C4 News:

Economic Secretary Ed Balls will declare that the Government will "promote new ways for British Muslims to bank, save and borrow using Islamic finance products."

He wants the City play a "key role" in the growing Islamic Finance market.

Islamic finance assets worldwide, including private equity and bonds, are now estimated to be more than £120 billion.

Mr Balls is to announce that officials from the Treasury and the UK Debt Management Office will head up a feasibility study to report back in time for the Pre-Budget Report this autumn.

It will look at the costs and potential benefits of the Government issuing Islamic financial instruments in the wholesale sterling market.

Mr Balls has also asked National Savings and Investments to look at the feasibility of the Government becoming an issuer of retail Islamic financial products. The Product Review will report in spring 2008.

In a speech to the Financial Services Authority Mr Balls is expected to say: "The Islamic finance market is growing globally year on year, and we want London to play a key role in this area.

"Domestically, we will do everything we can to promote new ways for British Muslims to bank, save and borrow using Islamic finance products. The measures this Government has taken make it possible for issuers to seriously consider the merits of issuing Islamic finance instruments.

"I believe there are great potential advantages for the UK government issuing Shariah compliant government debt. The feasibility study will also be assessing the opportunity for issuing such instruments, taking into account the government's debt management objectives."

http://www.muslimnews.co.uk/news/news.php?article=12641

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