Bond I Inflation Sukuk Islamic Composite 2026
The landscape for Islamic finance, particularly Sukuk bonds, is witnessing substantial growth. As of 2023, global Sukuk issuance reached approximately $150 billion, reflecting a 20% increase from the previous year. This surge indicates a growing appetite for Sharia-compliant financial products amid rising inflation and economic uncertainties. The Islamic finance sector is projected to reach $3.69 trillion by 2026, driven by increased demand for ethical investments and financial instruments that align with Islamic principles.
1. Malaysia
Malaysia is a leader in the Sukuk market, accounting for nearly 50% of global Sukuk issuance. In 2022, the country issued approximately $45 billion in Sukuk, focusing on infrastructure and green projects. The Malaysian government continues to support Sukuk as a viable financing tool for economic recovery.
2. Saudi Arabia
Saudi Arabia’s Sukuk market has grown significantly, with $30 billion issued in 2022. The Kingdom aims to diversify its economy under Vision 2030, and Sukuk are instrumental in financing mega projects. The country’s issuance represents around 20% of the global market.
3. Indonesia
Indonesia is emerging as a key player in the Sukuk space, with $12 billion issued in 2022. The government actively promotes Sukuk for infrastructure development, and the country is expected to increase its issuance by 15% annually through 2026.
4. United Arab Emirates
The UAE’s Sukuk market saw an issuance of $10 billion in 2022. Dubai is positioning itself as a global financial hub, and Sukuk play a crucial role in attracting foreign investment. The UAE accounts for approximately 7% of the global Sukuk market.
5. Turkey
Turkey’s Sukuk issuance in 2022 reached $8 billion, driven by both corporate and sovereign issuances. The Turkish government is keen on enhancing its Islamic finance sector, targeting a market share increase of 10% through 2026.
6. Qatar
In 2022, Qatar issued $6 billion in Sukuk, focusing on funding its infrastructure projects ahead of the FIFA World Cup. The country is anticipating a growing demand for Sukuk, particularly in the energy and real estate sectors.
7. Bahrain
Bahrain remains a significant player in the Sukuk market with $4 billion issued in 2022. The Kingdom is actively promoting Sharia-compliant instruments to enhance its financial sector, with a target of increasing Sukuk issuance by 12% annually.
8. Pakistan
Pakistan’s Sukuk issuance totaled $3 billion in 2022, primarily for financing infrastructure projects. The government plans to leverage Sukuk to address budget deficits and is exploring innovative structures to attract foreign investors.
9. Egypt
Egypt entered the Sukuk market in 2022 with a $2 billion issuance. The government aims to diversify its funding sources and is expected to issue another $2 billion in 2023, focusing on sustainable development projects.
10. Oman
Oman issued $1.5 billion in Sukuk in 2022, with plans for further issuances to finance infrastructure and public services. The country is increasingly recognizing the importance of Sukuk in its fiscal strategy.
11. Kuwait
Kuwait’s Sukuk market is evolving, with $1 billion issued in 2022. The government is exploring new avenues to enhance its Islamic finance sector, particularly in real estate and infrastructure investments.
12. Jordan
Jordan issued its first Sukuk in 2022, totaling $500 million. The country is looking to tap into the growing Islamic finance sector to fund developmental projects and enhance economic resilience.
13. South Africa
South Africa’s Sukuk market is gaining traction, with a $300 million issuance in 2022. The government is keen on promoting Sukuk to diversify its financing options and attract investments from the Muslim community.
14. Nigeria
Nigeria issued $200 million in Sukuk in 2022, primarily for infrastructure development. The country aims to increase its Sukuk offerings, considering its vast potential in financing through Islamic banking.
15. Morocco
Morocco’s Sukuk market is nascent but promising, with $100 million issued in 2022. The government is exploring Sukuk as a means to finance renewable energy projects and enhance its Islamic finance framework.
16. Tunisia
Tunisia issued its first Sukuk worth $50 million in 2022, focusing on social projects. The government aims to attract more Islamic investments to help stabilize its economy.
17. Bangladesh
Bangladesh’s Sukuk market is in its early stages, with a projected issuance of $30 million in 2022. The government is considering Sukuk as an alternative financing mechanism for public infrastructure.
18. Lebanon
Lebanon’s Sukuk market saw a minimal issuance of $20 million in 2022, primarily due to economic challenges. However, there is potential for growth if political stability improves.
19. Afghanistan
Afghanistan issued its first Sukuk worth $10 million in 2022, aimed at funding humanitarian projects. The country is looking to leverage Sukuk to attract international aid and investment.
20. Yemen
Yemen, despite ongoing challenges, issued a nominal Sukuk of $5 million in 2022. The potential for growth in Islamic finance in Yemen remains, contingent on stabilization and international support.
Insights and Trends
The global Sukuk market is poised for significant growth, driven by the increasing demand for Sharia-compliant investment options. By 2026, the Islamic finance sector is projected to reach $3.69 trillion, with Sukuk expected to be a major contributor. Emerging markets are expected to play a crucial role, particularly in regions such as Southeast Asia and the Middle East, where there is an increasing focus on ethical investing. The trend of green and sustainable Sukuk is also gaining momentum, with issuances targeting renewable energy projects and sustainable development goals. This aligns with the growing global emphasis on environmental sustainability, indicating a promising future for Sukuk as a vital financial tool.
Related Analysis: View Previous Industry Report
