News – By administrator on Wednesday, February 23, 2011 – 04:06

KUALA LUMPUR: Malaysia’s economy is expected to expand 6% this year on measures to ensure private consumption and overall support for growth.

Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz said the country would meet this year’s gross domestic product (GDP) growth target of between 5% and 6%.

The GDP expanded 7.2% last year following a 1.7% contraction in 2009.

Tan Sri Dr Zeti Akhtar Aziz

“We have a high degree of confidence that GDP will be within that range,” Zeti told reporters yesterday following the launch of Bloomberg LP‘s Islamic Finance Platform.

Meanwhile, Zeti said in her speech that global sukuk issuance for this year was expected to surpass 2007’s, which saw US$40bil issued while 2010’s surpassed the previous year’s by more than 20%.

She said Malaysia’s evolution as a multi-currency sukuk origination platform, where there were already four foreign-currency sukuk issuances amounting to US$3bil last year, would benefit from a ringgit-denominated index for government securities developed by Bloomberg together with the Association of Islamic Banking Institutions Malaysia (AIBIM) and Bursa Malaysia.

Called the Bloomberg AIBIM Bursa Malaysia Sovereign Syariah Index, Zeti said it would measure the performance of ringgit-denominated syariah-compliant government securities in addition to benchmarking purposes.

“The collaboration between AIBIM, Bursa Malaysia and Bloomberg is also expected to see a ringgit corporate sukuk index in the offing. Moving forward, efforts are under way by Bank Negara and Bloomberg to broaden this initiative to develop a foreign-currency sukuk index,” she said.

According to AIBIM representative Mohamad Zabadi Ahmad, sukuk issuance this year was expected to touch RM90bil with five new issuances and six reopening issues.

He said at a briefing that there were RM81.5bil in outstanding government-issued sukuk with RM45bil maturing this year.

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