Islamic finance industry to see positive growth in 2025

Doha, Qatar: The Islamic finance industry is expected to see positive growth this year. Qatar has been cementing its position as leader in the Islamic...

Doha, Qatar: The Islamic finance industry is expected to see positive growth this year. Qatar has been cementing its position as leader in the Islamic finance by leveraging robust regulatory framework and innovative financial solutions.

Strong banking and sukuk industry performance led to 10.6 percent growth for the global Islamic finance industry in last year. The total sukuk outstanding surpassed $1 trillion for the first time, S&P Global Ratings said in a report recently.

In 2025, amid increased uncertainty, positive growth in the industry will continue. “We expect $10bn to $12bn in sustainable issuance in 2025 and continue to think it could drive future growth, although short-term performance might be lower than our initial expectations.”

In GCC countries, “we expect growth to continue thanks to reforms in Oman, Bahrain, and Kuwait, as well as anticipated increases in gas production in Qatar”, the report noted.

 “We expect economic growth in Saudi Arabia and the UAE will continue supporting Islamic banking asset expansion in 2025, barring any significant disruptions from global trade tensions or a further decline in oil prices. In the UAE, the non-oil economy’s performance, along with capital expenditure needs across various sectors will further support financing requirements and sukuk issuances in 2025, assuming current market volatility does not have a major impact.