Brunei Darussalam reached yet another milestone with the country attaining a spot among the top 10 performing Islamic finance markets in the ICD-Thomson Reuters Islamic Finance Development Report 2017, published recently.

With a score of 47 in the Islamic Finance Development Indicator (IFDI), Brunei rose to ninth position this year from last year’s 14th position with 23 points, registering a 104 per cent increase, and surpassing Qatar and Indonesia.

Malaysia is the best performer in the category with total score of 129, while Bahrain (83) and the UAE (64) are ranked second and third respectively.

The Islamic Finance Development Indicator provides rankings and profiles for different Islamic finance markets around the world, drawing on instrumental factors grouped into five broad areas of development as the main indicators, namely Quantitative Development (Islamic Banking, Takaful, Other Islamic Financial Institutions, Sukuk and Islamic Funds), Knowledge (Education and Research), Governance (Regulations, Syariah Governance and Corporate Governance), Corporate Social Responsibility (CSR Activities and CSR Funds Disbursal) as well as Awareness (Seminar, News and Conferences).

The indicator does not just focus on the overall size and growth of Islamic finance sectors in different countries; it instead evaluates the strength of the overall ecosystem that assists in the development of the industry.

His Royal Highness Prince Haji Al-Muhtadee Billah ibni His Majesty Sultan Haji Hassanal Bolkiah Mu’izzaddin Waddaulah, the Crown Prince and Senior Minister at the Prime Minister’s Office in his capacity as the Chairman of Autoriti Monetari Brunei Darussalam (AMBD) Board of Directors launched the Brunei Darussalam Islamic Investment Summit and the Brunei Darussalam Islamic Finance Website and Mobile Application in 2017. These are some of Brunei Darussalam’s initiatives that contributed to the 410 per cent increase in the Awareness Indicator to 51 points, from 10 points in 2016, the report noted.

The Sultanate’s other significant development is in the Knowledge Indicator, which increased by 154 per cent from 22 to 56 points. The report attributed this to the involvement of higher education institutions and Islamic finance institutions in supporting Islamic finance activities in Brunei Darussalam.

Brunei Darussalam also registered a 116 per cent increase in Quantitative Development.

According to the report, the most improved performances were by Indonesia and Brunei.

Indonesia’s rupiah, like the ringgit, was impacted by the US election, but a rebound in the currency by the end of 2016 contributed to growth in Indonesia’s total Islamic finance assets. Another contributor to the country’s growth was an increase in Indonesia’s Sukuk outstanding following a rise in Sukuk issuance. Knowledge and Awareness indicators also showed improvement.

Brunei was the biggest gainer in Southeast Asia as it improved across all indicators and its much smaller size compared to Indonesia affected its rationalising coefficients, the ICD- Thomson Reuters report said.

Thomson Reuters is a premier global provider of intelligent information to leading decision markers in the financial, legal, tax, accounting, intellectual property, science and media markets.

Islamic Corporation for the Development of the Private Sector (ICD) is a multilateral development financial institution within the Islamic Development Bank (IDB) Group.