On Sunday, October 1, the First AlBaraka Regional Conference titled “Sukuk For Sustainable Development: International Best Practices”, organized by AlBaraka Forum for Islamic Economy, was launched in cooperation with the Arab Administrative Development Organization – the League of Arab States, and the Egyptian Islamic Finance Association, and under the patronage of H.E. Dr. Mohamed Maait, Egyptian Minister of Finance.
H.E. Mr. Yousef Hassan Khalawi, Secretary General of the AlBaraka Forum for Islamic Economy, delivered the opening speech in which he pointed out that five decades ago, everyone in the Arab and Islamic countries was preoccupied with development concerns, obsessed with emancipation from dependency on others.
He added that, as has been the case since the dawn of history, Egypt embraced two great pioneers in the field of economics: Prince Muhammad Al-Faisal Al Saud and businessman Sheikh Saleh Abdullah Kamel, both of whom found support at various levels in Egypt. And renewed thought and specialized human resources, explaining that what the two men sowed – along with a number of other pioneers like them in various regions of the Islamic world – will bear fruit after decades of time, a global industry with deep roots, abundant assets, high momentum, widespread, and constantly renewed, which is the Islamic banking industry, including… It contains the instruments.

He emphasized that this industry has an impact in all directions, from the G20 agenda to the United Nations and its agencies, central banks, international investment funds, and global capital markets.
He also stated that the Al Baraka Forum decided to launch its specialized regional conferences from Egypt decades after its initial launch, out of gratitude and belief in the great global role that Egypt can play, not only as a former pioneer, but also as an innovative and constantly capable environment – and history does not error or lie. He concluded his speech by saying that Egypt is able, through a system of openness to promising financing tools such as sukuk, to bring about real, comprehensive and sustainable development.

In his opening remarks, H.E. Dr. Nasser Al-Qahtani, Director General of the Arab Administrative Development Organization, emphasized the importance of enhancing the role of sukuk as a vital financial tool that contributes significantly to achieving sustainable development goals. He stated that the world today is facing economic, environmental, and social issues, and that in order to solve these challenges and secure a sustainable future, financial innovations related to sustainable development are required. His Excellency pointed out the importance of enhancing the role of sukuk as a vital financial tool that contributes significantly to achieving sustainable development goals, through the important roles that sukuk play, including financing development projects, diversifying funding sources, and committing to social responsibility, as well as enhancing confidence and stability by adopting Sharia rules. Islamic law and the great level of transparency associated with sukuk.
He also expressed his hope that this conference would be an opportunity to discuss the most prominent issues and challenges related to sukuk and their applications through the participation of experts, decision makers, representatives of various banks, and other stakeholders concerned with the topics of local and international sukuk.
He also expressed his thanks and appreciation to the organization’s partners in the conference, the Al Baraka Forum for Islamic Economy and the Egyptian Islamic Finance Association. He also thanked the experts, speakers, and session chairs.
For his part, Dr. Mohamed El-Beltagy, President of the Egyptian Society for Islamic Finance, presented the concept of sukuk, their mechanisms, their importance, and their working methods. He said that sukuk contribute to financing projects through certain mechanisms, and in order to sukuk to be issued, there must be a project, an issuing destination, and a beneficiary destination. He said, “We have not seen at the international level any A bankrupt instrument, or the issuance of which has failed.”
He pointed out that most major countries issued sukuk, such as England, America, and many Arab countries, and the sukuk succeeded in meeting their needs.
His Excellency the Secretary General of AlBaraka Forum for Islamic Economy, the Director General of the Arab Administrative Development Organization, and the President of the Egyptian Association for Islamic Finance also handed over the shield of honor to His Excellency Mr. Mohamed Hegazy, Advisor to the Egyptian Minister of Finance for Sukuk, on behalf of His Excellency Dr. Mohamed Maait, the Egyptian Minister of Finance, for his generous sponsorship of the conference.

In addition, AlBaraka Forum for Islamic Economy and Arab Administrative Development Organization exchanged shields of honor for both institutions, emphasizing the fruitful cooperation and its development in the future.
It is worth noting that during the opening session, the first documentary film about sukuk was shown, entitled “Sukuk: Green Investment,” reviewing the origins of sukuk through contemporary history and their global development, pointing to international efforts to enhance the role of sukuk as one of the most promising investment financing tools, especially in sustainable development projects. The film also shed light on the successful Egyptian experience in issuing sovereign bonds to finance infrastructure projects and support economic growth.

It is worth noting that the conference included three discussion sessions as follows:
Session 1: ” sukuk and the development of macroeconomic sectors that covered four main topics:
1) Sukuk: their types, risk management, and their impact on macroeconomic indicators.
2) Sukuk and their impact on the performance of conventional and Islamic banks.
3) Sovereign Sukuk as a financial instrument for financing the general budget of the state.
4) Developmental aspects of financing small and medium-sized projects through Sukuk.

The second session was held under the title of ” sukuk: international experiences and best practices” and included five topics:
1) The experience of the Islamic Development Bank in issuing sustainable Sukuk.
2) The experience of Albaraka Türk Participation Bank in issuing Sukuk.
3) Sukuk and the Significance of High-Quality Liquid Assets in Times of Liquidity Crunch.
4) Credit ratings for Sukuk.
5) The Impact of Standardized Sukuk Documentation in Enhancing the Global Financial Markets.

The third and final session was titled “Egypt’s Sukuk Issuance Experience from Legal and Shariah Aspects” and included four topics:
1) The Experience of Issuing the First Sovereign Sukuk in Egypt.
2) Sharia Standards in Issuance and Trading of Sukuk.
3) Procedural aspects of Sukuk issuance.
4) Reality and Legal Challenges Facing the Growth of Sukuk Market in Egypt.

The final statement presented the most important recommendations in this regard, which were delivered by H.E. Mr. Yousef Khalawi, Secretary General of AlBaraka Forum for Islamic Economy as follows:
1) The issuance of Egyptian Sovereign Sukuk Law No. 138 of 2021 is a significant step forward in diversifying Egypt’s financial sources. The success of the maiden issue of Egyptian Sovereign Sukuk indicates the Egyptian economy’s resiliency in the face of global and regional concerns. This underscores the need to expand present law to encompass other types of Sukuk rather than being limited to only four: Murabaha, Ijarah, Istisna’, and Wakala.
2) Study the success aspects in international Sukuk experiences and build cooperation protocols with supporting and supervising authorities in order to expand industrial and green financing initiatives.
The significance of developing and diversifying Sukuk issuances to satisfy the needs of economic sectors and sustainable growth, with a priority on medium and long-term Sukuk and Sukuk to finance infrastructure projects.
4) Create a database on the conditions of the Sukuk investment market in terms of market activity and the availability of Sharia compliance in Sukuk issuance and trading, as a requirement for investors in this market to make investment decisions.
5) Establish a complete plan for training and qualifying human resources, including providing them with the essential expertise, skills, and relevant information in the domains of jurisprudence, economics, and financial accounting when dealing with Sukuk.
6) Work on specialized information systems that manage Sukuk issuance operations and govern subscription and trading rules, with the goal of continuously developing these systems to keep up with advancements in the Islamic financial sector.
7) Develop a strategy for controlling the risks connected with Islamic Sukuk transactions and addressing legislative or regulatory difficulties.
8) Seek to establish an effective Islamic financial market characterized by transparency and governance, capable of mobilizing and allocating financial resources, with the goal of increasing the market’s investor base. In addition, work is being done to build a secondary market for sovereign Sukuk in order to maximize their use as a vehicle for growing national savings.
9) Lessons from Malaysia, Saudi Arabia, the United Arab Emirates, Indonesia, and other nations’ experiences with sovereign Sukuk funding infrastructure projects.
10) The General Authority for Financial Control should issue an Egyptian accounting standard for Sukuk in order to achieve standardization in transparency and disclosure.
The conference aims to clarify the role and importance of sukuk in financing national development and sustainable projects, present and analyze international best practices and challenges related to issuing sukuk and shed light on the technical and practical solutions to structuring sukuk in addition to the legal and legal aspects. The conference was attended by a number of scholars, experts, and economists from various fields, both from within the Arab Republic of Egypt and abroad.

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