South Africa plans to tap existing rand sukuk bonds this year

South Africa will tap existing rand-denominated sukuk bonds as part of its funding plans for the current fiscal year.

We are “on track to tap the existing sukuk instruments, subject to the completion of the required hybrid structure and internal approval processes,” the National Treasury said in an emailed response to questions.

“Details regarding the targeted issuance size and the timing of the tap will be communicated closer to the issuance date.”

South Africa last tapped the Islamic-debt market in 2023 — the first sukuk sale in almost a decade — when it raised R20.4 billion ($1.2 billion). The offering drew almost double the amount sought.

“The taps could help improve liquidity gradually in the sukuk instruments given that their outstanding issuance is still modest,” said Samir Gadio, head of Africa strategy at Standard Chartered Plc.

“Improved liquidity will be key to broaden the appeal of these instruments to the