Date of Award

2010

Thesis Type

Masters

Document Type

Dissertation

Divisions

Academy of Islamic Studies

Department

Department of Shariah, Economics and Governance (formally known as Dept of Syariah & Economics)

Institution

Universiti Malaya

Abstract

Sukuk Ijarah is one of the financial certificates known in the Islamic capital market. This financial certificate is established by taking into consideration two major factors, firstly, preserving the conventional way of investment which is permissible in Islam and, secondly, conforming to the shariah law, as a new financial instrument in the Islamic capital market. Sukuk and Bond are two different instruments in its financial structure. Sukuk eliminates in its structure the use of riba and gharar (uncertainty). Moreover, its financial structure is based on Islamic securitisation concept and exchange contract, such as ijarah, murabahah, bay‘ bithamin ajil and others. The underlying shariah principles in these Islamic exchange contracts form the new Islamic debt instrument, such as Sukuk Ijarah. Sukuk Ijarah represents rented assets that might be used as a new financial asset for fixed investment tool. Although it was taken from shariah principle, the conventional method accepted by shariah is permissible such as the tendering system, rebate and late payment charges. Sukuk Ijarah evolves from early ija rah principle, which is practically a method use by previous Moslems to fund their economic activities. There are narrated hadis on the allowable of such deed but must be made clear and no underlying mischief acts. At that point of time, the ijarah principle is more in the form of rent or lease operations but today, this concept has develop into an Islamic financial leasing activities. In Malaysia, the issuance of Sukuk Ijarah by private sector rise from 2% to 11% in 2005 to 2007. The increase is due to the new development of Sukuk certificates using various ijarah principles such as ija rah muntahiyah bitamlik and ijarah mausufah fi dhimmah. There is a need to study and explain the development of new Sukuk certificates based on ijarah principles and how these concepts can be applied in the Islamic capital market, in particular, Malaysia.

Initial

khm

Additional Information

Dissertation (M.A.) – Academy of Islamic Studies, Universiti Malaya, 2010.

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