The draft law on sukuk (Islamic bonds) will likely be approved by all the relevant institutions, including the Finance Ministry, the Investment Ministry and Al-Azhar, said newly appointed Finance Minister Al-Morsy Hegazy.
“The first three chapters of the draft law will be approved in a few days,” Hegazy said during a Cabinet press conference on Monday.
The ministry had prepared an earlier draft law that was rejected by the Islamic Research Academy of Al-Azhar. Later, the Shura Council's Economic Committee proposed an updated draft law on sukuk.
The Cabinet’s push to issue sukuk has drawn criticism from religious figures and financial scholars alike, although state officials tout the bonds as the way out of the nation's financial crisis.
At the press conference, Ahmed Mohamed Ali, president of the Islamic Development Bank, said the bank is willing to support the sukuk program. The bank has extensive experience in this regard, and all the programs the bank supports are in agreement with Sharia, he said.
“The Islamic sukuk will attract investment in Egypt,” Ali said.
Minister of Planning and International Cooperation Ashraf al-Araby said that the prime minister has signed five agreements for soft loans worth US$388 million with the Islamic Development Bank to finance the South Helwan power plant, the national program for irrigation, the Al-Azhar Teaching Hospital, the vocational training program and various small enterprises.
Loan repayment is over 15 to 20 years, and the bank has so far financed projects in Egypt for a total of US$8 billion, Araby said.
Edited translation from Al-Masry Al-Youm