The Theory and Practice of Profit Sharing Investment
Foundations of Islamic Finance series
Edited by Mohamed Ariff, Munawar Iqbal and Shamsher Mohamad
Chapter 9: Stylized Facts About Islamic Sukuk Markets
Nasser H. Saidi 9.1 STYLIZED FACTS ABOUT ISLAMIC FINANCE AND THE SUKUK MARKET The global market for Islamic financial services, as measured by shari’ahcompliant assets, is estimated by IFSL to have reached US$951 billion at end-2008, 25 per cent up from US$758 billion in 2007 and three-quarters up on the 2006 total (with dividends ranging between 15 per cent and 20 per cent in 2008). By end-2010 it was observed that total shari’ah-compliant assets are closer to US$1 trillion, although, like all financial markets, the sukuk market growth declined slightly in the years 2009 and 2010. By the middle of 2011, the market is showing signs of faster growth again. To put this in perspective, if we stack one-dollar bills vertically, one trillion is equivalent to the distance to the moon! However, this represents less than 1 per cent of global total financial assets denoted as conventional bonds, although the GDP share of Muslim-majority countries is variously estimated to be about 13 per cent of the world GDP. There is room for growth in this market. Demographic statistics suggest that Muslims constitute 22 per cent of the world population. According to data from Standard & Poor’s, new sukuk issuance in 2009 increased to US$23.3 billion compared to US$14.9 billion in 2008. However, the listed ones are only a small fraction of total sukuk issuances – at the end of 2009, the total public listed on some of the main exchanges was roughly around US$54 billion only:...
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