Among the GCC countries, Bahrain maintained its second position globally, while the UAE switched positions with Oman to come third, with the latter dropping to fourth. Saudi Arabia, which is the world's second biggest jurisdiction in terms of Islamic finance assets, jumped to sixth from ninth overall, said the report released by Thomson Reuters and Islamic Corporation for the Development of the Private Sector.
The report, which was released for the third consecutive year, examines the key statistics and trends across five indicators that are deemed to be significant for measuring the development of the $1.8 trillion Islamic finance industry. These include Quantitative Development, Knowledge, Governance, Corporate Social Responsibility and Awareness. These indicators are tracked across 108 countries, which had contributions in all or some of these indicators.
Pakistan, Jordan, Hong Kong, India, Botswana and Ivory Coast are some of the countries that have demonstrated positive movements in the IFDI 2015 ranking.
"As the leading Islamic finance institution supporting private sector development across the Islamic world, we recognise that the industry requires effective holistic measures to focus our efforts to facilitate and ensure inclusive financial sector development," said Khaled Al Aboodi, CEO of ICD.
In 2014, global Islamic finance assets climbed to $1.814 trillion, representing a 9.4 per cent rise from $1.66 trillion in 2013. This increase was driven by strong growth in all sectors - Islamic banking, takaful, sukuk and Islamic funds. The value of assets in the Islamic finance sector is expected to increase by 10 per cent per annum over the next five years, reaching $3.24 trillion by 2020.
"The Islamic finance industry has demonstrated tremendous growth over the last few years. We have seen the industry develop a conducive eco-system that made it possible for many countries to enter this space. Currently, there are more than 1,000 Islamic financial institutions most of which are located in the GCC and Southeast Asia and we expect this number to increase significantly in the next decade," said Nadim Najjar, Managing Director, Middle East & North Africa, Thomson Reuters
The number of Islamic finance degrees and courses as well as research papers increased in 2014, with 2013 leaders Malaysia, Bahrain, and Jordan retaining their leadership positions on the Knowledge Indicator for 2014.
Some 378 institutions offered Islamic finance education in 2014. Malaysia and UK lead 36 countries that offer Islamic finance degrees, with 141 institutions offering Islamic finance courses.
Bahrain and Malaysia maintained their respective first and second positions on the overall Governance indicator, which considers three factors: Regulations, Corporate Governance, and Shariah Governance. There remains a huge gap between the two leaders and the rest of the countries.
Bahrain, Malaysia, Pakistan, Nigeria, and Indonesia are the jurisdictions with the most complete set of Islamic finance regulations. These are the jurisdictions providing best practice models for Islamic finance governance, and which are considered as models by new markets such as France, Germany, Ghana, and Russia.
(Khaleej Times / 04 December 2015)
---Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com
