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Imagine a global industry or economy, in these volatile and bruising times, where it is considered a disappointment that growth might drop to single digits this year for the first time in more than a decade.
That industry is Islamic finance, which, having grown at between 10 and 20% pretty much every year of the century to date, may finally be slowing down as it achieves critical mass. Standard & Poor’s – one group expecting growth to slip to merely high single digit – reckons the industry now has more than US$2 trillion in assets.
Mohamed Damak, Global Head of Islamic Finance at S&P, says there are headwinds ahead: the declining oil price, denting economic performance in key Islamic markets; rapid changes in global regulatory frameworks, both in banks and insurance; and the still-fragmented nature of the Islamic finance industry. “Still, Islamic finance will have the impetus to continue progressing and maintain growth,” he says. “We expect the industry will be worth $3 trillion sometime in the next decade.”
