Journal of Islamic Banking and Finance

Sukuk as a Tool for Infrastructural Development in Nigeria
Majeed Oladele Oladunjoye

Abstract
Islamic finance is a method of financing based on the principles of Islamic law (shariah) and has several structures that can be adopted to suit various means of financing depending on the circumstances including Murabaha, Takaful, Ijarah, Wakala, etc. It has equally been instrumental in the finance of several projects around the word. Lately, several countries which had hitherto not considered this method of financing have been embracing it to bridge their funding gaps. The Securities and Exchange Commission in Nigeria recently promulgated Rules on Sukuk issuance to jumpstart Islamic Finance transactions which facilitated the issuance of the first State Sukuk in Nigeria by the Osun State Government through the Osun Sukuk Company Plc; a wholly owned Special Purpose Company (SPC) of the State. This article examines the potentials for using Islamic finance, particularly Sukuk as a tool for capital raising and infrastructural development in Nigeria and discusses the recent Sukuk issuance by the Osun State of Nigeria under their N60 Billion Debt Issuance Programme. The Structure of the Sukuk, challenges faced during the issuance and other issues are discussed.

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