DOHA: Doha Bank chief executive officer, R Seetharaman has said Islamic securities are fast emerging as an essential source of financing and liquidity management in view of the huge demand for project financing.
In five years of their existence the sukus have grown and are estimated at $50bn globally, he said at a seminar organised by Doha Bank on “GCC Economic Trends and Business Opportunities” in Tokyo at the weekend.
The Islamic securities market is set to grow exponentially, as the project financing requirements for the Gulf region alone is exceeding $1tn.
Seetharaman said “Islamic banking is an ethical and equitable mode of financial services, based on Sharia, whose main features are prohibition of interest, gambling or speculation. It is based on the principle of profit sharing. Islamic banking is a young industry witnessing around 20% growth. Today we have globally more than 300 Islamic financial institutions, with total estimated size of $700bn. Islamic Banking products and services are available for all activities in different stages of life cycle of an individual as well as a corporate entity.”
On how the GCC economies have transformed over a period of time, he said, “Economies all over the world are attempting to leverage through collaborations, free trade agreements, efficiency building and reforms to improve the investment attractiveness of their countries. In this environment, GCC has emerged as a role model for transformation on economic and social fronts. GCC countries have been able to generate considerable fiscal surplus consistently, making it the fastest growing bloc in terms of GDP with national income averaging about 20% growth.
“The per capita income of GCC countries is amongst the highest today witnessing 15% overall growth. GCC has been prudently deploying the surpluses towards multi sector development that has changed the face of GCC completely during last two decades. With increasing degree of openness in investment, trade and commerce policies, rapid pace of development, private sector role enlargement, the project financing requirement exceeds $1.2tn in next five years. GCC provides tremendous opportunities for investment.”
About developments in Qatar, one of the fastest growing economies in world, Seetharaman said it was making incredible strides in energy, tourism, infrastructure, education, health and sports.
Some of the topics discussed at the seminar were “GCC economic trends and business opportunities”, “Islamic finance prospects” and “Global warming and climatic changes”. It was attended by diplomats, government dignitaries, and others