ASTANA, Kazakhstan, October 11. The potential size of Islamic financial assets in Central Asia may reach $10 billion by 2030-35, Trend reports, referring to the statement of the Eurasian Development Bank on the sidelines of The 2023 Annual Meetings of the World Bank Group and the International Monetary Fund (IMF).
"The EDB is currently actively expanding cooperation with GCC financial institutions to promote the development of Islamic finance in Central Asia; in particular, we are collaborating with the organizations of the Islamic Development Bank Group," the statement said.
As was noted, the EDB has also created an Islamic finance division.
"In 2024, the Bank is considering issuing $500 million worth of sukuk (is a sharia-compliant bond-like instruments used in Islamic finance) in international markets to finance projects in Central Asia, which could become a benchmark for Central Asian countries. The list of potential projects that the financing can be directed to has already been formed," the statement said.
Regarding the countries of Central Asia, the statement says that the EDB member countries Kazakhstan, Kyrgyzstan, Tajikistan are predominantly Muslim republics. Therefore, Shari'ah compliant financing is becoming more and more in demand with each passing year.
"As of the end of 2021, Islamic assets accounted for 0.2 percent of all banking assets in Kazakhstan. Kazakhstan is the leader of Islamic finance development in Central Asia in terms of assets. The country accounts for 68 percent of the total volume of Islamic banking assets in the region, which can be explained not only by the size of Kazakhstan's economy, but also by the relative consistency of the approach to the formation of the Islamic finance sector the country is currently implementing. In 2009 – 2015, Kazakhstan adopted legislation regulating the main areas of Islamic financial activity – banking, financial market, insurance – and issued Islamic bonds," said the statement.
The Eurasian Development Bank (EDB) is an international financial institution investing in Eurasia. For more than 17 years, the Bank has worked to strengthen and expand economic ties and foster comprehensive development in its member countries.
The EDB's charter capital totals $7 bln. Its portfolio consists primarily of projects with an integration effect in transport infrastructure, digital systems, green energy, agriculture, manufacturing, and mechanical engineering. The Bank’s operations are guided by the UN Sustainable Development Goals.