Turkey to play 'important role' in sukuk market despite paused UAE deal

Although Turkey has reportedly suspended plans to go through with a $8.5 billion sukuk deal with the United Arab Emirates, the sector head at S&P Ratings Agency expects Ankara to remain an active player in the market.

Sukuk are Islamic bonds arranged in shariah-compliant structures. For decades, they have been a popular tool for governments and companies to raise capital. 

Bloomberg reported Monday, citing sources familiar with the matter, that Ankara had decided to pause a planned sukuk issuance with the UAE sovereign wealth fund Abu Dhabi Development Holding Co PJSC (ADQ). The report said the Turkish government believed that the yield demanded by ADQ was “unfavorable” and that the deal had not been ruled out completely and may close at a later date.

Neither ADQ nor the Turkish Treasury responded to a request for comment.