IslamicFinance.de

Jordan's first ever law covering the issuance of sovereign Islamic sukuk has been finalised and bankers and officials hope it will let the kingdom tap the fast-growing Islamic banking industry's huge pool of liquidity.
Prominent Islamic bankers, along with members of a top-level ministerial committee mandated with drafting the sukuk law, said the legislation removes legal uncertainties and would be submitted to the cabinet in as little as two weeks.
It should be passed by year end, widening Jordan's borrowing options beyond conventional public debt instruments and helping finance a growing deficit, worsened by the global downturn and a fall in foreign aid that traditionally covers budget shortfalls.
Jordan has not had special laws relating to Islamic finance, but as Islamic financing expands pressure is mounting on the monetary authorities to apply sharia compliant legislation.
Assets of the three existing Islamic banks in Jordan alone amount to around 12 percent of the total banking system and their financing accounts for over 16 percent of total credit.