Qatar has been among the most active issuers of sukuk, or Islamic bonds, with the last year’s sovereign issuance attracting the attention of global investors, especially Asian, according to a top official of the Qatar Financial Center (QFC).
Highlighting that conventional bonds and sukuk have huge potential to support the social and physical infrastructure needs across the Middle East, QFC Authority chief economic adviser Dr Haitham al-Salama said establishing a robust market infrastructure to support sukuk issuance would be key in making the market more globally accessible.
Addressing the ‘Bonds, Loans and Sukuks Middle East’, one of the region’s largest finance and investment conferences, he said there is a tremendous potential in the sukuk market and as the demographics improve in the Muslim world, sukuk market would evolve and develop.
Emphasising the importance of the growing sukuk market, al-Salam said “more countries are integrating sukuk into their tax codes, especially as the success of sukuk and Islamic finance becomes more apparent.”
Sukuk as a niche product delivers a more stable return compared to regular bonds, he said, adding increasing investor demand made countries to work on the integration of sukuk into their regulations including tax regimes.
The QFC economist had earlier said Islamic finance would need to play a pivotal role in meeting the increasing demand for funds by the Gulf Cooperation Council governments, especially at a time of new oil order, where prices are expected to be in the range of $55 to $60 a barrel.
The sukuk conference saw more than 900 delegates discuss the region’s financial and economic development. It brought Asian investors together with Turkish, Russian, Middle Eastern and African debt issuers, and served as a unique opportunity to conduct multiple non-deal roadshow-style meetings with investors and for issuers to meet a large number of investors in one place at one time.