CAIRO – Egyptian President Mohammed Morsi has signed a new law allowing the state to issue Islamic bonds — an effort to help ease an expanding budget deficit.
The Islamic bonds, known as Sukuk, are similar to regular bonds but do not have a fixed interest rate, which violates Islamic Shariah law. The move also was a way for Morsi to put an Islamist stamp on the country's economy.
The new bonds that became valid on Wednesday faced a storm of criticism in recent months from both the liberal opposition and ultraconservative Salafis. They feared that by allowing the new bonds, the Morsi government would be opening doors for foreigners to have shares of the country's assets.
However, the final version of the law banned issuing the Islamic bonds for state-owned assets.