The Arab Monetary Fund (AMF) approves five new loans to Arab countries in 2021, with approximately Arab Accounting Dinar (AAD) 148 million, equivalent to about US$623 million, to meet emergency financing needs and support economic and financial reform efforts.
Conducting 52 training courses for Arab official cadres in 2021, benefiting 1,521 participants
Organizing meetings of governors of central banks and Arab monetary authorities, deputy governors and undersecretaries of finance ministries
Organizing meetings of Arab committees and task forces in various fields, with the aim of exchanging experiences during the recovery phase of the repercussions of the Covid-19 pandemic, and returning to the normal tracks of economic growth
Issuing 82 publications in 2021, including reports, working papers, research studies, statistical bulletins, books, booklets, and policy guidelines, including 28 publications related to the development of the financial and banking sector as well as digital financial transformation, and financial stability in the Arab countries
Completion of the establishment and operation of "Buna" platform for Arab cross borders payments and the inclusion of major Arab and international currencies
The Arab Monetary Fund (AMF) launched its annual report on its activities in 2021, endorsed by its Council of Governors after briefing about the Fund's efforts to provide financial and technical support to promote economic and financial stability and achieve inclusive and sustainable growth in its member countries.
The report includes the Fund's activity and financial position for the fiscal year ended December 31st, 2021, highlighting its financial and technical support to member countries through lending activities, direct and indirect technical support and advice, and its contributions to publications such as studies, reports, and booklets, in the economic, financial, monetary and statistical fields, as well as its activities to build and develop the capacity of Arab officials in central banks and ministries of finance, economy and trade, and national statistical bureaus, through seminars, workshops and training courses organized by the Fund.
The report also highlighted the Fund's efforts to support its member countries during 2021 in face of the repercussions of the Covid-19 pandemic, and during the recovery phase, as the Fund continued during the mentioned year to implement simplified and rapid lending procedures to support economic, financial and banking reform programs and address balance of payments imbalances, as well as providing technical support and advice and training, focusing on policy issues related to inclusive and sustainable development. The report also included the Fund's activities aimed at increasing levels of financial inclusion, supporting the efforts of regulatory authorities in Arab countries to develop the financial sector, and maximizing the opportunities offered by financial technologies to increase the efficiency of financial services and access to finance.
In this context, the Fund’s Council of Governors was briefed on the efforts in the context of lending activity during 2021, considering its strategic objectives, and its plans and activities designed to achieve them, considering the exceptional circumstances caused by the Covid-19 pandemic. The Fund agreed during the mentioned year to provide five loans with a total value of about AAD 148 million, equivalent to about US$ 623 million, to support balance of payments and reform programs in various economic sectors. The Fund also agreed to release tranches of previously contracted loans based on the progress of the implementation of the reform programs supported by those loans, with total withdrawals amounting to approximately AAD 95.925 million, about US$ 403.7 million.
The Council was also briefed on the Fund's ongoing efforts to support and assist decision makers and economic policymakers in the Arab countries during 2021 through issuance of 82 specialized publications, including reports, working papers, research studies, books and guidelines. The publications included 28 issuances on topics related to the development of the financial and banking sector, as well as financial stability in the Arab countries. The publications also included 19 introductory booklets aimed at raising the economic and financial awareness of Arab youth.
The Council was also briefed on the Fund's efforts in implementing its training program and activities, aimed at strengthening the capacity of human resources working in official institutions in member countries, where 52 training courses were held, benefiting some 1521 participants from Arab official cadres.
Regarding the development of the financial and banking sector in the Arab countries, the report reviewed the Fund's activities, which focused on strengthening the financial stability in the Arab countries, providing opportunities for sharing experiences and knowledge transfer, in dealing with the challenges posed by the Covid-19 pandemic to the sector, where the Fund intensified its consultations with policy makers in member countries on the repercussions of the pandemic. The Fund also produced several guidelines and reference papers aimed at enhancing knowledge of financial stability issues and supporting digital financial transformation in Arab countries.
With respect to the Council of Governors of Central Banks and Arab Monetary Institutions and the Council of Arab Finance Ministers, the Fund’s Council of Governors was briefed on the Fund's efforts during 2021 to strengthen its pivotal role as a platform for dialogue and consultation among policy makers in member countries on the economic and financial implications and exchange experiences on appropriate policies. In this regard, the Fund organized in 2021 meetings of the two Councils and the committees and task forces emanating from them, as well as several workshops and dialogue forums organized with the participation of many regional and international financial institutions. On a related note, the Fund organized several high-level meetings of governors, deputy governors and undersecretaries of finance ministries in Arab countries.
Among the achievements addressed in the Fund’s annual report, the Fund’s efforts in the context of operating “Buna” platform for facilitating cross-border Arab payments, including the signing of the agreement whereby the United Arab Emirates hosts Buna’s headquarters, the issuance of the federal decree ratifying the agreement, the preparation of the framework of compliance policy, the completion of implementing a technical system to verify compliance, the acquisition of softwares necessary for this system, the developments in the system made by the technical team of the platform to serve the needs of participating banks, the completion of the procedures to include the U.S. dollar and start providing clearing and settlement services in the mentioned currency, hence making the platform the first regional payment platform in the world that provides clearing and settlement services in US dollar, in addition to completing the procedures of including the euro and starting to provide clearing and settlement services in euro.
The Council also discussed the developments of the Fund’s investment activity in 2021, where the Fund continued to implement conservative investment policy and strategy in managing funds and risks of its investment portfolios. This conservative approach contributed to safeguard invested capital and helped the Fund continue achieving positive returns. The Fund’s investment activity includes managing investments of its own resources and those of deposits from member countries that it accepts, while maintaining high level of reserves for this activity, in addition to continue implementing Basel 3 regulations pertaining to managing investment risks. The Fund also continued managing directly investments of part of the funds of the Arab Trade Financing Program, resources of the Fund for Arab Specialized Organizations, as well as monitoring its externally managed funds as per respective investment policies and strategies of each fund.
Regarding the Fund's contributions to the development of Arab trade and the strengthening of the competitiveness of Arab exports, the Fund continued during 2021, through the Arab Trade Financing Program, to provide information and promote Arab goods, while providing some of the necessary financing for Arab trade. The value of trade transactions financed by the Program during 2021 amounted to US$ 1,403 million, and the value of disbursements during the mentioned year amounted to US$ 1,012 million. The report also included the Fund's activities to support opportunities for Arab economic integration and to facilitate Arab payments and links with the major trading partners of Arab countries, through both the Arab Trade Financing Program that aims at encouraging Arab trade flows, and the Arab Regional Payments Clearing and Settlement Organization "Buna".
The full version of the report is available on the Fund's website