Senegal joins the ranks of west African countries issuing Sukuk - IFN

Senegal joins the ranks of west African countries issuing Sukuk

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SENEGAL: West Africa seems to be picking up the pace in terms of Sukuk, as Senegal becomes the latest country after Nigeria to announce plans to diversify its financing resources through a Shariah compliant facility. The US$200 million local currency-denominated Sukuk was initially announced in August this year, but plans ground to a halt as the west African country was said to be grappling with technical issues arising from a lack of expertise. The original plans were also shelved due to timing concerns, which were said to be less than ideal due to the country’s pre-election campaign at the time. In light of this, the Islamic Corporation for the Development of the Private Sector (ICD) has given a boost to the sovereign issuance by the Senegalese government issuance by offering its technical assistance to the issuance which is due next year. Amadou Ba, Senegal’s minister of economy and finance, has reaffirmed the government’s interest in issuing Sukuk, which he expects will lead to more Shariah compliant issuances; especially for infrastructure and energy projects in the country. The project is said to be the first of its kind for the West African Economic and Monetary Union (WAEMU), and aims to promote Islamic finance as an alternative instrument to finance the economies of the member states of the union. Commenting on the issuance Khalid Al Aboodi, CEO of the ICD, said that the Senegalese Sukuk would be the first of a series of regional programs that would be offered to West African states. He also added that the Sukuk, which will be arranged by Citigroup, has been accepted in-principle by the Central Bank of West African States to be used in its repurchase operations, and is expected to spark interest amongst banks involved in the local money market as an attractive investment option.