The Application of Islamic Sukuk in Jordan: Possibilities and Challenges
Keywords:Islamic Sukuk, financial system, Investment instruments, underwriting
The issuance of Islamic Sukuk Law in Jordan is a step in the right direction for the liberation of the financial system from the predominance of an interest-based financial system than just a creditor to be participants in economic activity also provides opportunities for individuals who are eager to invest in Islamic financial instruments and as an engine of the Jordanian economy. Through the studying some of the economic and financial indicators in Jordan for the period from (1998 - 2012), the study found a positive indicators support the idea of Sukuk Islamic such as the relatively high rates of savings and bank deposits as a percentage of GDP, which means providing the necessary funding for the underwriting of these instruments. But there are other indicators put this idea in a challenge in terms of its acceptance or its continuity by the financial system and investors due to the lack of confidence in the economy and to the high ratio of public debt and public deficit. Moreover, the penetration of interest-based system in the economy and the absence of efforts seriousness in fighting corruption are also another serious challenges. With all this, the activation and issuance of laws governing the reform of the financial system ,anti-corruption and increasing transparency will enhance the confidence of investors in order to accept financing of Islamic derived investments .moreover ,it necessary to be screened the experiences of other Muslim and non-Muslim countries who apply Islamic securitization and introduce them with these products and their characteristics to stimulate the economic sectors to accept this Islamic project.
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