large-scale projects and trade across MSs. This project realizes SDG 2, 8 and 13. The
support of the steel trade will promote key ESG-related infrastructure projects and the delivery
of fertilizers will be crucial to promoting agri-business across MSs. The project shall also
improve the food self-sufficiency of the country while also helping to improve the efficiency of
the agriculture sector by using the latest technology in irrigation equipment. The financing
will help upgrade and improve efficiency for petrochemical projects across MSs.
ICIEC supported essential ESG-related Ugandan infrastructure projects across Water, Electrification, Education, Agriculture, and Healthcare sectors. Uganda’s Ministry of Finance tapped a 10-year EUR196 million (USD 155 million) ECA-backed loan from Standard Chartered Bank with 95% cover from ICIEC’s Non-Honouring Sovereign Financial Obligation (NHSFO) guarantee to finance those schemes. The facility will also bridge a shortfall in project funding the Ugandan government is facing following COVID-19. All selected projects are ESG-related with significant developmental impact in Uganda and will, after completion, immediately improve the lives of millions of people. The backed financing will support agriculture, solar energy, a fundamental source of power generation to mitigate climate change, water infrastructure and healthcare. Other key impacts of the projects comprise: improved living conditions, increased access to safe drinking water to 95%, increased life expectancy and health-adjusted life expectancy, improved food security conditions, increased agriculture productivity, and the promotion of the green economy.
(USD’000) | 2022 Actual |
2022 plan |
% Achieved |
2021 Actual |
% Growth |
---|---|---|---|---|---|
Policyholder's Fund Result | 3,439 | 2,023 | 170% | 3,834 | -10% |
Shareholder's Fund Result | 7,540 | 4,810 | 157% | 5,419 | 39% |
Corporate Net Result | 10,979 | 6,833 | 161% | 9,253 | 19% |
Gross Income | 2022 USD'000 |
% | 2022 USD'000 |
% |
---|---|---|---|---|
Equity and Funds | 748 | 9% | 495 | 9% |
Money market placements | 1,749 | 21% | 286 | 5% |
Sukuk | 5,483 | 65% | 4,510 | 79% |
Syndications | 484 | 6% | 406 | 7% |
Total Investment Income | 8,464 | 100% | 5,698 | 100% |
(USD’million) | 2022 | 2021 | % Change |
---|---|---|---|
Invested Funds* | 292 | 276 | 6.0% |
Total AUM* | 351 | 331 | 6.0% |
Investment Income | 8.5 | 5.7 | 48.6% |
Return on Invested Funds(%) | 2.89% | 2.07% | 40.1% |
Return of total AUM(%) | 2.41% | 1.72% | 40.1% |
ICIEC ensures that its commitment to reaching the SDGs is thoroughly embedded in everything it does, both internally and externally.
Committed to achieving food security in its Member States through strategic partnerships and supporting the imports of essential agricultural commodities, imports of modern agricultural machinery, and access to financial services.
In 2022, ICIEC supported over
in trade and investment in the agricultural sector.
Responding to urgent healthcare needs exacerbated by the global pandemic through ensuring foreign investments in health infrastructure and providing cover for the import of strategic health commodities, otherwise deemed too risky.
In 2022, ICIEC insured upwards of
in trade and investment in the health sector.
Expanding insurance support for developing modern and sustainable energy services through mitigating political and commercial risks associated with required infrastructure investments and exports.
In 2022, ICIEC supported
in trade and investment related to the clean energy sector.
Advancing economic growth, increased economic productivity and employment creation by facilitating strategic investments in the LDMSs and promoting export businesses to grow internationally.
In 2022, ICIEC insured over
for imports, exports outward and inward investment in least- development Member States and.
in labour-intensive industries.
Mobilizing funds for large capital-intensive infrastructure projects in the Member States such as building bridges, airports, and state-of-the-art medical facilities. Improving access to finance for SMEs and encouraging infrastructure investments through risk mitigation instruments for banks and medium/long-term financing.
In 2022, ICIEC supported
in trade and investment related to infrastructure sector.
Collaborating with Member States, banks, investors, corporates, national ECAs, and other development finance institutions. Transactions that would otherwise be deemed too risky are realized through ICIEC's strong network of partners.
In 2022, ICIEC established more than
with national ECAs, reinsurers, banks and other multilateral institutions.
Enhancing Impact
Enhancing Efficiency
Enhancing Resilience
ICIEC undertook a technical study of its capital requirements and secured a capital increase, which has succeeded in enhancing capacity and its credit rating.
As the only Shariah-Compliant multilateral credit and investment insurer in the world and a member of the IsDB Group, ICIEC plays a crucial role in Islamic Impact Finance. For instance, Green Finance and Green Bonds/Sukuk are vital. ICIEC’s Green Sukuk Insurance Policy (GSIP) allows issuers to attract capital for ‘green’ projects better. The GSIP is valuable for issuers in low-income and developing Member States, which are below investment grade rated and, consequently, attract less private capital for climate action. In short, Islamic finance will be paramount to promoting and realizing the SDGs across MSs, as Shariah-Complaint facilities become key tools in corporate exporters’ and importers’ financial toolkits.
One of ICIEC's core strengths is in its partnerships with various organizations, both within and outside the IsDB Group. These partnerships focus on diverse sectors and regions, extending the Corporation's reach and impact. Some notable partnerships and agreements include:
These partnerships reflect ICIEC's collaborations in various regions, such as Asia, Europe, and Africa, as well as its commitment to climate action, green finance, infrastructure development, and support for SMEs. ICIEC's will continue to pursue dynamic partnerships and their role in enhancing the organization's impact across diverse industries and regions.
The Annual Report reviews the progress of ICIEC's 10-Year Strategic
Framework
(2015-2025) and its mid-term strategic priorities (2021-2025). The strategic framework's
objectives
are to create short- and long-term development impacts in the Member States and maintain
financial
sustainability. To achieve these objectives, ICIEC established three strategic pillars: Market
Impact, Capital Optimization, and Organizational Strength.
The mid-term strategy review resulted in redefining the strategic pillars as (1) Enhancing
Impact,
(2) Enhancing Efficiency, (3) Enhancing Resilience, and (4) Enhancing IsDB Group Synergy. These
pillars align with the IsDB Strategic Realignment 2023-2025, focusing on boosting recovery,
tackling
poverty and building resilience, and driving green economic growth.
Key achievements under the Enhancing Impact pillar include facilitating intra-OIC trade and
investment, contributing to IsDB Group's Strategic Preparedness and Response Program (SPRP), and
promoting green economic growth. Under Enhancing Resilience, ICIEC achieved a financial
turnaround
from consistent deficits to positive technical results. Enhancing Efficiency saw progress in
business process optimization, organizational structure improvement, and leadership development.
Enhancing IsDB Group Synergy involved active contributions to group-wide initiatives and
programs.
Lastly, Enhancing Partnerships and Innovation involved establishing impactful partnerships with
Export Credit Agencies (ECAs) and exploring innovative solutions such as the "Arab Africa
Guarantee
Fund."
To be recognized as the preferred enabler of trade and investment for sustainable economic development in member states.
To facilitate trade and investment between member states and the work through shariah-compliant risk mitigation tools.
Following the downturns shocks in the world economy emanated by the
COVID-19
pandemic, the war in
Ukraine has added high uncertainties about the global outlook, which negatively impacted on
insurance operations across the world. Despite the dampened conditions, however, ICIEC continues
to tackle the economic consequences of the war and the lingering impact of the pandemic as the
Corporation’s business model has proven robust across different economic cycles. Undoubtedly,
the pivotal role of Risk Management is one of the most important factors that enabled the
Corporation to navigate successfully through the crisis period while upholding its strong credit
profile. ICIEC aims to consolidate the achievements made so far by strengthening the risk
management practices and architecture to support the achievement of the 10-year strategy. The
Risk Management paradigm is akin to safeguarding business continuity, achieving sustainability,
optimizing capital allocation and utilization with a forward-looking risk-based capital planning
while enhancing the overall performance of the Corporation through a tailored Enterprise Risk
Management (ERM) architecture.
ICIEC’s core risk stems from (i) underwriting of trade credit and political risks through the
PHF: (ii) investment operations of its SHF: (iii) counterparty risks arising from outward
reinsurance of its insurance exposure. Other risks arise from its overall activities in diverse
and complex forms, being a specialized multilateral insurer (SMI).
In recent years, ICIEC has made significant progress in strengthening its risk management
paradigm and achieved appreciable milestones. The Corporation developed and implemented a Risk
Appetite Statement (RAS) which has been approved by the BOD. The RAS articulates in written form
the aggregate level and types of risk that the Corporation is willing to accept, or to avoid, to
achieve its business objectives.
ICIEC has adopted a balanced approach to support MSs’ developmental needs amid crises whilst
maintaining a sound portfolio with robust risk management, prudent underwriting, and loss
minimization efforts. This has been further enhanced by the strong follow-up and prudent
monitoring using effective risk management capabilities and management’s timely intervention in
strategic key points supported by IsDB Group synergy.
Inception to 2022 (USD billions) |
Imports | Exports | Outward Investment | Inward Investment |
---|---|---|---|---|
South east asia | 10.369 | 1.704 | 0.441 | 1.994 |
Arab Asian Countries | 17.978 | 40.429 | 2.646 | 1.533 |
Central Asia And Europe | 5.773 | 13.749 | 3.466 | 3.861 |
East and Central Africa | 0.791 | 0.212 | -- | 1.751 |
North Africa | 10.497 | 5.996 | 0.695 | 4.210 |
West Africa | 4.219 | 0.142 | -- | 5.853 |
Grand Total | 49.627 | 62.232 | 7.248 | 19.202 |