Senegal: €152m Islamic bond debt postponed until further notice
The Senegalese government has postponed the launch of an Islamic bond debt (Sukuk) to be issued on the sub-regional market at the beginning of 2012 by the Senegal Islamic Bank (BIS).The Senegalese government has postponed the launch of an Islamic bond debt (Sukuk) to be issued on the sub-regional market at the beginning of 2012 by the Senegal Islamic Bank (BIS).
It committed to issue this bond debt to leverage CFAF 100 billion (€152.5 million) on a borrowing volume of more than CFAF400 billion at financial institutions, Les Afriques newspaper reports.
However, it failed to harness Arab capital flows to finance the development of this mechanism in Senegal.
Islamic finance struggles to develop in West Africa. "The UEMAO space, a remarkable example of economic integration, represents less than 0.01 percent of this Islamic finance market despite an important demand," director of the African Institute for Islamic Finance Mouhamadou Lamine Mbacké told APS news agency.
According to Islamic microfinance expert Mansour Ndiaye, Senegal still struggles to provide a base for important Islamic finance structures because of a lack of tailor-made regulations, Le Quotidien reports.
He believes Senegal is still "lagging behind", due to the lack of political will to boost the sector.
"The major questions remains the legal frame. The market exists, but as long as there is no legal frame, there will never be any financing," he said.