Jul 26 2011
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Use of Islamic Finance Mechanisms a Priority
Promoting the capital market and using Islamic financing mechanisms are the top priority of the government, said minister of economic affairs and finance.
Speaking at a seminar titled 'Securing Finance Through Sukuk', Shamseddin Husseini pointed out that global Islamic financing mechanism stood at $1.2 billion in 2000 but this figure increased to $58.5 billion in 2010, reported IRIB News.
Close to $233 billion worth of Islamic bonds were published worldwide during 1994-2010, of which $47 billion pertained to Iran, he pointed out.
The government has been studying plans to publish more Islamic bonds (sukuk) since last year, he noted.
An aviation company and a bank managed to issue sukuk for infrastructural projects and giant economic activities, Husseini added.
Also, managing director of Bank Mellat said securing finance through Islamic bonds is one of plans for overhauling the banking system.
Ali Divandari pointed out Islamic financing mechanisms are gradually playing a greater role in the country's finance, Mehr News Agency wrote.
He explained that the country boasts Sharia-based assets worth $315 billion.
The official said the banking system, Tehran Stock Exchange (TSE), Over-the-Counter (OTC) market, and the Securities and Exchange Organization of Iran have expressed readiness to use monetary means.
Speaking at the same gathering, head of Iran Chamber of Commerce, Industries and Mines said productions units should publish sukuk rather than referring to banks or issuing participation bonds.
However, the culture of using sukuk should be promoted in the society, Mohammad Nahavandian added. In addition to steering financial markets, sukuk can help promote the capital market, he concluded.
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