AlHuda Centre of Islamic Banking and Economics (CIBE) served as the Shariah advisor for the successful issuance of the CRDB–Albarakah Multicurrency Sukuk in Tanzania. The issuance, structured on the basis of Ijarah, was approved by the Capital Markets and Security Authority (CMSA) and the Dar Es Salaam Stock Exchange (DSE) for listing, marking a significant development in the Islamic capital markets of East Africa.
The CRDB–Albarakah Sukuk was launched with a multicurrency structure, allowing subscriptions in both Tanzanian Shillings (TZS) and US Dollars (USD).
The Sukuk is a Shariah-compliant financial instrument backed by tangible leased assets under an Ijarah (leasing) structure, ensuring that all returns are derived from asset-based transactions rather than interest. This aligns with the standards of the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI).
The instrument has a tenor of five years and offers returns of up to 12 per cent per annum for the TZS tranche and six per cent per annum for the USD tranche, with payments made quarterly. The minimum subscription amount was set at TZS 500,000 and $1,000, making it accessible to a wide range of local and international investors.
Muhammad Zubair, chief executive officer of AlHuda CIBE, commented on the issuance: “This is a pioneering initiative that demonstrates the growing role of Islamic finance in Tanzania and the wider East African region. By structuring this Sukuk on the basis of Ijarah, CRDB has ensured that investors gain access to a secure, transparent, and ethical investment avenue. Importantly, the multicurrency structure widens participation, attracting both domestic and international investors.”
The growing global Sukuk market
Zubair also provided context on the global Sukuk market, noting that it grew from $904.5billion in 2023 and is projected to reach $2,160.55billion by 2028. Annual issuance stood at $197.8billion in 2023 and $193.4billion in 2024, with expectations of $190–$200billion in 2025.
Foreign currency-denominated Sukuk surged by 29 per cent to $72.7 billion in 2024, largely driven by Saudi Arabia, Malaysia, and Indonesia. Meanwhile, sustainable Sukuk issuance increased to $11.9billion in 2024, with Saudi Arabia accounting for 38 per cent of the total.
Wider economic impact for Tanzania
The multicurrency Sukuk issuance is expected to carry significant benefits for the wider Tanzanian economy. By mobilising long-term, Shariah-compliant funding, the Sukuk supports CRDB Bank in expanding its financing capacity, which in turn helps channel capital into productive sectors of the economy.
For the Government of Tanzania, the initiative helps to deepen the domestic capital market, attract foreign investment through its multicurrency feature, and diversify funding sources beyond conventional instruments. The announcement also highlighted the role of the Sukuk in strengthening financial inclusion by offering faith-based investment opportunities and positioning Tanzania as a potential regional hub for Islamic finance.
