Malaysia’s govt launches RM500M sukuk to recover economy

PUTRAJAYA, Aug 18, 2020, Malay Mail. Malaysia’s first digital sukuk, the RM500 million Sukuk Prihatin that was launched today, may be subscribed to with a minimum investment of RM500, with no maximum limit, Malay Mail reported.

It was issued following requests from various quarters to contribute towards the country’s economic recovery efforts, said Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz.

He said it may be fully subscribed digitally through JomPAY dan DuitNow.

“The profit rate is two per cent per annum, over two years. This is a competitive rate considering the maturity period is two years.

“Profits will be credited into investors’ accounts on a quarterly basis,” he said in his speech at the launch of the Sukuk Prihatin here witnessed by the Yang di-Pertuan Agong Al-Sultan Abdullah Ri’ayatuddin Al-Mustafa Billah Shah, who also consented to become the sukuk’s first investor.

Also present was Prime Minister Tan Sri Muhyiddin Yassin.

A statement from the Finance Ministry said the sukuk may be subscribed to from today until Sept 17, with profits to be paid on a quarterly basis and exempted from tax.

It said the sukuk, for which Maybank is the main distribution bank, is a shariah-compliant instrument based on the principle of Tawarruq via the Commodity Murabahah arrangement, and is open to Malaysian citizens aged 18 years and above.

Tengku Zafrul said the Sukuk Prihatin is one of the initiatives under the National Economic Recovery Plan (PENJANA) launched by the prime minister on June 5.

“In the government’s six-pronged strategy, the plan comprises six approaches, namely Resolve, Resilience, Restart, Recovery, Revitalise and Reform, and proceeds from the sukuk will be used for the fourth approach ie. Recovery,” he said, adding the hope is that the sukuk would be able to help efforts to safeguard the well-being of the target groups.

Meanwhile, Muhyiddin in his speech, said proceeds from the sukuk will be channelled to Kumpulan Wang Covid-19 to finance programmes that benefit those affected by Covid-19, including improving connectivity for rural schools, financing micro SMEs especially women entrepreneurs, and supporting grants for research into infectious diseases. ― Bernama