Bond Sustainability KPI Sukuk Islamic Targets 2026
The global Islamic finance market is experiencing significant growth, driven by an increasing demand for ethical investment options and sustainable financial instruments. As of 2023, the Islamic finance market was valued at approximately $3 trillion, with Sukuk (Islamic bonds) making up a substantial portion. The global Sukuk market is anticipated to reach $600 billion by 2026, with an increasing focus on sustainability and environmental, social, and governance (ESG) criteria. This report outlines the top 20 players in the Sukuk market, emphasizing their contributions to sustainability targets by 2026.
1. Malaysia
Malaysia is a global leader in the Sukuk market, accounting for approximately 60% of total global Sukuk issuances. In 2022, the country issued Sukuk worth $40 billion, demonstrating its commitment to sustainable financial frameworks.
2. Saudi Arabia
Saudi Arabia ranks as the second-largest issuer of Sukuk, with a market share of around 20%. In 2022, the Kingdom raised $15 billion through Sukuk, focusing on green projects aligned with its Vision 2030 sustainability goals.
3. Indonesia
Indonesia is rapidly emerging in the Sukuk landscape, with $12 billion issued in 2022. The Indonesian government aims to increase its Sukuk offerings to finance infrastructure and sustainable development projects significantly.
4. United Arab Emirates (UAE)
The UAE’s Sukuk market is robust, with total issuances reaching $10 billion in 2022. The Emirates is committed to promoting Islamic finance as a means of achieving sustainable economic growth.
5. Turkey
Turkey’s Sukuk market has grown to represent approximately 5% of the global market, with issuances totaling $5 billion in 2022. The country’s focus on sustainable urban development has driven demand for Sukuk financing.
6. Qatar
Qatar has issued Sukuk worth $4 billion in 2022, with an emphasis on funding renewable energy projects. The country aims to become a regional hub for sustainable finance by 2026.
7. Pakistan
Pakistan’s Sukuk market saw issuances of $3 billion in 2022, with the government introducing various green Sukuk initiatives to support environmental sustainability.
8. Bahrain
Bahrain issued $2 billion in Sukuk in 2022, focusing on sustainable infrastructure projects. The country is a key player in the Islamic finance sector, promoting sustainable investment solutions.
9. Egypt
Egypt’s Sukuk market is in its nascent stages, with issuances of approximately $1 billion in 2022. The government is exploring Sukuk as a tool for financing green projects and infrastructure development.
10. Oman
Oman’s Sukuk issuances reached $1 billion in 2022, with a focus on funding social development programs. The Sultanate is aiming to enhance its Islamic finance offerings by 2026.
11. Kuwait
Kuwait has issued $800 million in Sukuk in 2022, with a strong emphasis on sustainable investments. The country is expected to increase its focus on green financing initiatives.
12. Jordan
Jordan’s Sukuk market is growing, with a total issuance of $600 million in 2022. The country is exploring Sukuk as a viable financing option for sustainable development projects.
13. Bangladesh
Bangladesh issued Sukuk worth $500 million in 2022, focusing on renewable energy and infrastructure. The government aims to enhance its Sukuk framework to attract more sustainable investments.
14. Morocco
Morocco’s Sukuk market is developing, with issuances reaching $400 million in 2022. The government is promoting Islamic finance as a means of supporting social and economic development.
15. Tunisia
Tunisia issued $300 million in Sukuk in 2022, focusing on social development projects. The country aims to leverage Sukuk for enhancing its sustainable finance landscape.
16. Algeria
Algeria’s Sukuk market is emerging, with issuances of $200 million in 2022. The government is looking to enhance its Islamic finance sector to support sustainable economic growth.
17. Lebanon
Lebanon’s Sukuk market is small, with approximately $100 million issued in 2022. The country is exploring Sukuk as a financing mechanism for reconstruction and development projects.
18. Brunei
Brunei issued $50 million in Sukuk in 2022, focusing on developments in the education and healthcare sectors. The government is working towards sustainable financing options.
19. Maldives
The Maldives’ Sukuk market is minimal, with only $20 million issued in 2022. The country is beginning to explore the potential of Sukuk for financing sustainable tourism initiatives.
20. Sri Lanka
Sri Lanka issued $10 million in Sukuk in 2022, focusing on small-scale development projects. The government is interested in expanding its Sukuk offerings to attract more sustainable investments.
Insights
The Sukuk market is poised for significant growth, particularly in the realm of sustainability. As countries embrace green financing initiatives, the trend towards sustainable Sukuk is likely to intensify, with issuances expected to rise sharply by 2026. According to projections, the market could see a compound annual growth rate (CAGR) of over 15%. Furthermore, the integration of ESG principles into Sukuk offerings is becoming a pivotal factor for investors, reflecting a broader shift towards responsible investing. With global Sukuk issuances anticipated to approach $600 billion by 2026, this segment of Islamic finance is set to play a crucial role in supporting sustainable development goals worldwide.
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