Sukuk Shehama is a financial instrument that has only recently emerged. It is a form of government-issued Islamic Bond (Sukuk) based on Musharakah which is found in Sudan but can be easily replicated in any other country. Each certificate carries a nominal value that is calculated in dinars and represents a share of the net investment allocated by the government for this purpose from the selected investment units.
Shehama certificates are issued at different times from 6 months to one year. These certificates are issued in multiple categories 50 thousand dinars – 100 thousand dinars – 200 thousand dinars – 500 thousand dinars so that different categories of investors can buy any number of certificates of any amount. The profit is distributed to the owners of the certificates based on their shares in the net equity over the period of the partnership.
Some of the features of the Shehama Certificates is that: the certificate is legitimate and fulfils all the requirements of Shariah contracts. Moreover, it is invested in low-risk investment as it is anchored in assets in economic units characterized by high profitability and distinct management in different economic sectors. In addition, it can be liquidated through selling it at any time. For now, it can be done so at the Khartoum Stock Exchange. Furthermore, it can be used to settle financial transactions as a guaranteed payment method. Shehama Certificates can be acquired by banks, investment funds, insurance companies, as well as the general public interested in saving and investing.
Purpose and Scope
The main objective of issuing Shehama Certificate is to enhance liquidity management at the macroeconomic level through what is known as open market operations by controlling liquidity either domestically or under Islamic law. Moreover, to cover part of the deficit in the budget if it is usual to cover the printing of cash or so-called indebtedness of the inability of the Central Bank as the printing of these papers has an inflationary effect on the national economy. In addition, it contributes to national savings and encourages investment by spreading savings awareness among the public, which in turn leads to increased investment. Furthermore, it creates Islamic securities that serve as a nucleus to help develop local capital markets.
Impact of Shehama
Shehama has a great impact on both economic and social development. With reference to economic impact, it can help in financing the deficit in the government budget since its issuance. It also partially helps in reducing the inflationary impact of other financing options by providing stable funding to the government that is highly linked to the real sector. Moreover, it can finance many development projects, especially in the medical sector. Furthermore, it can help develop capital markets.
Regarding the social impact, Shehama can help the masses in terms financing small projects or paying school fees, or medical bills besides acting as a saving channel for individuals that helps them during emergencies, and very importantly, retired persons, for whom it can serve as a sustainable source of income.
By Assoc. Prof. Dr. Magda Ismail Abdel Mohsin
*This article first appeared in Wahed Invest Journal on 30 January 2019.
**Available on INCEIF Knowledge Repository (IKR): https://ikr.inceif.org/handle/INCEIF/3059