EBRD boosts Palestinian trade with $10m facility for Arab Islamic Bank

The European Bank for Reconstruction and Development has increased its trade finance facility to Arab Islamic Bank by an additional $5 million, bringing the total limit to $10 million to support Palestinian import and export activity.

The expanded financing, provided under the EBRD’s Trade Facilitation Programme (TFP), aims to enhance trade flows between the West Bank and international markets at a time when access to global banking services remains constrained.

“The expanded limit to AIB will facilitate further trade flows between the West Bank and international markets, enabling the issuance of trade finance instruments,” the EBRD said in a statement, highlighting the bank’s role in supporting the resilience of the local financial sector.

AIB joined the TFP in 2023 with an initial limit of $2 million, which has since been increased twice in response to the bank’s growing trade finance activity. The facility has been used to support several transactions, including the import of essential goods such as food and medical equipment.

AIB is the largest Islamic bank operating in the West Bank and Gaza and is a subsidiary of Bank of Palestine, an EBRD client since 2020. Through the programme, AIB has gained access to a global network of more than 100 issuing banks and over 800 confirming banks. Its staff have also participated in EBRD-led training and workshops on trade finance best practices.

Launched in 1999, the EBRD’s Trade Facilitation Programme supports international trade by providing guarantees and short-term financing to participating banks and factoring companies, enabling them to extend funding to local exporters, importers and distributors.

Since commencing operations in the West Bank and Gaza in 2017, the EBRD has approved 38 projects with a total investment volume of €196.5 million, underscoring its ongoing commitment to strengthening the Palestinian financial sector and facilitating economic activity.