Brazil gets first shariah-compliant investment

The premium residential project, from property developer Ritz-G5, is the first independent investment product to be eligible for Shariah-compliant funding. Previously, Islamic funds in Brazil have primarily been the domain of equity houses and banks such as Banco do Brasil SA.

Shariah compliance is founded on the principle of "social justice" where companies are required to adhere to Islamic laws, which include prohibition of liquor, pork and vice, as well as fair and responsible trading practices.
 
"Having explored the possibilities provided by this region for the last two years, this certificate marks an important milestone for us," says Arun Rama, Managing Director of Ritz Property Investment Asia Pte Ltd. "The regional Islamic finance market is very strong, and with our worldwide presence, our offering will enable us to tap a much larger funding pool."
 
Indeed, Islamic finance is fast gaining traction worldwide, and Shariah-compliant products have proven to be resilient even in volatile markets. Ratings agency Standard & Poor's estimates that the global Islamic finance industry is worth about USD$1.8 trillionas at 2014, and is set to grow to as much as USD$3 trillion in the coming years withMalaysia being one of the industry's key drivers.
 
"The demand has indeed increased exponentially over the last few years," says Professor Ashraf Mohd Hashim, Chief Executive Officer of ISRA Consultancy. "(Shariah compliance) creates a unique portfolio offering for clients, allowing companies to expand in Southeast Asia, as well as the oil-rich Middle Eastern investors."
 
The ICD Thomson Reuters Islamic Finance Development Indicator (IFDI) which measures the state of the Islamic finance industry globally, ranks Malaysia as its top market, valued at USD$166 billion in 2013, followed by Saudi Arabia (USD$36.4 billion), and the United Arab Emirates (USD$24.1 billion).