Sovereign sukuk market gains momentum in Cote d’Ivoire and Togo
The two West African nations join Senegal in tapping the market for sukuk, helping expand the use of Islamic financing options outside of the industry’s core centres in the Middle East and Southeast Asia.
Cote d’Ivoire will sell the 7-year sukuk using a lease-based contract known as ijara, with the subscription period closing on 31 August, according to the Saudi-based Islamic Corporation for the Development of the Private Sector (ICD).
This would represent the second phase of a 300 billion CFA franc sukuk programme set up last year by the world’s top cocoa producer and French-speaking West Africa’s economic powerhouse.
Togo plans to complete the sale of its sukuk later this week, aiming to raise 150 billion CFA franc with a 10-year maturity and a 6.5 percent yield. The ICD is the lead arranger for both the Togo and Ivory Coast sukuk.
These back-to-back deals could boost the ICD’s efforts to expand its activities across Africa, where the development of Islamic finance has lagged despite being home to a quarter of the world’s Muslims.
Nigeria and Kenya are also planning to issue sovereign sukuk of their own, in part to help fund large infrastructure needs, although the timing for such deals has yet to be determined.