Finance Ministry: Sukuk expand the range of financing instruments available to the state

The Ministry of Finance stated that the issuance of Law No. (90) of 2026 concerning government sukuk enables the state to issue them as a Sharia-compliant financing instrument and include them within the sovereign financing structure alongside traditional debt instruments.

In this regard, Finance Minister Dr. Yaqoub Al-Rifai said, “The enactment of the Government Sukuk Law represents a significant step in developing Kuwait’s sovereign financing framework by expanding the range of financing instruments available to the state and adding a Sharia-compliant instrument. This enhances the flexibility in managing financing needs, diversifies funding sources and the investor base both locally and internationally, and supports the state’s direction toward developing capital markets and improving the efficiency of financial liability management. This aligns with financial sustainability targets and preserves the strength of the state’s financial position.”

For his part, Faisal Al-Muzaini, Director of the Public Debt Department at the Ministry of Finance, noted that the law’s most significant achievement is completing the necessary tools to implement a comprehensive public debt management strategy, as it allows the inclusion of sukuk within the state’s sovereign financing structure alongside traditional debt instruments.

This is accompanied by greater flexibility in managing the debt portfolio, including diversifying instruments, markets, maturity profiles, and the investor base; enhancing the ability to manage refinancing and liquidity risks; and selecting the timing, size, and structure of issuances according to the state’s financing needs and local and global market conditions. It also provides an additional framework to capitalize on opportunities in Islamic finance markets, thereby broadening the base of local and international investors.

He highlighted the importance of the law in the local and international financial context, explaining that the local issuance of government sukuk will support the development of the local debt market and the construction of a sovereign yield curve for sukuk across different maturity tenors. This will enhance pricing efficiency and provide a reference benchmark for corporate and financial institution issuances, while contributing to deepening the secondary market and boosting liquidity levels. He affirmed that the ministry will adopt an institutional and well-considered approach in managing issuances, supporting the establishment of a regular and sustainable presence for the State of Kuwait in local and international capital markets and reinforcing its position as a sovereign issuer.