Introduction
The global Islamic finance market has been witnessing significant growth, with the sukuk market playing a pivotal role in this expansion. As of 2022, the global sukuk issuance reached approximately $200 billion, showcasing a robust demand for Sharia-compliant investment vehicles. The trend towards mandatory equity sukuk and the forced conversion mechanisms, particularly in emerging markets, is gaining traction. By 2026, the integration of these instruments into mainstream finance is expected to enhance liquidity and broaden investor participation, further solidifying the position of sukuk in the financial ecosystem.
Top 20 Countries and Companies Involved in Bond Mandatory Equity Sukuk Islamic Forced Conversion 2026
1. Malaysia
Malaysia is a leader in the sukuk market, boasting nearly 50% of global sukuk issuance, valued at approximately $70 billion in 2021. The country’s robust regulatory framework has facilitated the growth of mandatory equity sukuk, attracting both local and international investors.
2. Saudi Arabia
Saudi Arabia’s sukuk market is one of the largest in the Gulf Cooperation Council (GCC), with issuances exceeding $40 billion in 2021. The government’s Vision 2030 initiative has spurred the development of innovative sukuk structures, including forced conversion mechanisms.
3. UAE
The United Arab Emirates accounts for about 30% of the GCC sukuk market, with total issuances reaching $27 billion in 2021. The Dubai Financial Market is actively promoting equity sukuk, enhancing the investment landscape for Sharia-compliant assets.
4. Indonesia
Indonesia has emerged as a key player in the sukuk market, with total issuances hitting $20 billion in 2021. The country’s efforts to diversify funding sources through mandatory equity sukuk are expected to attract more foreign investment.
5. Turkey
Turkey’s sukuk market is evolving, with issuances amounting to approximately $15 billion. The government’s support for Islamic finance is driving the development of innovative products, including forced conversion sukuk.
6. Qatar
Qatar’s sukuk market reached $10 billion in 2021, with a focus on developing mandatory equity sukuk to meet the growing demand for Sharia-compliant investments. The Qatar Financial Centre is fostering a conducive environment for sukuk innovation.
7. Bahrain
Bahrain is recognized for its strong Islamic banking sector, with sukuk issuances totaling approximately $5 billion. The country is positioning itself as a hub for mandatory equity sukuk, enhancing its competitive advantage in the region.
8. Pakistan
Pakistan’s sukuk market has seen increasing activity, with issuances reaching $4 billion in 2021. The government is exploring equity sukuk as a means to finance infrastructure projects, thereby attracting domestic and international investors.
9. Egypt
Egypt has initiated its sukuk program, with an aim to issue $3 billion in sukuk by 2026. The government’s focus on mandatory equity sukuk reflects its strategy to diversify funding options and enhance liquidity in the market.
10. Oman
Oman’s sukuk market is developing, with total issuances around $2 billion in 2021. The government is considering mandatory equity sukuk to attract foreign investment and boost economic growth.
11. Kuwait
Kuwait’s sukuk market has been steadily growing, with issuances reaching $1.5 billion in 2021. The country is emphasizing the development of innovative sukuk structures, including forced conversion mechanisms.
12. Morocco
Morocco is exploring sukuk as a financing tool, with initial issuances around $1 billion. The government is considering mandatory equity sukuk to attract investments in infrastructure and social projects.
13. Jordan
Jordan’s sukuk market is in its nascent stages, with issuances of approximately $500 million. The country is focusing on the development of equity sukuk to diversify its funding sources.
14. Bangladesh
Bangladesh has recently entered the sukuk market with initial issuances of around $300 million. The government is planning to expand its sukuk offerings, including mandatory equity sukuk, to enhance infrastructure financing.
15. Nigeria
Nigeria’s sukuk market is gradually emerging, with issuances around $250 million. The government is exploring equity sukuk to attract investments for social and economic development projects.
16. Tunisia
Tunisia is developing its sukuk framework, with a focus on issuing around $200 million in sukuk by 2026. The government is considering mandatory equity sukuk to enhance liquidity in the financial market.
17. South Africa
South Africa’s sukuk market is still developing, with initial issuances of around $150 million. The country is exploring innovative sukuk structures, including forced conversion, to cater to its diverse investor base.
18. Azerbaijan
Azerbaijan is expected to issue its first sukuk in the coming years, with projections of around $100 million. The government is keen to develop mandatory equity sukuk to diversify its funding sources.
19. Afghanistan
Afghanistan is planning to introduce sukuk within its financial framework, with anticipated issuances of around $50 million. The government aims to leverage equity sukuk for reconstruction and development projects.
20. Lebanon
Lebanon is exploring the potential of sukuk with initial plans for around $30 million in issuances. The government is considering mandatory equity sukuk to address its financial challenges and attract foreign investment.
Insights
The mandatory equity sukuk market is poised for significant growth by 2026, driven by increased awareness of Sharia-compliant investment opportunities and a favorable regulatory environment in key markets. The global sukuk issuance is projected to reach $500 billion by 2026, fueled by innovations in forced conversion mechanisms that enhance liquidity and investor participation. Countries like Malaysia, Saudi Arabia, and Indonesia are expected to lead in this space, while emerging markets will continue to explore sukuk as a viable financing option. With the integration of technology and sustainable practices, the sukuk market is likely to capture a more significant share of the global debt market, reinforcing its relevance in the financial landscape.
Related Analysis: View Previous Industry Report
