President Ibrahim Mohamed Solih says the next six months would still prove difficult for the whole country and that the government has decided to sell Sukuk (Islamic Financial Certificate) worth USD300 million to shore up
Last year, addressing the Parliament’s budget committee, Finance Minister Ibrahim Ameer had said that the government was working to sell samurai bonds to Japan.
But yesterday, while speaking to reporters President Solih said the government had halted the transaction and said that this was due to the Covid-19 crisis.
He said that the government has now turned its focus on selling a USD 300 million Sukuk and that work is now underway.
A Sukuk is an Islamic financial certificate, similar to a bond in Western finance that complies with sharia law. Sukuk involves asset ownership while bonds are debt obligations.
Also, the President said that the country’s credit ratings were previously graded a B rate but has now dropped to a –B rate.
But he said that many countries were in the same predicament and international financial institution Moody’s has assured the credit downgrade was due to the Covid-19 crisis.
President Solih said that the government can sell the USD 300 million Sukuk at a reasonable rate and if it is successful in selling it then the government can manage its finances comfortably for the next 6 months.
