FINANCIAL TIMES: The British government will announce on Monday that it is set to become the first western state to issue Islamic bonds, seeking to meet what it believes is a significant demand for this financial product both inside and outside the UK.
In what ministers believe will be an important gesture to Britain’s Muslim community, the Treasury will say Monday that it is paving the way for the launch of the first Sharia compliant UK government bonds by 2008.
The move, to be announced by Ed Balls, the City of London minister, is unprecedented by any western state.
Sharia compliant bonds have hitherto been issued by the governments of Pakistan and Malaysia and also by corporate issuers around the world, but never by a western state.
The UK will not only be looking to issue these government bonds on wholesale financial markets. It will also be looking at using Sharia compliant bonds to allow Muslims in Britain to invest in domestic National Savings products through banks and post offices. UK to issue west’s first Islamic bonds (Read on) by James Blitz and Gillian Tett
Mark Alexander
