THE PRIVATE SECTOR INTERVIEW
OPEC Fund Vice President, Private Sector, Tareq Alnassar on the sector’s role as the engine of growth, job creation and innovation, the first 25 years of private sector operations – and looking forward to the next 25 By Axel Reiserer, OPEC Fund DRIVING GROWTH AND DELIVERING SERVICES – WITH AND THROUGH THE MARKET
OPEC Fund Quarterly : Initially dedicated solely to public sector operations, at the turn of the century the OPEC Fund decided to add private sector and trade finance operations to its portfolio. Why? Tareq Alnassar: The OPEC Fund realized that to achieve its vision of creating a world where sustainable development is a reality for all, partner country governments cannot do this alone. To fill that gap, we wanted to create a new financing window for privately- or state-owned, yet commercially-run companies in partner countries, enabling the private sector to operate in areas where there were amplified economic and social development gains for the partner countries. The private sector is the engine of growth and job creation, so the OPEC Fund really had to open a dedicated financing window to complement its public sector o ff ering.
OFQ : How did our work with the private sector develop?
privately or state-owned, commercially- run entities. We o ff er a diverse array of financial products, including debt, equity, quasi-equity, risk sharing arrangements and Islamic finance products, making the OPEC Fund an attractive lender to clients. Financing solutions need to be adaptable and innovative to serve the private sector’s needs. We focus on sectors closely aligned with the OPEC Fund’s mandate and delivery of the Sustainable Development Goals (SDGs). This includes the financial sector, infrastructure and agribusiness, among others. The business landscape changes frequently and has changed substantially in the recent past with a rise in interest rates, soaring inflation and currency fluctuations. We have been working closely with our partners to navigate this dynamic landscape.
TA: The OPEC Fund’s private sector engagement has directly boosted the economies of more than 70 countries globally through its funding channels. We have committed over US$10 billion to over 600 transactions across multiple sectors and geographies. Since the start of our trade finance window in 2006, we have provided over 11,000 unfunded guarantees globally for over US$12 billion.
OFQ : Where do we want to go from here?
TA: The Private Sector Department is well-recognized and respected in the market. Now we would like to enhance our pipeline generation capabilities, i.e. structure our own real economy transactions, foster the OPEC Fund's catalytic impact by adding syndications to our o ff ering and further enhance our product o ff ering, for instance with local currency loans. With our recently established syndications function we aim to attract more partners to finance themes such as climate action [or adaptation and mitigation], micro, small and medium- sized enterprises (MSMEs), women-led or women-owned enterprises and food security.
In alignment with the OPEC Fund Food Security Action Plan, the Private Sector Department supported the agricultural and livestock business in Paraguay,
OFQ : What are the main characteristics of the Private Sector Department in your experience? TA: The Private
through one of our financial institution partners, Banco Sudameris.
Sector Department focuses on providing financing solutions to
Tareq Alnassar, Vice President, Private Sector, OPEC Fund
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