JAKARTA, KOMPAS.com – Indonesia’s Islamic finance assets reached 1,862.7 trillion rupiahs ($128.3 billion) as of March 2021, or equivalent to 9.96 percent of the total financial assets, a top official said.
“From the aspect of assets, the sharia financial sector in Indonesia grew strongly reaching 1,862.7 trillion rupiahs ($128.3 billion) in March 2021,” Finance Minister Sri Mulyani Indrawati said during an online discussion on Thursday, July 15.
Sri Mulyani said the development of the global Islamic finance assets has contributed to the sharia financial sector in Indonesia. Currently, the volume of Islamic finance assets continues to increase from $2.52 trillion to $2.88 trillion, while global Islamic finance is expected to grow by five percent in the 2019-2024 period with assets reaching $3.69 trillion.
Indonesia, she added, needs to strengthen the resilience of its Islamic financial sector, including its shares in the capital market. "Indonesia must be able to play the roles in various developments and progress in the sharia economy following the increasing aspirations of the people to obtain sharia-based instruments," said Sri Mulyani.
However, the minister said, the Covid-19 pandemic could affect the development of the capital market. The Global Islamic Economic Report 2020 pointed out that there was stagnation in the development of Islamic finance assets in 2020. Even though in 2019, Islamic finance assets experienced an increase of 13.9 percent.
In Indonesia, the assets of corporate sukuk (sharia-compliant bonds) and sharia mutual funds are still low. On June 25, the outstanding position of corporate sukuk only reached 32.54 trillion rupiahs ($2.2 billion) with a market share of 7.44 percent.
The sharia mutual funds could only reach a value of 39.75 trillion rupiahs ($2.7 billion) with a market share of about 7.28 percent. "With a small base, it is hoped that developments can continue," said the minister.
For the development to continue, the minister said the government will work together with Bank Indonesia (BI) and the Financial Services Authority (OJK) to develop the Islamic financial market, pursue policies, and regulations as well as the creation of instruments.
She said the development will be continued. As of June 2021, data from the OJK showed that sharia stock assets reached 3,372.2 trillion rupiahs ($232.7 billion) or equivalent to 47.32 percent of the total Indonesian stock price index.
"The government is committed to developing the Islamic capital market by increasing the depth and liquidity of the Islamic financial sector. This is manifested by the issuance of state sharia securities or state sukuk," she said.
(Writer: Fika Nurul Ulya | Editor: Erlangga Djumena)