Financial Outlook of the OIC Member Countries 2016
27
Table 6: Potential and Actual Size of the Islamic Financial Services Industry
2009 2010 2011 2012 2013 2014 2015
Potential size of the global Islamic financial
services industry (US$ trillion)
4.0 4.4 4.8 5.3 5.9 6.5 7.1
Actual size of the global Islamic financial
services industry (US$ trillion)
1.036 1.139 1.357 1.631 1.813 1.981 2.143
Size gap (US$ trillion) 2.964 3.261 3.483 3.693 4.043 4.47 4.953
Growth in actual size of the global Islamic
financial services industry (%)
26 9.9 19.1 20.2 12.3 9.3 7.3
Average growth rate between 2009-2015 (%) 15
Catch-up period - based on 10% growth in
potential size and 15% growth in actual size
(years)
27
Soruce: GIFR 2016
While some global finance centers are trying to be centers of excellence for Islamic finance, the
Islamic Financial Assets mostly concentrated in the OIC countries. Iran, Malaysia and Saudi
Arabia are the three leading players in the global Islamic financial services industry and only
the UK could rank among the list of top 20 countries in terms of Islamic finance assets (GIFR,
2016).
Box 3. Islamic Finance Country Index- IFCI
As indicated by Islamic Finance Country Index 2016- GIFR 2016 (Box 3), a composite index
utilized for ranking different countries with respect to the state of Islamic financial services
industry and their leadership role in the industry on a national level and benchmarked on
IFCI is based on a multivariate analysis. For construction of the index, data was collected on a number of variables,
including macroeconomic indicators of the countries included. The data was then tested to see if it contained any
meaningful information to draw conclusions from. After consideration of different multivariate methods, it was
decided to use factor analysis to identify the factors that may influence Islamic Banking and Finance (IBF) in the
countries included in the sample.
It must be clarified that IFCI is a positive measure of the state of affairs of IBF and its potential in a country, without
taking a normative view on what should be the important factors determining size and growth of the industry, and
their relative importance (i.e., weights).
The general model used for the construction of IFCI is as follows:
where
Cj = Country j included in the index
Wi = Weight attached to a given variable/factor i
Xi = A given variable/factor i included in the index
The countries are ranked according to the above formula every year, using the annual data.
Source: Global Islamic Finance Report 2016