What is your outlook for the global sukuk market for 2010 the opportunities and the challenges?
The global sukuk market was certainly not spared the effect of the global credit crisis and suffered a slowdown in FY2008. However, we saw an overall rebound in FY2009. I see 2010 as a promising year with several sovereign issues in the pipeline including debuts from several Asian sovereign issues. Further, as the world economy recover, we expect to see a return of the corporate sukuk market as led by the recent GE and Petronas issuances. The challenge is to ensure that best practice and governance are being adopted in the structuring of a sukuk and adequate legal framework to support them, especially in jurisdiction that has a young debt capital market. It is important to dispel concerns raised on inadequate governance and investor protection issues arising from recent high profile sukuk defaults. The opportunity lies in the shift of appetite from conventional products to Islamic products by investors in the aftermath of the global crisis as the latter is seen to be safer.
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