Sudan launches sukuk sale, offers 20 pct return

Reuters, Tuesday 3 Jan 2012

Cash-strapped government announces sale of Islamic bonds at higher-than-usual yields in an effort to raise funds

Sudan, which is fighting a severe economic crisis, has launched a sale of Islamic bonds offering an annual return of 20 per cent to raise funds for the government, according to its debt agency.

Sudan will offer the Islamic bonds, locally known as shahamas, until 25 January, the state-owned Sudan Financial Services Co, which sells sukuk on behalf of the central bank, said in an advertisement published in the local press.
It gave no volume or details of the issue, saying only that the expected annual return would be 20 per cent - higher than around 15 per cent offered on a similar issue in May.
Sudan sells sukuk domestically as a main source of funding as it is denied access to international markets due to the U.S. trade embargo imposed in 1997.
Previous debt issues have been marred by an economic crisis, foreign currency shortages and a devalued currency.
Sudan lost two-thirds of its oil production, the main source of state revenues, when South Sudan became an independent state in July under a 2005 peace agreement.
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