A right group, the Muslim Rights Concern (MURIC) has charged the Federal Government to extend the deadline for the bid for the first Sovereign Sukuk to Dec. 31, 2014.
In a press statement signed by its President, Prof. Ishaq Akintola, MURIC said six days notice was rather too short for a new money market facility of that kind.
It wondered why the Federal Government first Sukuk (non-interest lease assets facilities), issued on Thursday, Sept. 14, to close on Wednesday, Sept. 20, would be available for only six days., since it expires on Wednesday 20th September.
While commending the government for the historical development, the human rights group, Akintola berated the Central Bank of Nigeria (CBN) for giving short notice to the Sukuk savings window, when interest based bonds and shares are left open for months.
“The Federal Government (FG) issued its first Sukuk (noninterest lease assets facilities) last week (on Thursday 14th Sept. 14, 2017). Surprisingly, it will be available for only six days as it expires tomorrow, Wednesday, Sept. 20.
“Although we commend FG for this historical development, we are disturbed by the short notice of the savings window. The Central Bank of Nigeria (CBN) goofed by giving six days only as the deadline when interest based bonds and shares are available for months before the closing date.
“The Central Bank of Nigeria (CBN) goofed by giving six days only as the deadline when interest based bonds and shares are available for months before the closing date.
“Six days notice is rather too short for a new facility. Afterall, Muslim Finance experts have for several decades been calling for noninterest financial instruments like the sukuk and FG needs to give this first chance a longer time until people get used to it.
“Afterall, Muslim Finance experts have for several decades been calling for noninterest financial instruments like the sukuk and FG needs to give this first chance a longer time until people get used to it,” the statement read in part.
The group noted that although it was advertised in one or two newspapers, the federal government needed to do better than that.
“A massive media publicity involving all media houses (print and electronic) is necessary for this first outing while the CBN should involve all banks.
“There is no sign at all that the banks are aware of sukuk or that they are cooperating. CBN should have known better. Or is the sukuk deliberately designed to fail? Is there an anti-Muslim sentiment behind this?
“Or is the sukuk deliberately designed to fail? Is there an anti-Muslim sentiment behind this?
MURIC stated that the apex bank should not only keep the investment window open for at least six weeks, all agency banks should be directed to publicise the product throughout all their branches.
It also wanted the CBN and the Federal Ministry of Information to give maximum possible publicity to the new facility.Nigeria needs this financial instrument as a new initiative to complement its efforts at emerging from the present economic quagmire.
Nigeria needs this financial instrument as a new initiative to complement its efforts at emerging from the present economic quagmire.
According to MURIC, the economic magazine, `The Economist’, once described Islamic Finance as the tipping point while the London Stock Exchange listed its first ever Sukuk ten years ago (April 2007).
“Nobody should tell us that he is better in economic matters than the British and their shrewd banks.
“The the Middle East and Asia are the two fastest-growing areas of the world in economic development and sukuk has been held largely responsible for this phenomenon.
“The CIMB Group Holdings has affirmed that Islamic Finance is the fastest growing section of the world’s financial system.
“Presently, Islamic banking is practised in 300 different financial institutions in more than 52 countries including the United States and Britain.
“The involvement of Nigerian banks will give them the opportunity to bite their own mouthfuls from more than $822 billion in assets being managed by Islamic banks worldwide.”
MURIC said it expected the CBN to know all these facts and be aware of the advantages of sukuk and its preference in modern financial institutions.
It urges Nigerian banks to avail themselves of this window, noting “Sukuk is growing speedily in Western banks.
“Conventional banks are now scrambling to set up Shari’a-compliant operations in the Europe and America; a flurry of all-Islamic start-ups, from full-service investment banks to specialist advisory firms and their products have moved beyond lending, insurance and investment funds to include sukuk.
MURIC charges FG to extend the sukuk’s deadline to the end of Dec. 31, 2017.
“We suggest that a robust publicity should be embarked upon between now and the proposed December 31st ultimatum.
“No serious nation plays with its economic survival and diversification of investments is one of the best means of achieving this.
By Adeyinka Aremu