Socioeconomic notes of Casa Árabe
142024
The Expansion of Islamic Finance Globally: Opportunities in Europe and Spain Report published by the Observatory of Islamic Finance in Spain SCIEF-Casa Árabe The Observatory of Islamic Finance in Spain SCIEF - Casa Árabe, serves as a premier hub for analysis and consultation regarding the current state of Islamic finance in Spain. Established by Casa Árabe and the Saudi-Spanish Center for Islamic Economics and Finance (SCIEF) at IE University, it publishes this socio-economic update about the latest developments and trends within the global Islamic finance sectors and markets, spanning various regions and countries, including North Africa, Europe, and Spain. It also highlights those markets where Islamic finance has reached significant structural influence and identifies opportunities for Spanish enterprises. In recent years, Islamic finance has undergone remarkable growth in both volume and geographical terms, showing its resilience and efficacy in providing tailored financial solutions to meet the demands of contemporary economic realities across diverse sectors and markets. Within the European landscape, Islamic finance presents avenues for development, intersecting with one of the most rapidly expanding sectors: ESG criteria (environmental, social, and governance). Moreover, as Islamic finance gains systemic prominence in numerous countries, companies operating within these regions increasingly require expertise in Islamic financial products to navigate effectively. The economic diversification initiatives in the countries of the Gulf Cooperation Council (GCC) and the burgeoning growth observed in Southeast Asia are paving the way for business opportunities that necessitate companies to align their projects with Islamic finance principles or leverage them to finance their ventures.
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In recent years, Islamic finance has experienced remarkable growth in both volume and geographic expansion. The total pool of Islamic financial assets reached an estimated total value of USD 4.5 trillion in 2022, which is expected to increase to USD 6.7 trillion by 2027 (ICD 2023), which gives evidence of
Chart 1. Total Assets in Islamic Finance (Billions of USD)
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Islamic finance in the world
Source: ICD - LSEG Islamic Finance Development Report 2023