MANILA, Philippines - The Philippine Stock Exchange hopes to complete a list of Shariah-compliant stocks by next year, as this is expected to attract local and foreign Muslim investors.
"We're hoping that we can actually have an index sometime next year," PSE President Hans Sicat said in an interview with ANC's News Now on Friday.
"We're working with the NCMF (National Commission for Muslim Filipinos) essentially to help with this project ... [and] over the last few weeks, we have invited experts or those who are already participating in these Shariah-compliant boards to talk about the processes and [act] as advisers," he added.
Shariah, a framework of ethical guidelines, bars Muslims from investing in companies that engage in gaming and gambling, interest-earning activities such as banks, manufacturing of non-halal products, conventional insurance, and non-compliant entertainment services, among others.
"Shariah is a set of principles ... that says that you cannot be investing in industries which are harmful to one's self or to the society," Ashraf Mohammed, Assistant General Counsel at the Asian Development Bank, said in the same interview.
Mohammed lauded the PSE for promoting Islamic finance in the Philippines, and noted there are opportunities to deepen the stock exchange with listing Shariah-compliant stocks.
In fact, Sicat said that Muslim investors in the country are currently tapping stock markets abroad with Shariah-compliant stocks such as boards in Indonesia, Malaysia, Thailand, Hong Kong and even in Singapore.
"We're here with a limited target market and what we want to do is set this up correctly so it becomes successful. Hopefully success will breed expansion of that market," Sicat said.
He added Shariah-compliant stocks in the PSE can also attract foreign funds to come in, particularly those from Middle East.
This current effort of the PSE is geared towards improving the liquidity in the local stock market, Sicat noted.
The PSE index (PSEi) gained 6.47 points to close at 5,405.16 on Thursday. The market was closed on Friday amid the Eidul Adha, or Feast of Sacrifice, a Muslim religious celebration marking the end of the annual pilgrimage to Mecca.