ICIEC Supports $626 Million Lagos‑Calabar Coastal Highway Project to Enhance Connectivity and Development in Nigeria (IsDB 2026)

– Labelled Sukuk positioned as the next frontier for sustainable finance in MSs
The Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), a Shariah‑based multilateral credit and political risk insurer and member of the Islamic Development Bank Group (IsDB), has announced its support for the financing of the Lagos–Calabar Coastal Highway‑Phase II in Nigeria. The insurer is committing a total insured amount of USD 626 million to one of the country’s most strategically significant transport infrastructure projects.

The agreement was signed on the sidelines of the Islamic Development Bank (IsDB) Group 2026 Annual Meetings in Baku, Azerbaijan. The transaction is backed by ICIEC’s Non‑Honouring of Sovereign Financial Obligations (NHSFO) insurance policy, structured in favour of First Abu Dhabi Bank as the policyholder, with the Federal Ministry of Finance of Nigeria acting as the borrower. The policy, according to ICIEC, provides 95 percent coverage across two tranches: USD 276 million with a 7‑year tenor, and USD 350 million with a 9‑year tenor.

By mitigating sovereign risk, ICIEC stated its participation plays a critical role in facilitating access to long‑term international financing and ensuring the successful implementation of this landmark infrastructure project. The Lagos–Calabar Coastal Highway Project is a key component of Nigeria’s broader infrastructure development agenda under President Bola Tinubu’s government.

“Upon completion, the project will significantly enhance regional integration and mobility, enabling more efficient movement of goods and people across the country’s coastal regions, thereby catalysing economic activity, reducing logistics costs, and strengthening supply chains,” the agency said.

The Chief Executive Officer of ICIEC, Dr. Khalid Khalafalla, in his remarks during the ceremony yesterday, said: “Through this transaction, ICIEC is demonstrating the practical value of Shariah‑compliant risk mitigation in advancing large‑scale development projects.”

“Our support helps bolster lender confidence, mobilise long‑term financing, and enable Nigeria to move forward with this strategic infrastructure investment that will strengthen connectivity and support socioeconomic progress.”

Meanwhile, senior policymakers, global financial sector leaders, capital market experts, development institutions, and Sukuk market participants at a forum tagged “Labelled Sukuk – The Next Frontier” concluded deliberations on how labelled Sukuk can support sustainable development priorities for member states, including Nigeria, while expanding the reach of Islamic finance through global capital markets.

The high‑profile event was organised on the sidelines of the ongoing 2026 Islamic Development Bank (IsDB) Group Annual Meetings in Baku with the theme “Regional Integration for Sustainable Prosperity.” It was reported that in 2025 the labelled Sukuk market surpassed US$20 billion, representing a 38 percent year‑on‑year growth (S&P).

“While this accounted for less than 10 percent of all Sukuk issued last year, the natural alignment between Islamic finance principles and the different labels that are geared towards positive impact and sustainability is a sign for the labelled Sukuk market to grow at a faster pace than ever before,” the forum stated.

At the event, particular attention was given to the growing need for innovative financing solutions to address global climate challenges and the significant funding requirements associated with achieving the Sustainable Development Goals.

In his opening speech, the Officer in Charge, Vice President Finance and Chief Financial Officer of IsDB, Dr. Abdourabbih Abdouss, emphasised that Sukuk remains the primary Islamic capital‑market instrument for mobilising development resources, “while labelled Sukuk are creating new opportunities for investors to support specific sustainability and development priorities in line with Islamic finance principles as well as global sustainability standards.”

Also, the Minister of Planning and Economic Development and IsDB Governor for the Arab Republic of Egypt, Dr. Ahmed Rostom, noted the asset‑based nature and structure of Sukuk instruments provide investors with greater visibility into the use of proceeds of the assets underpinning their investments, reinforcing the principles of transparency and financing real economic activities.

In the keynote address, the Deputy Governor of Bank Negara Malaysia, Adnan Zaylani Mohamed Zahid, highlighted the growing importance of labelled Sukuk in supporting sustainable development objectives and strengthening the role of Islamic finance in addressing global economic, social, and environmental challenges.

The high‑level panelists at the forum examined opportunities and challenges associated with expanding the labelled Sukuk market, including regulatory frameworks, cross‑ministerial coordination, issuer readiness, market awareness, reporting standards, and the development of sustainable finance ecosystems capable of supporting future growth. The forum further showcased IsDB’s experience as a frequent Sukuk issuer and its leadership in advancing Green and Sustainability Sukuk under its Sustainable Finance Framework.

Some other speakers highlighted examples of how Islamic finance instruments can support tangible development outcomes, including regional infrastructure corridors, energy interconnections, and climate resilience initiatives in member states.

The event concluded with a call for stronger collaboration among governments, development institutions, regulators, market participants, and other stakeholders in member states to expand the labelled Sukuk market and enhance its contribution to the sustainable development objectives of MSs.