Dubai International Financial Centre to bring together world industry leaders

Goal to enlarge Sukuk primary market

The Dubai International Financial Centre (DIFC) today revealed plans for a groundbreaking workshop to discuss the burgeoning global demand for a more developed sukuk market.

The DIFC will bring together influential bodies like the Liquidity Management Centre of Bahrain (LMC) and the International Islamic Financial Market (IIFM) of Bahrain in November to address such issues as the current paucity and narrow range of sukuk products available and how to encourage providers to work together to develop the market and meet the pent up demand. Potential issuers and investors such as fund managers, institutions, governments and corporates from around the world will also be invited to ensure comprehensive discussions and tangible results.

Sukuks, largely issued by sovereigns and corporates, offer the advantage of fixed returns rather than the fluctuating returns from other investment vehicles such as equities. However, currently the Sukuk market size is only just over USD 3 billion. According to industry statistics, Islamic finance fund managers have in the region of USD 30 billion in surplus cash, due to the lack of suitable product in which to invest.

Naser Nabulsi, CEO of DIFC commented,

“There is a very real need globally for more choice, capacity and sophistication in the sukuk market and we believe that the DIFC can provide thought leadership through this industry workshop, as well as help to match industry players. We will be discussing the expansion of the asset classes available and the development of long-term sukuks of twenty or thirty years, allowing the market to mature and develop more stability.

HH Sheikh Mohammed is establishing the DIFC to position Dubai as a universally recognised hub for institutional finance and as the regional gateway for capital and investment to the Middle East. It has already received commitment from many of the world’s biggest financial services companies such as AON, Credit Suisse, Standard Chartered and Julius Baer.

The LMC, established by a group of local and regional Islamic financial institutions, serves to help Islamic finance houses manage their day-to-day liquidity requirements.

IIFM, an independent non-profit international organisation, aims at ensuring the continued growth of Islamic banking and finance as a viable alternative to the conventional financial system.