Rabat – The first issuance of government-backed sukuk, or Islamic bonds, will occur before the end of 2017, according to Moroccan Economic and Finance Minister Mohammed Boussaid.
“These new financial instruments should contribute to the development of participative banking, allowing the mobilization of funds as needed,” Boussaid said, speaking at the second annual symposium of Islamic Economics and Finance, held on the 8th and 9th of December in Rabat.
The event, organized by the World Bank and the Islamic Development Bank, brings together academics, lawmakers and other stakeholders to discuss the future of Sharia-compliant banking.
Moroccans living in the kingdom and abroad will be able to purchase the bonds, which will be used to support state-run development projects and other private sector entities.
“For the operationalization of the first participatory programs on the capital market and the support of participatory finance, our department is looking, firstly, to develop the regulatory framework necessary for the issuance of the sukuk in Moroccan financial markets, and on the other hand, and secondly, to structure the first sovereign sukuk issue, which will serve as a benchmark for other similar initiatives,” the minister said.
Originally, the government planned to issue the first sukuks by the end of 2016, according to an agreement signed with the Islamic Society of Private Sector Development.
A 2013 finance law allows for the issuance of sukuk bonds to foreign markets, but the National Sharia Board, in charge of Morocco’s Islamic financial products, just recently gave the go-ahead for the bond category to begin business domestically.
