The Contribution of Islamic Sukuk in Financing Development Budget Deficit in Libya

Abstract

This research investigated the possibility of limiting the frequent budget deficit in Libya during the last years. It offers the proposal of financing some of the state-financed development projects through Islamic Sukuk. The descriptive analytical approach was used in this study supplemented by some relevant data from reports, journals and research papers. The study confirms the possibility of benefiting from other countries previous experiences in issuing and using Islamic Sukuk. These experiences emphasized the effectiveness of these checks for financing the development projects as an alternative for limiting the deficit in the state development budget. The Libyan State is required to create the appropriate environment for issuing and using these Sukuk through legislations and the establishment of the Islamic financial market. It is also important to enhance the awareness of the Libyans about the importance of using these Sukuk.