Islamic securities of interest to private companies: Kazakhstan’s Finance Minister Bolat Zhamishev

Bolat Zhamishev. By Serik Turlybekov ©

Raising money through Islamic securities (sukuk, in particular) is of interest to private companies first of all, Kazakhstan’s Finance Minister Bolat Zhamishev said when speaking at the 7th World Islamic Economic Forum in Astana June 9. “Years of crisis is a good opportunity to see how reliable these or those financial instruments are … Islamic financial instruments proved to be flexible and convenient for borrowers”, he said. When it comes to state-issued sukuk (Islamic equivalents of bonds), the Minister said “the government seeks to diversify its borrowings, including in terms of instruments”. He also suggested that respective amendments [enabling to issue Islamic securities in Kazakhstan] will be adopted shortly, Interfax – Kazakhstan reports. “The draft legislation has been passed by the lower Chamber and submitted to the Senate. I believe the amendments will be passed within a month”, B. Zhamishev said. Since fixed income, interest bearing bonds are not permissible in Islam, Sukuk securities are structured to comply with the Islamic law and its investment principles, which prohibits the charging, or paying of interest.

Raising money through Islamic securities (sukuk, in particular) is of interest to private companies first of all, Kazakhstan’s Finance Minister Bolat Zhamishev said when speaking at the 7th World Islamic Economic Forum in Astana June 9. “Years of crisis is a good opportunity to see how reliable these or those financial instruments are … Islamic financial instruments proved to be flexible and convenient for borrowers”, he said. When it comes to state-issued sukuk (Islamic equivalents of bonds), the Minister said “the government seeks to diversify its borrowings, including in terms of instruments”. He also suggested that respective amendments [enabling to issue Islamic securities in Kazakhstan] will be adopted shortly, Interfax – Kazakhstan reports. “The draft legislation has been passed by the lower Chamber and submitted to the Senate. I believe the amendments will be passed within a month”, B. Zhamishev said. Since fixed income, interest bearing bonds are not permissible in Islam, Sukuk securities are structured to comply with the Islamic law and its investment principles, which prohibits the charging, or paying of interest.

legislation Kazakhstan investment finance