The Jordanian Experience in Issuing Islamic Instruments: A Case Study of the National Electric Power Company

Abstract

Islamic instruments contribute to an increase in the volume of financial investments that is positively reflected on the economic activity in the country and helps to increase the effective demand, and, as a result, increase the gross domestic product in Jordan. This study aims to identify the essence of Islamic sukuk and its impact on projects investment in Jordan. Besides, the current study sheds lights on the legal legislations that regulate the process of issuing and circulating Islamic instruments, and reviews the first experience of the process of issuing Islamic instruments, which intended to finance the process of supplying the National Electricity Company with liquefied gas. The study concludes that the process of issuing instruments in favor of the company proved to be an appropriate and economically feasible financing formula. In addition, the demand for Islamic instruments was massive, which indicates the existence of a promising market for it in Jordan. The study recommends expanding the issuance of Islamic instruments to finance public and private capital projects, with the goal of financing the economic development process.