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On Tuesday, the Indonesian government claimed control of 23.11 percent of the worldwide sharia bond market by issuing $23.65 billion in Islamic bonds.
The government has been aggressively issuing Islamic financial certificates, commonly known as Sukuk, in recent years, which have proven to be rather resistant to the economic impact of the Covid-19 pandemic.
Finance Minister Sri Mulyani Indrawati said in seminar in Jakarta, “Indonesia has become a major issuer of Sukuk in the international markets. The total value of our Sukuk is $23.65 billion with a 23.11percent share of the global Sukuk issuance.”
According to her, the government has issued $3.5 billion in Sukuk with attractive returns to investors since 2018. She also added that, shariah-compliant financial firms have remained strong throughout the epidemic, as seen by continued expansion in sharia bank financing and low levels of non-performing loans.
She added that, the world’s rapidly growing Muslim population has become the primary driving force behind the rise in demand for sharia-compliant financial products, which have now emerged as a new source of interest for global investors. She noted that a more digitized world and the rapid development of the halal industry help to drive growth in Islamic financial services.
Indonesia has the world’s largest Muslim population, with Islam followers accounting for more than 80% of the country’s 272 million people.
According to the Financial Services Authority, the country has 34 sharia banks with a combined asset of Rp 571 trillion ($40 billion) and more than 1,300 branches across the archipelago (OJK).
