The global sukuk market has been witnessing strong growth amid rising investor appetite and as more issuers seek refinancing and diversify their funding sources. Estimates by Malaysia International Islamic Financial Market (MIFC) show that sukuk issuance globally reached US$174.6 billion in 2020, an increase of 19.84% over the previous year. Despite the disruptions brought on by Covid-19, the upward trend is expected to continue as corporates and sovereigns take advantage of the low interest rate environment and investors hunt for yield.
The pandemic, in fact, has opened more opportunities as the industry’s dynamics shift towards sustainable and responsible investing. Moves to standardize global legal and regulatory frameworks are taking place and innovative social and green instruments have popped up over the past 12 months.
Also, there has been strong interest among countries making efforts to implement the United Nations’ Sustainable Development Goals (SDGs). Many issuers have incorporated environmental and social considerations into their framework, and variants of green sukuk (SDG, sustainability and blue) have begun to appear in the market. All this promises a more dynamic and flourishing sukuk market.
Furthermore, increased digitalization and fintech collaboration by Islamic banks using sukuk could help strengthen issuer resilience in more volatile environments and open new avenues for growth.
The Asset Events+ is pleased to be organizing the 4th Islamic Finance Issuers and Investors Leadership Dialogue. This virtual webinar series brings together industry experts and key players for in-depth discussion on the trends in the market and key issues facing Islamic finance, all with a focus on the road ahead.