FG To Use Islamic Bond To Build Airports, Refineries -

Central Bank of Nigeria (CBN), Debt
Management Office (DMO) and the
Infrastructure Concession Regulatory
Commission (ICRC), are exploring ways to
use Sukuk to build airports, railways and
refneries.
Speaking at the National Conference on
Islamic Banking and Finance in Nigeria,
Wednesday, in Abuja, CBN Governor,
Mallam Sanusi Lamido Sanusi, said that in
view of the potentials of Sukuk to develop
economies in building infrastructure, the
CBN, in conjunction with other sister
institutions like the Securities and Exchange
Commission(SEC), ICRC, DMO, had
assembled a technical team to explore the
prospects of alternative modes of finance
and set out the procedures for using the
modes in the development of
infrastructure.
He stated that the team had identified, in
its report, potential projects that could be
financed by sovereign and sub-sovereign
Sukuk.
“These projects include upgrade,
maintenance, repairs and new construction
of roads and highways; upgrade, renovation
and new construction of airports,
rehabilitation of the rail line and the
building of a new rail line and railway
stations. Part funding for the construction
of the planned three refineries and mass
housing and light rail for some states in
the federation” he said.
This, he said, was in addition to the role
that Sukuk issuance served in deepening
domestic capital markets.
Sanusi noted that only recently, the Osun
State government successfully issued a sub-
sovereign Sukuk worth N10 billion for
building public schools and the issuance
was oversubscribed.
“The issuance which was oversubscribed
and had a full up-take by the originator,
shows the buoyancy of our capital market
and its need to take up new alternative
instruments” he said.
To further underscore the importance of
Islamic Sukuk, the governor hinted that the
Prime Minister of United Kingdom, David
Cameron, announced the plan to make
London not just a capital for Islamic
finance to the Western world, but one that
would stand along side Dubai and Kuala
Lumpur as one of the great capitals of
Islamic finance, anywhere in the world.
“Last week, I was at the 9th World Islamic
Economic Forum in London hosted by the
UK Government and at that function, the
Prime Minister, David Cameron, announced
his government’s plan to make London not
just a. capital for Islamic finance to the
Western world, but one that would stand
along side Dubai and Kuala Lumpur as one
of the great capitals of Islamic finance,
anywhere in the world.
The UK plans to do this through the
issuance of an Islamic bond sukuk, worth
200 million GBP by the UK Government
which it intends to do as early as next year.
It also plans to create an islamic index on
the London Stock Exchange for Shariah
compliant securities to attract more islamic
investors.
“The UK is embarking on this plan, despite
the fact that it is a non-Islamic country
which illustrates what we have been saying,
that Islamic finance, though based on
sharia, is a financial product with clear
goals and it is accessible to all” he said.
http://www.tribune.com.ng/news2013/
index.php/en/news/item/25722-fg-plans-
use-of-islamic-bond-to-build-airports
,-refineries.html

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