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RIYADH: Sukuk issuance globally is expected to total between $160 billion and $170 billion in 2024 thanks to higher financing needs in some core Islamic finance countries, according to S&P Global.  

In its latest report, the US-based agency said that the steady momentum of the sector is also supported by easing liquidity conditions across the world.  

In 2023, global sukuk issuance declined by 6.1 percent to $168.4 billion compared to the previous year, due to tighter conditions in ��������’s banking system and Indonesia’s lower fiscal deficit.  

However, the drop in 2023 was somewhat compensated by an increase in foreign currency-denominated Shariah-compliant bonds.

S&P Global further noted that digitalization could unlock some opportunities by streamlining sukuk issuance, even though it demands the harmonization of legal documents and a standardized interpretation of the Shariah. 

According to the report, sustainable Shariah-compliant bond volumes are also expected to rise in 2024, on the back of the successful UN Climate Change Conference held in Dubai last year.

“Sustainable sukuk will also continue to contribute to the increase in sukuk issuance, which is still low, while the recently concluded COP28 in the UAE highlighted the role Islamic finance and sukuk can play in addressing climate change,” said S&P Global in the report.  

Earlier this month, it was announced that ��������’s National Debt Management Center is on track to launch a sukuk savings program to further develop the local market.  

Speaking at the Capital Market Forum, Hani Al-Medaini, CEO of NDMC, said that the center has planned several initiatives to help the domestic market grow and strengthen.  

The official informed that NDMC is planning to get riyal-denominated sukuk included in global indices with the help of the Capital Market Authority.  

He added: “The CMA is leading us on that front while providing full support. That will help in creating more liquidity in our domestic market.”