EBRD provides $2 million trade finance line to Arab Islamic Bank to boost Palestinian exports and imports

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  Trade finance line worth $2 million to Arab Islamic Bank (AIB)
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  Mechanism to provide much-needed support to local importers and exporters
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  AIB will gain access to more than 100 issuing banks and 800 confirming banks worldwide

The European Bank for Reconstruction and Development (EBRD) is boosting Palestinian export and import activities by providing a $2 million trade finance line to the Arab Islamic Bank (AIB).

The trade finance facility, provided under the EBRD’s Trade Facilitation Program (TFP), will be used to issue guarantees in favor of confirming banks for pre- and post-import financing, and will assist private companies there with its trade finance activities.

This limit comes at a crucial time for the West Bank and Gaza, as the war in Gaza that began in October 2023 is affecting the West Bank economy. Recent estimates indicate that the local economy will contract by at least 6.4 percent by the end of 2023 due to job losses and increasing security tensions, which affected mobility and business activity.

By joining the TFP and receiving the commercial line, AIB will gain access to a global community of more than 100 issuing banks and 800 confirming banks, expanding its correspondent banking network and international business opportunities. AIB employees will be able to benefit from a wide range of seminars and training on trade finance best practices.

AIB is the largest Islamic bank in the West Bank and Gaza and a subsidiary of the Bank of Palestine (BoP), the largest bank in the West Bank and Gaza and a client of the EBRD since 2020.

Mike Taylor, EBRD Director for Financial Institutions in the Southern and Eastern Mediterranean region, said: “We are delighted to welcome the Arab Islamic Bank to our network. This trade finance cap is our first cap with an Islamic bank in the West Bank and Gaza, and will not only support Palestinian exporters and importers, but will also provide trade finance training opportunities at AIB.”

Hani Nasser, CEO of AIB, commented: “The cooperation with the EBRD is an important milestone for AIB, as it will enhance the trade facilitation services provided to AIB clients, as well as having access to banks around the world to through the EBRD partner network. . It is an opportunity for AIB to establish strong relationships with new correspondent banks. The benefits go beyond trade transactions, as the EBRD provides trade finance tools through training courses for AIB employees.”

The PTF was launched in 1999 to promote international trade between the economies of the Bank’s regions, in the form of guarantees and short-term loans to selected participating banks and factoring companies.

Since the start of its operations in the West Bank and Gaza in 2017, the EBRD has signed 24 projects with a total value of €118.7 million.