The Islamic industry is expected to continue growing by 10 to 12 percent over 2021 and 2022, according to S&P Global Ratings, media reports stated. Despite some countries‘ gross domestic product growth anticipated to be lower than what had been observed historically, S&P Global the Islamic finance growth to be increasing.
Mohamed Damak, Global Head of Islamic Finance and Sector Lead, Financial Institutions, Middle East and Africa, S&P Global, told the media that the Islamic finance industry would be supported by strong financial growth in Saudi Arabia in mortgages and corporate lending. In Qatar through investments related to the upcoming football World Cup. In the UAE, growth can be expected due to the Dubai Expo.
He further added that, “We think that the Dubai Expo will probably create some dynamics and trigger some lending growth. Other countries, like Malaysia and Turkey, will also continue to grow, although Turkey’s growth will be at a slower pace, driven primarily by public sector participation banks.”
The total insurance of the sukuk market is expected to grow between $140 billion and $155 billion in 2021 against almost $140 billion in 2020. Many sovereigns in the core Islamic finance countries are expected to tap into the Islamic finance market more spontaneously in 2021 after tapping into conventional markets last year.
According to Mohamed, about $65 billion worth of sukuk is expected to mature in the current year, and it is believed that part of this amount is likely to be refinanced on the sukuk market. The other significant components of the growth are funds and takaful.