Middle East sukuks may rise to $15bn this year

Global sukuk (Islamic bond) issuances went up by more than double to $31billion (Dh113.8bn) in 2009, with the UAE accounting for more than one-fourth of the total, said a Bank of America Merrill Lynch's study.

The issuances in Middle East are likely to go up to $10bn-$15bn in 2010, it said.

Issuances saw a steep fall in 2008 and were about $15bn in 2008. The sector saw activity picking up in the last quarter of 2009.

However, the outlook for new issuance is bright, according to a DIFC sukuk guide. Construction, real estate and financial services, which accounted for more than 40 per cent of the total issuance between 2004 and 2008, saw a sharp decline. "The situation changed in 2009. Construction and real estate saw a sharp decline in issuance, while financial services remained robust. Power as well as oil and gas also saw a significant rise in issuance, and together with financial services become the three largest sectors in terms of new issuance," said the report.

 

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