The Impact of Sukuk Investment in Developing the UAE Economy

Sukuk is an integral part of Islamic economics and finance. It is an excellent source of funding for governments or companies who are craving for Shariah compliant tools which can foster the economic growth. The governments around the globe have taken deep interest in issuing and promoting Sukuk as the mainstream financial tools and the government of UAE particularly Dubai government has taken the lead in ensuring the emirate being one of the first adapters of Sukuk development in order to diversify its economy. Conventional bonds pay ¿interest¿ and may finance businesses involved in non-Sharia-compliant activities. Sukuk are structured to comply with Shariah by paying profit instead of interest. This is achieved by involving a tangible asset in the investment. The UAE has recorded substantial success in the implementation of Sukuk to the extent that they are poised to become the center of Sukuk trading globally. Such UAE substantial successful implementation of Sukuk can benefit Sukuk issuance in Nigeria, by cconsidering the huge infrastructural gap facing Nigeria and the challenges being faced by the Federal Government due to steep decline in oil revenue.