President William Ruto has celebrated historic listing of Linzi Sukuk on the Unquoted Securities Platform (USP) of the Nairobi Securities Exchange (NSE).
This event marks the introduction of Kenya’s first Shariah-compliant financial product on the exchange, setting a significant precedent in the nation’s financial sector.
Speaking at the event, President Ruto congratulated Linzi FinCo Trust, the bond’s issuer, for successfully structuring a KSh 3 billion Islamic security with a 15-year maturity.
He highlighted this as a pioneering Public-Private Partnership (PPP) that utilized entirely locally sourced funds through Kenya’s capital markets.
“My recurrent visits to the NSE have each coincided with significant developments crucial for our nation’s economic advancement,” President Ruto noted.
He referenced previous milestones such as the launch of the enhanced NSE Market Place in October 2022 and the introduction of the Laptrust Imara Real Estate Investment Trusts (REIT) in March 2023.
“These are not mere coincidences but reflect a steadfast commitment to fostering a dynamic and inclusive capital market,” he added.
The President emphasized the NSE’s role as a cornerstone in the strategy to mobilize long-term capital, vital for fueling the programs and projects central to the Bottom-Up Economic Transformation Agenda.
He recounted the government’s 2022 pledge to provide land and infrastructure for developing affordable housing, reducing construction costs significantly.
President Ruto praised the private sector’s response to his challenge to create innovative financial instruments supporting national housing and infrastructure projects.
He highlighted that the funds from the Linzi Sukuk would facilitate the construction of 3,069 affordable housing units, generating thousands of new jobs across Kenya.
“The structure of the Linzi Sukuk, aimed at providing housing at an average cost of KSh 1.4 million, enables Kenyans to own homes by paying as little as KSh 7,700 monthly over 15 years,” President Ruto explained. This initiative not only makes homeownership more accessible but also offers a scalable model for investment in affordable housing, attracting long-term investors, including local pension funds.
Read also:William Ruto Nominates Dorcas Odour for Attorney General Position
He also noted the importance of the Sukuk as a financial instrument compliant with Islamic law, promoting financial inclusion and broadening market access. He emphasized the global value of Islamic financial assets, currently estimated at approximately USD 5 trillion.
President Ruto called for developing a robust regulatory framework to support the growth of Islamic finance in Kenya, which he believes has tremendous potential to unlock investment resources and boost economic growth. He highlighted the successful issuance of similar financial products in countries like Nigeria, Egypt, and Malaysia as a promising avenue for diversifying Kenya’s financing sources.
The President reiterated the government’s commitment to achieving a savings-to-GDP ratio of 25-28% by mobilizing savings through capital markets. He outlined ongoing efforts to enhance various capital market instruments, including Initial Public Offers (IPOs), Treasury Bonds, Corporate Bonds, and new products like Green Bonds and Diaspora Bonds.
Additionally, President Ruto discussed the broader economic liberalization policy, including the privatization of government-owned enterprises. He underscored the importance of these reforms in boosting economic performance, developing competitive capital markets, and ensuring a robust, efficient, and transparent financial environment.
