A slice of sukuk from the Big Apple?
On the heels of Prime Minister David Cameron’s announcement that the UK will issue a sovereign sukuk, a New York state senator is passionately making the case that New York needs to be in the sukuk business. “New York is open for business,” said state Senator Kevin Parker, a Democrat from Brooklyn. “I want to see New York, not London, as the next capital of Islamic finance.”
Parker was speaking in his capacity as state senator from New York’s 21st Senate District at the 2013 Islamic Finance Conference in Washington, DC. The conference, whose agenda included sessions exploring everything from how to source Islamic capital in the United States to the relationship between socially responsible investing and Islam, was organized by the Malaysia-US Chamber of Commerce. It was intended to serve as a meeting place for interested parties to come together and advance the cause of Islamic finance in the U.S.
“My understanding of Islamic finance and the role it can play in our economy came from my Muslim constituents in Brooklyn,” Parker said during his prepared remarks. “Other countries, including England, are already in the process of structuring sukuk vehicles to encourage prospective investors and attract capital from overseas. New York should be in that space.”
Umair Khan, counsel for Parker’s office, said that the state senator is actively engaged in promoting sukuk as a public-private partnership in conjunction with the Muslim community in New York. A bill submitted by Parker in the New York State Senate outlines the process for issuing “alternative finance investment bonds,” or AFIBs, a term coined to describe sukuk in a culturally neutral way.
In his remarks during the conference, Parker went on to explain how he sees the Dormitory Authority of the State of New York (DASNY) as well-suited to help structure and issue sukuk in the future. DASNY, which provides financing and construction services to public and private universities, not-for-profit healthcare facilities, and other institutions serving the public good, is a public benefit corporation set up to issue tax-exempt bonds with local communities, he said. Parker argued that his AFIB legislation “reverses an historic inequity where far too many New Yorkers have been unable to benefit from public-private partnerships with the State” because of their religious beliefs.
If Parker has his way, New York won’t just be reversing this trend. It will rival Europe for a bigger piece of the Islamic finance pie.