Global sukuk market to hit $2.7trln by 2030: Franklin Templeton | ZAWYA MENA Edition

Global sukuk market to hit $2.7trln by 2030: Franklin Templeton | ZAWYA MENA Edition:

The global sukuk market is set to grow at a compound annual rate of around 15 percent to reach $2.7 trillion by 2030, according to investment management firm Franklin Templeton.

In a media briefing at its Dubai office last week, the company’s chief investment officer of global sukuk and Middle East and North Africa (MENA) head of fixed income, Mohieddine Kronfol, described its forecast as a “base case”, stating that growth could be faster if there is more widespread adoption of shariah-compliant debt instruments, particularly in more mature markets. However, it could also slow if forecasted growth in emerging markets such as Nigeria, Pakistan and Turkey fails to materialise, Kronfol said.

Global sukuk issuance stood at over $477 billion at the end of last year, but has slowed somewhat in recent years following a boom in the early part of this century. Figures published by ratings agency S&P Global in January described sukuk issuance as ‘mild’ in 2018, as the total amount of sukuk issued dropped by 5 percent to $114.8 billion. It forecast issuance of $105 billion-$115 billion for 2019, although this prediction was made assuming an average Brent oil price of $55 per barrel.