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The role of the stock market in the provision of Islamic development finance: Evidence from Sudan

Author

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  • Hearn, Bruce
  • Piesse, Jenifer
  • Strange, Roger

Abstract

This paper assesses the impact of stock exchange funding in the Shari'ya compliant Islamic economy of Sudan. Evidence suggests that while Islamic financial instruments have considerable potential in facilitating development finance through their emphasis on partnership this is better achieved by the banking system rather than the Khartoum Stock Exchange. A case study of the Sudan Telecommunications company shows that larger firms able to cross-list elsewhere are likely to choose regional markets in preference to their domestic one thus benefiting from lower costs of equity. However, governance preferences are likely to favour block shareholders following the Islamic finance partnership concept.

Suggested Citation

  • Hearn, Bruce & Piesse, Jenifer & Strange, Roger, 2011. "The role of the stock market in the provision of Islamic development finance: Evidence from Sudan," Emerging Markets Review, Elsevier, vol. 12(4), pages 338-353.
  • Handle: RePEc:eee:ememar:v:12:y:2011:i:4:p:338-353
    DOI: 10.1016/j.ememar.2011.04.004
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    References listed on IDEAS

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    1. repec:eee:intfin:v:50:y:2017:i:c:p:135-155 is not listed on IDEAS
    2. Asongu, Simplice, 2015. "Financial development in Africa - a critical examination," MPRA Paper 82131, University Library of Munich, Germany.
    3. Scott J. Niblock & Panha Heng & Keith Sloan, 2014. "Regional stock markets and the economic development of Southeast Asia," Asian-Pacific Economic Literature, Asia Pacific School of Economics and Government, The Australian National University, vol. 28(1), pages 47-59, May.
    4. Maurizio Polato & Josanco Floreani & Andrea Paltrinieri & Flavio Pichler, 2016. "Religion, governance and performance: evidence from Islamic and conventional stock exchanges," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 20(3), pages 591-623, September.
    5. Ajili, Wissem & Gara, Zeineb Ben, 2013. "Quel Avenir Pour La Finance Islamique En Tunisie ?," Etudes en Economie Islamique, The Islamic Research and Training Institute (IRTI), vol. 7, pages 31-70.

    More about this item

    Keywords

    Sudan; Islamic finance; Emerging financial markets;

    JEL classification:

    • N25 - Economic History - - Financial Markets and Institutions - - - Asia including Middle East
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • P45 - Economic Systems - - Other Economic Systems - - - International Linkages

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