Financing the Middle Corridor for Resilient Transport and Trade

[00:00:00]which is anchored on the pre-esigned KPI criteria which can help reduce the coupon rate afterwards in in particular in Southeast Asia. I think that this kind of exper experience can be replicated and applied in Central Asia region in particular for the middle corridor project design. So I look forward the further collaboration that are working closely with the various stakeholders in the region to support the middle corridor project. Thanks.

[00:00:28]>> Thank you very much. Now I will jump from Asia to uh the ISDB group and we'll ask Mr. Nali about um access to trade finance remains a key constraint for businesses along the corridor. So from ITFC perspective, what practical solutions can help improve access for these businesses and how can ITFC collaborate with development partners including other MDBs to deliver a more integrated financing approach.

[00:01:04]Thank you. Thank you, sister May. Uh so thank you for having me with you today and good morning to everybody. Uh I just want to quick introduction of what ITFC is. Uh it stand for the International Islamic Trade Finance Corporation. uh a subsidiary of the Samic Development Bank Group was established uh in 2008 for the full purpose from the name is for trade finance. Uh it existed therefore now for almost uh what's uh 19 years now that we I 19 years of activities this year. uh we have done uh uh over $93 billion of trade finance on funded basis while we have also business or unfunded which is a lot of credit. Uh just also to also to add that uh we since although we exist 2008 but as an activity of function of trade final it existed since 1977 within the IDB. We used to be a department in IDB when IDB was established at that time 1977.

[00:02:15]So the the key point to remember is that uh in IDB uh when they do the pro the purpose of IDB is for socioeconomic development through project it was the first multilateral to recognize the important role of trade in the o in the in in bringing the additionality to the soio economic development of member countries. So what happened is that IDB created trade finance from the from the from the inception as they believe as it as integral part of of development and and this is that has become part of the our tradition for trade and other multia come with trade later on.

[00:02:57]So cumulatively between 77 until now we have done more than $130 billion of trade finance taking account the component when we do it to do and the IDB that said is uh although we do trade finance and ITFC as our main activity we also have another pillar which is trade development and trade facilitation uh trade link capacity building uh uh uh uh uh activities So uh the trade finance part uh in any of type of ambitious project like a corridor uh is very important uh in the sense that it's bring uh as I say that uh the the corridor will will bring the connectivity uh between region and trade finance combined with trade facilitation connect the dock all right which is missing from hard infrastructure to come to the soft infrastructure.

[00:03:56]That said uh trade finance by itself or trade of itself uh is not a the solution. Okay. We we see we have a limitation uh coming up for for the potential for trade in the corridor. But trade finance is cannot create trade first. The trade has to exist. All right. We can we are become an enabler catalyst for the trade to happen. But first the trade has to be there. All right. And and we will come in in the picture after or when it is ready. But that said, therefore the trade potential exist. The bottleneck it will not be in the trade finance. But what is how you can bring a good very simple what if trade is international trade is good. A good to from place A to place B.

[00:04:51]somebody agreed to buy that good and the shipping to bring it from the A to B and the finance will come in to pay for that goods. So you see that what I'm trying to say is the the the process the trade finance or trade com the trade payment will come after what therefore any bottleneck uh in this in this uh transport value chain all right will limit the possibility to do trade finance will limit the possibility formemes and corporate within the the corridor uh to to to interact. So we are happy to be able to be part of it.

[00:05:31]However, the the limitation faced bymemes and business operators is not only limited to the corridor but all over the world. We know for example according to ADB estimate the trade finance gap formemes is estimated at $2.5 trillion dollars. All right and that's huge and see we alone cannot be a a solution. we need to join hand with all our partner. So the way the solution I can see is uh we work hand in hand on uh with the development of infrastructure coming up in place create the environment for the trade to happen trade fun people like ITFC and other multilateral can join hand to bring financing tomemes through empowering local banks putting line of finance to them. Now another aspect is once this potential is is is going up. All right.

[00:06:30]ITFC can play its role of fund mobilizer to why because ITFC within our trade finance. All right. Mobilize $4 for each dollars it put in them in in in any financing. So today uh ITFC is recognized number one ranked number one by Bloomberg as a lead mandated arranger in Islamic syndication. So we have the potential we have got a reputation. So we can do it just that the trade has to exist and then we can bring our our now when we do trade finance we recognize also that trade finance itself is not a solution. We need to create what we call trade solution. That's where we bring in trade development, trade facilitation uh initiative as well a capacity building, trade related capacity building to put in place. And I wanted to say that we uh less than two years ago uh we uh put up a program ambitious program called trade connect as plus. Trade connect central Asia plus because plus mean aan because Azaban part of central Asia. So we call it plus. This involves six countries in the region from Kazakhstan to Adaban that we want in order to develop the trade infrastructure, soft infrastructure which involve trying to see how we can do among other things is uh uh enhancing paperless borderless custom procedures, digitalization of shipping document and custom document interoperability of digital system while maint maintaining national security and sovereignty over their own system interpret is very important data exchange and coordination between private sector and government agencies in order to make that it happen. So we working on that we look forward for partners to join us in this program but we're working with the countries and we are proud to that we already started a few project in central Asia that is aligned to the to the middle corridor uh initiative. Thank you.

[00:08:41]>> Thank you very much. and uh so they have to be trade then we come with financing trade. I think that's a very important uh element to consider because we think that just trade finance comes in and we don't think what is happening on the ground. So thank you very much for that and adding the ITFC perspective on uh working on the whole ecosystem to make sure that there is trade solution facilitation and financing. Now I turn to Miss Yang and uh this is a smooth transition from discussion on thememes to talk about the private sector. So AIB is playing a key role in financing sustainable infrastructure and advancing regional connectivity while also catalyzing the private sector participation. So given the significant untapped capacity along parts of the middle corridor, what are the most bankable PPP components across the corridor and how can AIB support this structuring?

[00:09:35]Uh thank you moderator uh may and I'm encouraged uh by uh the opening remarks made by excellency Rakman. He summarized really well all the critical elements of the middle corridor especially Asaban played a critical important role in enabling the middle corridor investment operational efficiency and also PPPs.

[00:10:04]So I think uh our uh speakers prior to me have already made it very clear um Mr. Aayumisan already mentioned number one priority is funding the bankable projects because for middle corridor as moderator you correctly highlighted you will need 28 billion over the next three years. So the infrastructure is still the number one priority for making the middle corridor working. We need more projects. It's not just uh roads, railways, but also vessels, fleets, ports, airports, uh operational systems, platforms.

[00:10:59]There are many operators in this middle corridor need to work together because middle corridor the number one feature is a multimodel corridor. It's not just one single um infrastructure uh sector. So everything needs to work together. So I think uh you can see the countries like Asaban has has done a lot of modernization uh over the past few days why I'm here I have been meeting with us authorities and SOE companies I'm deeply impressed they are already start they have started tackling the operational efficiency reliability and predict predictability.

[00:11:51]So the number one issue is infrastructure. Number two is operational uh efficiency as you actually excellency recommend highlighted in your operating marks because for us to make in middle corridor attractive for investors for shippers the most important thing is whether is reliable predictable.

[00:12:16]Currently you have uh in the old days it took one month to transport currently it's about 18 days it's still too high so how do we really reduce the number of days how do we really increase the reliability so in asan I can see they already set up um mutual transport which is really responsible for all different kind of models They have set up the ESCON holding company managing mega S so S so S so S so S so S so S so S so S so S so SOES yesterday I was also very impressed I visited ESCON shipping company they are actually thinking seriously investing the vessels digital platform and increase the different uh port capacities and also operating very closely with countries like Kazakhstan uh to see whether they can actually uh provide something like a supply chain management system for oper for uh shippers for um investors. So the number two priority is actually the institutions infrastructure and also operations. These three things need to work together seamlessly. And number three I think the moderator asked me to answer. I think my colleagues already answered very well on the PPP. So for uh middle corridor the current traffic uh level will not attract everything by private sector. There will be a lot of standalone projects need to be invested by government resources by sovereign based financing and then it is very critical to have uh organization like MCDF to provide grants to prepare the projects where the prop projects could actually you structure projects where you can finance by sovereign back financing.

[00:14:32]um no sovereign financing or S SOE so financing and concessional financing first loss guaranteed partial based credit guarantee blended financing all these are possible but provided those neighboring environment highlighted by my my colleague uh uh Dr. Jun Wu is very important. You have to have all these ingredients to enable a proper PPP structure. So I would not repeat. Thank you.

[00:15:06]>> Thank you very much uh for your contribution. Now I I have a question for uh all of the panel members. Uh you have been working for uh ADB, AIB, MCDF and ITFC. So covering the work with the uh public and private sector in Asia uh covering Africa and the rest of the world through MCDF and for ITFC. So from your collective experience across the different regions and sub regions. Uh what is the one key lesson that can be applied to the further development of the middle corridor? So if you think of one key lesson that you have seen uh in different regions or in sub regions or uh something that you think is successful and uh you need to bring it to the attention for those working on the media corridor I will start by Jean Wu perhaps it's a bit challenging question only to select one key issue per >> yeah okay so that's very generous for thank you very also I'd like to highlight the importance of the welldesigned project preparation. So not only the downstream but upstream middle stream the visibility study diagnostics economic analysis procurement design safeguard both environmental labor standard those are very uh important crucial point to ensure the success of the project design afterwards. For example in uh ADB we have launched a new uh project preparatory facility which is called the climate and sustainability project preparatory fund which is donated by both Korea and China Chinese government which could be very useful uh vehicle which can be used for the feasibility study for the various infrastructure project for the Korea going forward that's one information to share with you another key uh component is that uh outcome based project design and implementation is quite crucial just instead of just focusing on the expanding the cargo volume and the capacity of the port. But we need to pay more attention to the output. What kind of the ultimate goal we would like to achieve? For example, the middle corridor development should contribute to reducing the border delays, the lowering the trade costs and the facility crosser payment transit.

[00:17:31]how much these kind of outcomes we can uh ensure to achieve through various types of infrastructure project and soft infrastructure connectivity across the different stakeholders in the region. So in that sense the properly designed the KPIs should be put in place up front and then the each step of the progress should be measured accordingly the pre-esigned benchmark and criteria so we can measure ourselves how much progress we have made and what more needs to be done and what kind of external financing should be mobilized etc etc. So those are two points I would like to highlight. Thanks.

[00:18:05]>> Thank you. Uh Miss Yang.

[00:18:11]Uh thank you moderator. Uh I think the uh number one priority of middle corridor's political commitment uh the way we uh work with uh all the countries in uh involved in middle corridor. Uh we are very encouraged about the political commitment the really the coordination among the countries. uh are now up to very high level because this hasn't been seen in the past. So uh this is crucial to building the blocks along the corridor and very very importantly uh from our multilateral development banks we have a very critical role to play especially ISDB and uh uh all the development banks. Uh one critical sumble we can highlight now is uh the in rail uh projects we invest in Turkey all the I5s we invest six billion US dollars just for that project and AIB invested 1.5 billion warb invested two billion AIB uh ADB will invest also 1.5 billion ISDB invest Ed, EIB and all I you know all the related OPEC fund and others. Um so that is a very great sumble happening in middle corridor actually uh we are now not just uh approved the project by signing is coming very soon in weeks time. So that kind of level of commitment, the scale, the speed, the coordination mechanism, the implementation uh readiness are very very important. We hope we have more sambles like these to actually invest at that that level of scale. And not only that, the important thing is also how to mobilize private sector uh investment.

[00:20:31]There are many S so along the corridor.

[00:20:35]Another great sample I can highlight is recently AIAB invested Kazakhstan uh railway projects. It's a bypass new railway projects along the middle corridor. We invested the nearly 600 million through guarantee mechanism. So that guarantee mechanism will unlock multiple uh times higher commercial financing because of the back uh of aa backed agency together with uh war bank MIGA.

[00:21:12]That is a great another great example on how the Kazakhstan KTZ the railway agency is able to unlock the private commercial bank uh investment. It's coming. It is also done in a record time. So these are the two examples just happening this year and uh in my department we made it happen by working together with all other multilateral development banks. We look for more collaboration in um also in country like as Jang we are about to work with ADY together with ISDB and OPEC fund. So all these are lovely examples already happening. The commitment is very high, the coordination is in place. MTB's role is crucial. Thank you.

[00:22:06]>> Thank you very much. Uh Mr. Ayon, >> thank you.

[00:22:14]>> Um I think okay, first of all, you know, I started working for MCDF just about four years ago, but you know, before that, I was with the Asian Development Bank for over 30 years. So, you know, I've been u sort of you know dinosaur in the development banking business. Um so from that perspective let me you know miss me may let me respond to your question of what is most important lesson I have learned.

[00:22:46]Um I think the most important thing really to carry forward the regional cooperation initiatives such as you know middle corridor develop is one single lesson I can bring here is to be pragmatic.

[00:23:10]Uh okay what I'm saying is this now you know the at this we've been talking about $28 billion dollar of infrastructure investment needs I'm not really sure whether that includes trade finance part or not know maybe actually trade finance come on even on top of that now if you try to mobilize 28 billion dollars in one goal okay even you try you know you cannot really achieve that you know uh you you know basically try to work for work out that framework you know you're going to make that particular task impossible you know just like you know people say you know if you want to travel 1,000 miles you got to start with the first step same thing if you want to mobilize 28 billion dollars plus we got to start working with the first project and you know why I emphasize This is because you know as we started working on so-called regional cooperation you know activities there is a you know I shouldn't say um there is a tendency that you know the people in that arena would like to come up with some framework first and then let us agree on some framework and then you know from there we're going to work on probably that approach won't work more Programmatics thing is something you know we said you know in the Asia develop bank you know said the car that you know 2 + x 11 minus x you know what it really means okay car you know you know it's participated by 11 countries but then as long as among 11 two countries agree to do something together within a broader framework or vision they should better to make things happen. You know there is no need for 11 countries to agree something to start. So you know that's why this you know 2 + x 11 - x principle of car would probably apply for the middle corridor development as well. But you know now you don't really have to think about the framework first. Okay.

[00:25:35]actually framework is broadly there you know this concept of middle of the go from there what I'd like to suggest is really as a matter of priority you know over next 12 months or even six months come up with a project we can work and then from there we learn about the mechanisms and what I'm saying is this is because the MCDF actually supported a and the Islamic Development Bank to carry out you know middle uh or you know the central Asia connectivity study for the past several years and on MCDF side you know actually we've been waiting for some project to come out from that study because we want to see something really to happen now in that context you know again you know talking about you know this pragmatism I also you would like you know the everybody to recognize the fact that you know actually even you know for the middle corridor there are so many quotequote regional cooperation initiatives already out there you know including you know car but then you know there are some initiatives outside of car I mean you know that's all fine but you know regional cooperation or connectivity you if we are to really work on the connectivity among the you know we really don't have to stick with one particular framework whatever works I mean like you know when we were working you know on car that you know the kasa 1000 really came out not really as part of car as such happy didn't come out as part of the car but then still you know those are very important part of you know development initiatives to link or connect this Central Asian countries together and I certainly hope that you know for middle uh corridor development similar thing will happen.

[00:27:43]Well, I can also talk about this pragmatism in the context of my personal experience in supporting the establishment of correct institute.

[00:27:54]Back in 2014 uh when I member countries were talking about the establishment of corak institute actually it seemed that you know that they cannot really agree on some of the basic principles or the agreement and people thought that you know that they have to have the agreement before they start institute.

[00:28:20]Um so there was a senior officials meeting in Kyu Kilgist uh in 2024 or 2014 August and that time. So you know as I was chairing one of the sessions at the senior officials meeting I asked the representatives of those countries hey guys would you like to keep debating this legal aspects forever then we may not really see the correct institute in the next decade or shall we just put this you know debate over the legal you know agreement aside but then start working on the program first and Then uh actually all the representatives senior officials represent countries said that you know ah actually we'd like to see the program start moving before we agree on the legal stuff. So and so in 2015 we basically started doing things in parallel keep debating on again the legal aspects but then launching the program. Um so the so if you look at you know karak institute history the it's interesting that you're going to find two uh inauguration one is you know the initial event before the official agreement because official agreement was signed you know adopted at the uh 2016 IC uh uh ministerial conference in Islamabad and so only after that country signed and then it took a year you know for the ratification and process but then all those years actual correct institute programs were happening and I do hope that you know the middle corridor development will also follow in a way similar way you know be pragmatic be practical do things what we can possibly do and by doing things you know we learn more and let me emphasize once again that you know MCDF will be there to support the efforts of our implementing partner uh organizations including the Islamic Development Bank and what MCDF can guarantee is a very fast approval of the proposals. You know we usually approve the projects in three months. Um now and then we also you know before the approval we share the proposals with all our international financial institution partners. of the information is shared regardless of which framework or regional corporation framework. Let me stop here. Thank you so much.

[00:30:59]>> Thank you. Thank you. Uh last but not least uh daddy please.

[00:31:04]>> Yes. Thank you. uh may uh uh I would from the trade finance point of view uh you know uh when it go to financing of corridor trade uh most likely will be uh supply chain financing to be provided by by banks and you know when it come to corridor trade is perceived as high risk by all commercial banks international was a most commercial international commercial bank were involved in supply chain you how they live they behave because they see uh uh some depending on stability but different jurisdiction different mode of documentation and and also uh stability of the logistic on on the way from what they call it let's say in the middle corridor from from China go up to Turkey right so uh any perception of risk perception of risk right back appetite or quite uh you know risk very so the appetite is is less but nevertheless uh we need to create make things happen okay that's where the role of multilateral uh we don't wait for thing to be there to work so we need to create the uh the environment to bring uh people uh to other bank to join so this is our role I would say as multilateral so I'll give you my my own example you know we talk about I also like like my colleague said he I think I also do a 30 years experience in trade finance. So from uh Asia to Africa so I have a lot of experience for example in Africa where we do uh uh export cotton supply chain finance from production until export to support Southeast Asia from production fertilizer financing up to begin getting paid from export. So this goes into production multimodel transport by rail truck to the port from west Africa to a port then put on ship and send. So this is this is the model of of corridor I would say if world lend and see corridor and and and we've been through that we know the challenges we have to face but being a multilateral when we put our ourself in into the business we mobilize fun from other bank to tell hey I can do it would you like to join me so how this is how we do the job somebody have to make the first move right and multilateral is ready to most of the time to take a risk that a commercial bank don't want to take because commercial bank look at are pure risk and risk and return okay we look at the development aspect not just the risk and return so ITFC and can can play that role we also multilateral where we can uh bring the necessary risk mitigation in place including all the tools financing but also insurance payment guarantee ADB can provide for example they do that can work together to create a risk mitigated environment that can help to mobilize friend from OA bank to put in in transaction on the in the corridor development and there and also channel it most maybe through local bank in the countries involved so that we get prepared for for for financing uh the the medium corridor trade but again It it also therefore depend on on on how this the project on the on the structure is going and also don't forget the soft component I mentioned earlier uh harmonization standardization of document this is crucial in making the trade also efficient all right and that make this type of initiative that make commercial bank also become comfortable to to to to come into the business in the region so so yes There are risks.

[00:35:08]There are risk because of jurisdiction but also documentation but we can overcome it when we put our hand together. Thank you.

[00:35:15]>> Thank you so much. Now colleagues uh join me in giving a round of applause for the for the panel before we I turn to you to ask questions.

[00:35:28]So now the the floor is open if you have a question or a comment uh an experience that you want to share in line with the discussion. Anybody from the floor?

[00:35:44]I guess at the back. Um, somebody share a microphone.

[00:36:21]Thank you very much and good morning. Uh my name is Omar Davis, uh country operations manager in East Africa for the Islamic Development Bank. Uh my question uh is not uh so tied to this uh regional corridor but it's in reference to uh this issue of fuel uh price uh instability and our member countries are asking us uh regarding our participation in helping them to control this fuel.

[00:36:51]fuel comes in for example in the port uh let's use uh Djibouti as an example fuel will come in and then they distribute this fuel out to the different neighboring countries the landlock countries Ethiopia and others uh and they've asked us to help them with this uh it's not necessarily linked to transport but it's linked to this logistics around uh commodities around food and other things fuel and other things just wanted to know your thoughts on this as uh how can we help to support uh our member countries our landlocked member countries with uh these type of uh commodities bringing them the logistics bringing them into the port and of course moving them into the uh inner lands. Thank you very much.

[00:37:40]>> Thank you Omar. Uh any other question before I turn to the panel or any comment?

[00:37:47]Okay.

[00:37:49]Yes.

[00:37:49]>> Uh thank you uh uh Omar I think Omar Davis right >> so I think it's very pertinent uh question right now when it come to fuel because any economy cannot run if there's no adequate consistent continuous supply of of uh energy product to the country. So we we know that we finance about in our portfolio about 60% of our portfolio made of of of energy uh sector uh financing. So uh what you see in Africa is not only limited to Africa but you talk about Djibouti as a gateway to landlock countries like uh uh Ethiopia mostly but you have the same case in West Africa and in central Asia and currently the the problem is that from taking to consideration recent geopolitical t political situation in the region supply has been uh limited and and price has gone up very fast and countries cannot politically speaking cannot or will not want to increase their price immediately. They want to therefore absorb the shock and that create more requirement for financing because the price has gone up very high and they want to absorb it which will create pressure on their budget on the financing requirement and at the end on the depth level of the country to the GDP now not only that we have also the issue of sanction coming up on some countries for example in central Asia their main source of supply of of of energy product is from the Russian Federation right and today when and they have no other choice I mean where would they buy uh they can't buy from even from the Gulf or from other it has to come viable to come from there however when we want to finance them bank refuse to make payment because they say Russia is under section they refuse to to the payment to go to the concern entity that is supplying it. And this is another problem we are facing not just the the the the question of supply also payment and more and more and the sanction is evolving. So what we see last week something else it been added all the time. So it becoming a nightmare for compliance people in the in our in the bank in order to to to to tackle it. So this is what you're saying there in this week we met a lot of member countries that are talking about the same issue and and it create a a real problem in that price goes up more financing fiscal imbalance as well as uh debt uh the level of debt is increasing.

[00:40:48]>> Thank you very much. Uh just uh yes Thank you. Thank you. May uh field I'm an ex IDB staff and uh but working now as a consultant with bada bad the Arab bank for economic development in Africa and my question to Mr. Raomi said that from your uh finance arm that Africa is really I mean using maybe the bulk of your financing and uh uh as we are in your concern with the regional integration in Africa and also the uh transport corridors in Africa. I would like just maybe to to know if you can make some sort of comparison between the challenges that uh this middle corridor facing as compared to the from your experience with the challenges that might be facing the uh trade and transport corridors in Africa. Thank you so much.

[00:42:13]>> Thank you very much. You know interesting question um the I have to say my personal knowledge on Africa is a bit limited even though in my younger days I stationed in Adis you know at one stage in my life I was a staff of the economic commission for Africa. Um but of course you know since that time I know that Africa has developed so much and you know there are many emerging uh investment needs. Um I at this you know more and more I study about Africa I realize that you know there are many interesting project ideas but then they are halfbaked half developed not really pursued partly because of the shortage uh of resource financial resources to develop the upstream development projects. You know there are many facilities actually to facilitate the initial step to think you know come up with the ideas but then there is a missing sort of middle to develop such ideas into the you know let's say bankable project proposals as such um you know I'm really you know as I mentioned in my area presentation I'm one of those who strongly believe that you know the in in infrastructure financing gap so-called it's not really an issue of finance but it's really an issue of how to make sure that we work together to develop good ideas into quote quote bankable project proposals in the process you know if there are people from private sector I'm sorry to say this but then in my life I learned that you know private sector tends to be very risk averse and you know basically as we try to promote private sector investment into projects either through the PPPs or non-s sovereign project we really have make to make sure or make a very clear case to the private sector that you know okay this particular investment opportunity is likely to be very profitable without that you know private sectors you know usually don't really come in so you know comparing that in the center in the middle corridor situation and Africa situation I should say that you know what I at least I've been seeing in Africa there are already many more project ideas which are sort of you know the halfbaked or you know okay seeds are there but then not really properly planted and then being sort of watered is I think you know I feel that situation in Africa but I certainly would like to learn more from you. Thank you so much.

[00:45:18]>> Thank you.

[00:45:20]>> Yeah, I just want to add uh since it's a very interesting question and also including the earlier question raised by our operational uh head in Africa. I came here uh from uh Africa. This trip I traveled from Ageria to um Baku. Aeria is a country just I just want to use it.

[00:45:42]This example has not engaged multinational development bank for many years but now they are very keen they actually here the finance minister uh is in this uh ISDB um annual meeting so we are working with African development bank to develop a corridor north south in Algeria the total investments 2.5 billion in addition to that we We are actually developing more uh connectivity in the country uh because that's a critical to connect the Africa continent uh because their own uh target it's uh more than double the railway lines they already have about 6,000 kilometer railway lines they want to expand. So uh I discuss with the um min of uh trans uh finance people public works transport etc. then we decided to talk to ISDB because this is ISDB annual meeting. I just want to highlight that good sombo is actually happening in in Africa. ISDB has a great role to play. Thank you.

[00:47:01]Thank you very much and uh thank you for an excellent panel for all the points uh uh raised and uh shared today very insightful. uh we I think there are key takeaways for us but one important one is about partnership and the importance of coming together in in the different countries that we have uh providing our innovative and different instruments be it for the public sector be through trade finance with the private sector PPP and as well as having uh MCDF helping with uh preparing bankable projects. Uh thank you very much. That was a very uh I think informative and fruitful discussion and I would like to have a a final round of applause for the panel and then I hand over to Shahara.

[00:47:48]>> Thank you very much uh for the excellent session and uh before I move uh to the closing uh side is there if there is anybody else would like to raise any question just wanted to make sure that we still have a bit of time. So if there's Oh, we have one more question.

[00:48:04]If we can take one.

[00:48:13]>> Good morning everyone. My name is Mariam. I work for a global fund on digital transformation and I want to ask uh from your opinions in general, what are the impacts of digitalization in the context of middle corridor on transport and trade spec specifically on this middle range where there's a lot of crossber uh cooperation. Thank you.

[00:48:38]Let me go first you know uh okay now from MCDs perspective you know for us you know the we basically prioritize four sectors you know transport including trade facilitation uh trade development that's one you know energy sector and then transboundary water resources management but then post is digital digital connectivity and actually you know digital Well, I always feel a bit strange to talk about digital as a sector because it's a sector at the same time it's crosscutting that you know as we talk about developing any sector energy sector connectivity you know transport connectivity I mean all these things got to go with digital in today's context so I have to say you know digital development in you know the development of uh middle coral development is essential you know and I certainly appreciate that in terms of the fiber cable connectivity you know internet speed in this part of the world okay there are some issues still need to be addressed is what it is and again let me repeat once again that you know MCDF is more than happy to work with institutions like you know Islamic Development Bank AIB to really help address such issues. Thank you so much.

[00:50:02]Actually I I've been in Changdu, China last week to attend the APEC meeting where the AIB actually organized one the seminar on the digital infrastructure digital public infrastructure DI and DPI for one of the session I moderate myself with attendance of various stakeholders.

[00:50:21]So ADB side we have we are very keen in the supporting digital transformation in the context of uh middle corridor. I think the acceleration digital transformation is quite crucial very crucial to streamline custom procedures and to ensure the inter interoperable transit system across the different uh borders. Uh at the same time um from our side ADP I can share with you uh latest development from our side two initiative. First one is the so-called correct advanced transit system which is the usual interface where uh all the stakers including the guaranters and the customs officials and the trade operators can interact with with each other to exchange information in real time. Another initiative from our side is uh to support current member countries uh so-called IC information common exchange which is centralized the digital platform uh where the transit messages can be exchanged among the uh departure transit and destination countries. So this kind of the digital transformation will be quite crucial to streamline border procedures, hammers and customs procedures and uh to support advanced ruling, advanced declaration, e declaration because the fragmented paper uh process will not uh will fall short of unlocking the full potential of the middle corridor going forward. So that's my the key takeaways.

[00:51:47]>> Uh let me also add I think this issue will come up. So uh for example the logistic platforms in middle corridor currently I just give you a few uh several examples the digital freight marketplaces cargo visibility platform supply chain uh management systems intermodel booking platforms I asked this question in my meeting over this week to all the parties I'm meeting and my understanding is uh they are considering it but the the whole middle corridor is uh still in a very early stage when it comes to uh customer modernization, border management systems, corridor wide data platforms. Uh but countries are very very committed. They are working on that. So for digital platforms it will be very important to help both public and private sector to play a role. It cannot be solely private sector. It might be very very difficult to start with because many digital platforms if you just rely on a user fees it might not be enough to pay the digital infrastructure which is very very expensive because we need to have the foundational uh digital infrastructure to be able to uh operate and then build the the confidence of of uh shippers and to especially uh the really the key uh end goal the KPI is to reduce the transit time end to end. Thank you.

[00:53:39]>> Thank you. Thank you very much uh for the excellent uh or you know answering the questions. Once again a round of applause for all the panelists over here.

[00:53:51]And now I would like to call uh Mr. Dr. Hussein Muggable who is the manager for economic infrastructure at the Islamic Development Bank uh for the closing remarks and I would still like to the panelists to be keep seated because we'll have a photograph just after the closing session. Thank you very much.

[00:54:15]>> Uh thank you Shaher. Thank you may thank you for all the panelists. I would like also to thank the ministry of digital transformation and the transport for hosting and supporting the organization of this side events of ISTDB.

[00:54:32]It's very rich discussion and I think we have uh different uh the topic discuss the topic from different angles which is very uh fruitful and uh we have we are lucky to have this mix of the panelists. Thank you so much. It's it's very clear that uh with the efforts made so far the medical door is is is delivering and there is uh flight volumes has have been uh grown substantially in recent years.

[00:55:05]Uh transit time have been reduced and containers traffic is surging. However, with this real achievement that every every contributor to this should be proud of, still there is high potential to address the challenges as mentioned in uh during the discussion. There are some bottlenecks still remain physical, detail, financial, uh, investment and across the discussion that has been highlighted. One of the most important topics that has been addressed also related to the upstream part which is having bankable projects preparation. We have the inputs from the MCDF and uh also the the the other panelist preparation of physibility studies addressing the issues of capacity buildings.

[00:56:07]Uh and this is related also to the private sector appetite to contribute because without having bankable projects ready studies there will be some uh issues with the uh private sector uh involvement.

[00:56:26]uh such regional and corridor projects usually needs huge investment and and this is also uh new financing modalities as discussed by colleagues needs to be developed. In addition all MDBs cannot cover the needs and and private sector is is is important. New financing mechanism and modalities needs to be developed and also most importantly effective regional coordination mechanism uh are essential between different stakeholders that needs to be involved.

[00:57:09]Uh in today discussion uh there are come critical rules. The partnership coordination is important as highlighted by our esteemed panelist and and there is a role that everybody can play in strengthening the cooperation including MDB uh which has the networking advantage and and try to they can uh coordinate with the governments and other private sectors and and so on. So harmonizing the role and playing the coordination role by MDBs. We are here different entities even in the panelists. We have the investment bank AIB, you have the development banks, ISTDB, ADB and we have the preparations tool for projects MCDF. We have trade finance. So developing a working group with different players, different entities that have different mandates could play a very substantial role in coordinating efforts to uh move this uh dialogue into very clear action plan.

[00:58:21]And this is the the the next step we are looking for after having this dialogue is to think about what's the concrete programs concrete action plan that we could have after uh this dialogue. Thank you very much again and looking forward to uh next steps after this discussion.

[00:58:40]Thank you.

[00:58:45]>> Thank you very much Mr. Hussein Mabel.

[00:58:47]Please, please remain on stage. Uh, Bad Hussein and if you can have a group photo, can you please come on the stage? Yes.

[00:58:54]Thank you.

[00:59:22]Thank you.