The Role of Sukuk in Islamic Capital Markets
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Figure 3.1: McKinsey’s Building Blocks to Sustain the Long-Term Growth of Capital Markets
Source: McKinsey & Company (2017)
3.1 CRITICAL SUCCESS FACTORS FOR A SUSTAINABLE SUKUK MARKET
Central to the development of a sustainable sukuk market is the provision of a level playing
field vis-a-vis conventional bonds. Commercial reasoning will always be the tipping point for
issuers, and creating a vibrant, thriving environment for sukuk is the key to success. Another
critical component is to have a “top down” approach to promoting the Islamic finance agenda.
The dynamic shift towards sukuk, instead of conventional bonds, is a balance driven by both
supply (sell side) and demand (buy side). This can only be achieved through the collective
efforts of governments and regulators, in collaboration with industry players.
Based on our analysis, each jurisdiction has evolved in its own way to overcome inherent
domestic risks. The concerted efforts of key market stakeholders listed in Table 3.1 can
facilitate a supportive ecosystem in which sukuk issuance can thrive: