_Note:_

- a. Issuers in this category include national and state governments as well as state-controlled entities.

- b. Many sukuk issuances, including sovereign/quasi-sovereign, use offshore SPVs (e.g., in the Cayman Islands or New Jersey); thus it is often not immediately apparent from the database where the ultimate obligor is domiciled. Here, we attempt to identify the domiciles of the ultimate obligors.

The multilateral finance institutions have an important role to play in supporting the development of sukuk markets (see table 4). The World Bank Group, through the International Bank of Reconstruction and Development (IBRD) and the International Finance Corporation (IFC), has helped introduce sukuk in some markets and raise their profile in international markets. Both first issued ringgit-denominated sukuk in Malaysia in 2005, and IFC continued to issue in the international capital markets. After its first sukuk issuance in 2003, the Islamic Development Bank (IDB) developed an issuance program that has seen its sukuk issued regularly and in multiple currencies (the U.S. dollar, British pound, Singapore dollar, and South African rand).

Table 4. Sukuk Issuance by Multilateral Institutions

|Institution|Location of Issue/Offer/Listing|
|---|---|
|International Finance Corporation|Dubai, Malaysia, United States|
|World Bank (IBRD)|Malaysia|
|Islamic Development Bank|Frankfurt, London, Malaysia, United Arab<br>Emirates, United States|
|Gulf Investment Corporation|Malaysia|
|International Islamic Liquidity|Luxembourg|
|Management Corporation||

_Source:_ Bloomberg, various sources.

For many issuers, the international markets provide not only access to new types of investors, but also a supportive legal framework. Issuers will be able to select and use the legal framework in a jurisdiction that supports the creation of SPVs and issuance of sukuk. Many international sukuk were issued internationally using SPVs created in tax-friendly jurisdictions such as the Cayman Islands. Some are listed in internationally recognized markets such as London or Dublin. Many sukuk contracts are enforced in internationally recognized jurisdictions such as New York or England.

Sovereign issuers are predominant in the international markets; access to nongovernment issuers remains limited. Preference to sovereign issuers is linked not only to size and credit risk but also to concerns about default resolution that may be more complex for corporate issuers. In the event of default, difficulty may persist in obtaining local enforcement of a foreign court’s decision because of the location of the assets. Thus, investors are mostly comfortable with sukuk under sovereign or quasi-sovereign names. In fact, many corporate issuers in international markets are state-owned enterprises. International investors and rating agencies consider the risks of these entities to be equivalent or near-equivalent to those of sovereign issuers.

The choice of the international market to be considered depends on the target investors and jurisdiction available to these investors. Before issuing sukuk in a market abroad, a potential issuer will need to identify the target investors and the location of issue that is most accessible to them. A sovereign issuer that wishes to tap Islamic investors from different countries may choose an internationally accessible market, such as London or Dubai. However, many Islamic investors may not have convenient access to international markets. In these circumstances, an issuer may choose to 18