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Saturday, 20 July 2013

Tunisia wins green light to issue sukuk

TUNIS: Tunisia's parliament has passed a law that will allow the state to issue Islamic bonds, or sukuk, a move that could help narrow a gaping budget deficit and boost foreign currency reserves, which have fallen to critically low levels.
Finance Minister Elyess Fakhfakh told parliament that his ministry planned sometime in November or December to issue a sovereign sukuk to raise $700 million.
The government, led by moderate Islamists, is keen to develop Islamic finance.
A Tunisian sukuk issue could potentially attract large amounts of Islamic-oriented funds from the Gulf.
The bill received 102 votes in favour in the vote in parliament, held in a closed session late on Wednesday.
"Tunisia's financial difficulties require the mobilisation of all resources, including Islamic sukuk," Fakhfakh said.
Tunisia is running a large state budget deficit, which it has projected at about $3.2 billion this year, and political tensions are hurting its ability to finance itself.
The North African country, which has also signed a $1.7bn standby loan agreement with the International Monetary Fund, is struggling with rising inflation and a big external deficit as well as its uncertain political outlook.
Parliamentary finance committee chairman Ferjani Dogman said the sukuk would help diversify Tunisia's funding sources, but were "not aimed at Islamisation of the economy".
(Gulf Daily News / 19 July 2013)

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Japan offers cooperation with Malaysia in Islamic finance

Islamic finance is one key area in which Japan and Malaysia can cooperate in order to enhance relations between the two countries, deputy DG of the International Bureau, Ministry of Finance of Japan, Hiroshi Naka said in Kuala Lumpur yesterday.

The combination of Japan and Islamic finance seems very strange to some people, but for the Japanese nation, it is quite natural to engage in Islamic finance because it is a new frontier, he said.

“Islamic finance is one key area in which Japan wishes to enhance its cooperation with Malaysia.

“Japan will continue to encourage the Bank of Tokyo-Mitsubishi UFJ to engage in Islamic finance and supports the bank’s efforts to facilitate the use of Islamic finance in Malaysia and in Japan,” he said during the launch of the new Islamic products by the Bank of Tokyo-Mitsubishi UFJ (M) Bhd (BTMU).

He pointed out that one of the attache of the Japanese Embassy in Kuala Lumpur undertook a full course at the International Centre for Education in Islamic Finance, stating that this was the proof for Japan’s commitment.

Also present was Bank Negara Malaysia’s director of Islamic banking and takaful, Wan Mohd Nazri Wan Osman, who officiated the launch of the four new products.

Wan Mohd said as the country opens up as a global Islamic finance destination, Malaysia sees the BTMU engagement in the Islamic finance as a very positive move, as it is a way to optimise its platform in Malaysia. He also said the new products enhanced the bank’s involvement in the cross-border business in Islamic finance.

The products are the Istina’ Financing-i, Ijarah Financing-i, Bank Guarantee-i and the standby letter of credit-I.

The new product lines unlock new business opportunities to improve our financing and fee-based income, the CEO of BTMU Malaysia, Masato Nakamura said.

Nakamura also said BTMU intended to become an Islamic finance hub in Malaysia.

The BTMU’s operation is mainly focused on financing large corporations and Japanese companies based in Malaysia.

It launched the Islamic products to increase its fee-based income. In the past, the bank had financed a RM540.6 million Islamic syndicated project for liquefied natural gas vessel for Brunei Gas Carriers Sdn Bhd.

BTMU may establish a window for Islamic finance in Malaysia soon, but no date was given by the officials during the ceremony. It has also made headway in the Islamic financing segment, especial ly in cross-border financing.

BTMU started operations in Malaysia in 1957 and is also the longest serving Japanese bank in the country.

(The Malaysian Reserve / 18 July 2013)

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UAE: VP’s Islamic banking plan praised

DUBAI: UAE Vice President, Prime Minister and Ruler of Dubai His Highness Sheikh Mohammed Bin Rahsid Al Maktoum received President of the Islamic Development Bank (IDB) in Saudi Arabia, Ahmad Mohamed Ali, and other IDB officials from the Islamic economy sector in Dubai and Islamic bankers, at Zaabeel Palace on Friday evening.

The Islamic economy sector’s officials and other bankers in the field praised the initiative “Dubai: Capital of Islamic Economy,” launched by Sheikh Mohammed earlier this year, saying the initiative reflects His Highness’ prudent vision for the future of Islamic economy in the region and in the world. 

They added that Sheikh Mohammed’s initiative has received the attention of local and global banking bodies and decision makers who started implementing it in their institutions.

During the meeting, which saw the presence of Dubai Crown Prince Sheikh Hamdan Bin Mohammed bin Rashid Al Maktoum and Dubai Deputy Ruler Sheikh Maktoum Bin Mohammed Bin Rashid Al Maktoum, Sheikh Mohammed and his guests exchanged Ramadan greetings.

After Al Maghreb prayers, Sheikh Mohammed hosted an Iftar banquet in honour of his guests.

Also present at the meeting and the Iftar banquet were Chairman of Dubai Arts and Culture Authority Sheikh Majid Bin Mohammed bin Rashid Al Maktoum, Sheikh Mansour Bin Mohammed Bin Rashid Al Maktoum, other sheikhs, ministers, senior officials and heads of banking sector in the UAE.

(The Gulf Today / 20 July 2013)

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