The UAE has launched an initiative to allow individuals to invest in Sharia-compliant government bonds as it aims to expand its investor base.
The minimum investment in government-backed treasury sukuk (T sukuk) is Dh4,000 ($1,089.17) and is open to Emiratis and residents, Wam reported on Friday. Previously, only institutional investors were allowed to invest in government bonds.
“Through this initiative, the Ministry of Finance seeks to transform investment in government bonds into an accessible, comprehensive digital experience, enabling all segments of society to access high-quality financial instruments that were previously limited to institutional investors,” Sheikh Maktoum bin Mohammed, First Deputy Ruler of Dubai, Deputy Prime Minister and Minister of Finance of the UAE, said.
“This represents a strategic step towards advancing financial inclusion and promoting a culture of long-term savings, ensuring the sustainability of the UAE’s financial resources and supporting development goals across various sectors.”
Individuals can invest in T sukuk though participating banks, with the name of the first bank to be announced on November 3.
The Ministry of Finance raises money for the federal government through the issuance of dirham-denominated treasury sukuk.
In July this year, it raised Dh1.1 billion through the initiative, with a strong response from investors. The T sukuk was oversubscribed nearly five times and the order book exceeded Dh5.35 billion.
“The ‘Retail Sukuk’ initiative represents a qualitative leap in the development of government investment instruments, enhancing individual participation in economic growth and providing a direct avenue to contribute to the national development journey,” Mohamed Al Hussaini, Minister of State for Financial Affairs, said.
The UAE economy is projected to outperform the global average this year as it is expected to remain resilient to uncertainty in the global economy, the International Monetary Fund said this month.
The IMF projects the UAE's gross domestic product (GDP) to expand at a 4.8 per cent pace this year, driven by strong non-hydrocarbon growth and Opec production increases, before expanding at a further 5 per cent rate in 2026.
The fund's growth projection is slightly below the UAE Central Bank's forecast for this year of 4.9 per cent.
