Courses : Intermediate Macroeconomics Lecturer : Frischa Adellia Semester : 4th Semester, 2022/2023 Sesion Islamic Development Bank (IDB) The Islamic Development Bank (IDB) is an international financial institution founded in 1975. The IDB is headquartered in Jeddah, Saudi Arabia, and has 57 member countries, most of them in the Muslim world. IDB's main goal is to promote economic and social development in member countries through the financing of development projects that comply with the principles of Islamic economics. As a financial institution based on sharia principles, IDB pays attention to moral and ethical aspects in all of its investment activities. Therefore, IDB only finances projects that are in accordance with Islamic principles, such as the prohibition of usury (interest), speculation, and investment in industries that are considered detrimental to society. To achieve its goals, IDB offers a variety of financial products, such as loans, project financing, equity investments, and non-financial products, such as technical consulting and training. IDB also provides technical assistance and humanitarian assistance in emergency situations. IDB has several main programs and initiatives, including: 1. Development Financing Program: IDB provides loans and finances development projects in various sectors, such as infrastructure, energy, agriculture, education, and health. 2. Trade Finance Program: IDB provides trade finance to support trade between member countries, including export and import financing, service activity financing, and trade infrastructure financing. 3. Technical Assistance Program: IDB provides technical assistance in a variety of areas, including Islamic finance sector development, human capacity building, and technology development. 4. Humanitarian Programs: IDB provides humanitarian assistance in emergency situations, such as natural disasters, conflicts, and pandemics. This program includes the provision of food, clean water, medical equipment and health services. In carrying out its activities, IDB cooperates with various international and regional organizations, including the United Nations, the World Bank, and the African Union. As an international financial institution based on Islamic economic principles, IDB plays an important role in promoting sustainable development in Muslim and non-Muslim countries that fulfills Islamic economic principles. 1. IDB function The function of the IDB is to provide loans for productive projects in economic and social development. In addition, IDB also establishes and operates special funds for specific purposes such as relief funds for Muslim communities in non-IDB member countries and is authorized to receive funds and mobilize these funds based on compatible Islamic financial resources. It is also charged with the responsibility of assisting in the promotion of foreign trade, especially in capital goods among member countries, namely providing technical assistance to member countries and expanding training facilities for personnel involved in development activities in Muslim countries to adapt yourself with sharia. 2. IDB Destinations To encourage economic development and social progress in member countries and Muslim communities both individually and collectively in accordance with sharia principles, namely Islamic law. 3. IDB Vision and Mission In order to achieve its goals, IDB has a vision to become a leader in encouraging socioeconomic development in member countries and Muslim communities in non-member countries in accordance with sharia principles. In addition, IDB also has a mission to reduce poverty, support human development, science and technology, Islamic economics, banking and finance and enhance cooperation between member countries through IDB's development partners. 4. IDB Membership and Principles of Operation a) member country Currently IDB membership consists of 56 countries, the basic terms and conditions for membership is that the prospective member country must be a member of the Organization of the Islamic Conference (OIC), pay a contribution to the bank's capital and be willing to accept the terms and conditions as may be decided by the IDB Board of Governors . Each member state is represented by a governor and an alternative governor, each member having 500 basic votes plus 1 vote for each subscribed share. In general, decisions are taken by the Board of Governors based on the majority of voting rights represented at the meeting. The Board of Governors meets once every year to review the Bank's activities for the previous year and to decide on future policies. b) operational principle o IDB becomes the caliph (pioneer) of development based on Islamic foundations o IDB is proactive o IDB always maintains relationships and seeks to enhance cooperation o IDB targets community needs and aspirations before compiling them into programs o IDB consults intensely with each stakeholder in each of the proposed programs c) Cooperation Focus o Human development o Agricultural development and food security o Infrastructure development o Trade cooperation between member countries o Private sector development o Study and development in the field of Islamic economics, banking and finance