Research

Research

 

Research Projects in Jeffrey Sachs Center on Sustainable Development

 

Project Leader: Prof Woo Wing Thye

The 8th Sustainable Development Goal is to “promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all.” While the strategy of export-oriented growth in East Asia has produced rapid rates of economic progress for ASEAN countries, lifting millions out of poverty in the last few decades, imbalances in economic development are beginning to become serious. Specifically, income inequality between income groups within countries is growing rapidly and social mobility is slowing down in the more developed East Asian economies.

Social exclusion and excessive inequality tend to stoke socio-political tensions and generate instability that lower economic growth rates and make growth less sustainable over time. Furthermore, the technological trend of replacing low-skill with machines (e.g. robots) is exacerbating the downward pressure on the income share of the poorest groups. Social programs must respond innovatively to new disruptive technologies that could shatter social harmony even as they prevent stagnation in economic productivity.

This research project aims to uncover how to leverage technological innovation to create circuits of economic activity and work opportunities that would raise the welfare of lower-income and marginalised groups. This project also aims to come up with institutional innovations that would mitigate the negative social impact of disruptive technologies. It is crucial that governments have the knowledge to induce the emergence of technologies that will not only elevate economies up the technological ladder but also to enable the emergence of small players alongside large incumbents, thus, widening the pool of innovators to include those that did not previously participate in the innovation process.

Project Leader: Dr Fun Woh Peng

This research project makes the case that Malaysia has a responsibility to reduce its carbon emission as a citizen of this planet. As such, addressing the sources of carbon emissions are of immediate priority, the largest of which is electricity generation. Currently, the production and consumption of electricity is concentrated in Peninsular Malaysia. This paper proposes solutions to the two key areas of electricity supply optimization, and the reduction of transmission and distribution losses.

A number of policies were introduced to bring about the implementation of renewable energy for electricity generation. The Feed-in-Tariff scheme was introduced in 2012, would see Tenaga Nasional Berhad purchase electricity generated from renewable sources at a fixed premium rate. However, installation of renewable energy, and in particular solar PV, has fallen short of its targets. The Net Energy Metering scheme replaced it shortly after and changed its focus to self-consumption. With only the excess electricity being sold to the utility at a lower prescribed rate, this scheme very much reduced the financial feasibility of renewable energy, even with the Income Tax Allowance. Extending a similar tax deduction to households and expediting the allowance approval process would be good first steps in moving forward Malaysia’s renewables agenda.

This project focuses on the deployment of sustainable energy technology in various application settings. The project provides advisory for the deployment of a renewable energy system for Malaysia; beginning with a solar-battery combination, that will be deployed as a demonstrable project in a number of locations in Sunway City and other Sunway properties in Malaysia. The installation of a rooftop solar energy system has been completed across several locations in Sunway City including in Sunway University between 2017 and 2018.

A smaller scale solar-battery system is being designed for deployment in off-grid rural communities to bring electricity to areas that have lack of access to energy. As connecting remote communities to the national grid is a very capital-intense endeavour, off-grid module and micro-grids would potentially be a more cost effective solution to this problem.

Future extensions to this project would look into other energy technologies such as the use of reformed natural gas for hydrogen fuel cells. This project would look to address SDG 7 (Affordable and Clean Energy) and SDG 11 (Sustainable Cities and Communities) in the course of its work.

Publications:

  • Fun, W.P., The Malaysian Renewable Energy Policies: Why They Have Not Met Their Targets, JSC Policy Paper Series (forthcoming).
  • Fun, W.P., The Malaysian Carbon Dioxide Emission Commitment: Why meeting the target will not be enough, JSC Policy Paper Series (forthcoming).
  • Fun, W.P., NEM 2.0: Roadmap to a Sucessful Policy Adoption, JSC Policy Paper Series (forthcoming).
  • Fan, A., Lim, J., Chong, K.B., Optimizing The Efficiency of the Electricity Generation and Distribution System in Peninsular Malaysia to Fight Climate Change, JSC Policy Paper Series (forthcoming).

Project Leader: Derek Kok

More than one in five Malaysian children are stunted due to chronic malnutrition - a figure that is worse than Ghana and war-torn Gaza. Studies have also shown that stunting has practically irreversible long-term effects on individuals and societies. Despite this, there is little awareness of the issue among both policymakers and the general population. This ongoing research examines the Institute of Public Health’s data on stunting in Malaysia, highlights possible causes, and recommends an integrated framework of policy interventions to achieve the goal of reduced childhood stunting in Malaysia. The project looks to address both SDG 2 and 3.

Project Leader: Prof Woo Wing Thye

This ongoing research project will examine the need for reforms in the allocation of state government budgets and the overall governance of state vis-a-vis the federal government. It goes into the details of economic changes necessary for growth on the state level such as GLC reform and the formation of small and medium banks. On the matter of governance, greater levels of autonomy is needed for Malaysia states to dictate the course of their own development path.

Project Leader: Prof Woo Wing Thye

This ongoing research paper will propose a roadmap to lifting the income and grow Kedah’s economy through the modernisation of its existing agricultural sector. The move from low value-added paddy rice to high value cash crops will be an important first step to improving incomes on the ground. Food processing also presents a potential avenue for higher value-added economic activities in Kedah. The case for modernisation will be made through analysing the past instances of transition in Thailand and various other countries.

Project Leader: Prof Koh Hock Lye

Lakes, rivers and estuaries provide essential services to ecosystems, wildlife and human. The economic-ecosystem service value of a given lake or estuary is contingent on its water quality and trophic status. The current water quality status of many urban lakes, rivers and estuaries in Malaysia is Class III and is rated as eutrophic. Given the projected increase in urban population and intensifying land-use surrounding urban lakes and estuaries and given the unabated accumulation of nutrients in the lake sediments, a prognosis is that all lakes, including Sunway Lagoon (SL) and lakes within the Putrajaya district, are threatened by regime shift to eutrophication (Koh et al., 2018 a). The primary goal is to maximize ecosystem- social-economic value of lakes, rivers and estuaries. This project has achieved the goal of rehabilitating SL (Koh et al., 2018 b) and aims to extend the application to other urban lakes and estuaries including those in Putrajaya and Iskandar Johor. Without proper water quality management, lakes and estuarine water may over time approach an irreversible and costly hyper-eutrophication threshold. The abrupt regime shift (bifurcation tipping) from a eutrophic to a hyper-eutrophic condition can be rapid once the critical threshold is reached. This regime shift can be delayed or prevented by proper lake water quality management that utilizes low-resource and low-carbon methodology and technology (Koh et al., 2018 c). This project has developed methodology and simulation models (Figure 1) for the analysis, synthesis, prognosis and management of lake and estuarine ecosystems. This research will address SDG 6 (Clean Water and Sanitation), SDG 11 (Sustainable Cities and Communities), SDG 13 (Climate Action) and SDG 14 (Life Below Water).

Publications:

  • Koh, H.L., Tan, W.K. and Teh, S.Y. (2018a). Regime Shift Analysis and Numerical Simulation for Effective Ecosystem Management. International Journal of Environmental Science and Development 9(8), 192-199. DOI: 10.18178/ijesd.2018.9.8.1099 (Indexed by Chemical Abstracts Services (CAS), CABI, DOAJ, Ulrich Periodicals Directory, Engineering & Technology Digital Library, Electronic Journals Library, Crossref, ProQuest). Best paper.
  • Koh, H.L., Teh, S.Y., Lee, E., Tan, W.K., Sagathevan, K.A. and Low, A.A. (2018b). Derivation of optimal fish stocking density via simulation of water quality model E2Algae. AIP Conference Proceedings 1974, 020042. DOI: 10.1063/1.5041573 (ISI Proceedings).
  • Koh, H.L., Teh, S.Y. and Tan, W.K. (2018c). Water Quality Simulation for Rehabilitation of a Eutrophic Lake in Selangor Malaysia. International Conference on Ecology and Biodiversity Across Time and Space (ICEBATS2018), 15-17 August 2018, Universti Sains Malaysia, Penang, Malaysia. Submitted to journal publication; under review.

Project Leader: Prof Koh Hock Lye

Mangroves provide critically essential services to many ecosystems, wildlife and human. However, mangroves are vulnerable to climate change impact, to anthropogenic activities and to catastrophic coastal disturbances. Amongst the various climate change scenarios, sea level rise (SLR) poses the greatest threat to mangroves. Extensive coastal reclamation and unrestrained development can alter the local coastal habitats to make them unsuitable to mangroves. Large coastal disturbances such as tsunamis and other extreme storm surges induced by hurricanes and typhons can instantly destroy mangroves at a large scale. Warming climate has increased the frequency, duration and intensity of these coastal disturbances. This project compiles global data relevant to impacts of climate change on coastal resources and performs model-based simulations to improve the state of art knowledge of mangrove vulnerability and resilience to climate change and to propose climate change adaptation strategy. Adaptation strategy includes integrated coastal zone management best practices that incorporate adequate provision to facilitate mangrove protection, survival and landward migration with SLR. Numerical simulations and site monitoring are performed for analysing the impact of climate change on the interaction between mangroves and functionally linked ecosystems such as the hardwood hammocks (Figure 2). State of the art simulation model MANTRA-O18 is developed to provide early warning signals to catastrophic regime shifts that can pose serious threats to coastal surface and groundwater resources critical to the survival of coastal populations (Teh et al., 2018 a, b). Research collaborators include the Universiti Sains Malaysia (USM), Forest Research Institute Malaysia (FRIM), Miami University, USGS, and Nanjing Forestry University. This research addresses SDG 6 (Clean Water and Sanitation), SDG 13 (Climate Action), SDG 14 (Life under water) and SDG 17 (Partnerships for the Goals).

Publications:

  • Teh, S.Y., Koh, H.L., DeAngelis, D.L., Voss, C.I. and Sternberg, L. (2018a). Modeling δ18O as an early indicator of regime shift arising from salinity stress in coastal vegetation. Hydrogeology Journal (ISI IF: 2.071), Accepted with minor revision.
  • Koh, H.L., Teh, S.Y., Kh’ng, X.Y. and Barizan, R.S.R. (2018). Mangrove Forests: Protection Against and Resilience to Coastal Disturbances. Journal Tropical Forest Science 30 (Anniversary Issue): 446–460 (2018). IF 0.655.
  • Romañach, S.S., DeAngelis, D.L., Koh, H.L., Li, Y., Teh, S.Y., Raja Barizan, R.S. and Zhai, L. (2018). Conservation and Restoration of Mangroves: Global Status, Perspectives, and Prognosis. Ocean and Coastal Management 154, 72-82, Elsevier. (ISI Journal, IF: 2.276) DOI: 10.1016/j.ocecoaman.2018.01.009
  • Teh, S.Y., DeAngelis, D.L., Voss, C.I., Sternberg, L. and Koh, H.L. (2018b). MANTRA-O18: An Extended Version of SUTRA Modified to Simulate Salt and δ18O Transport amid Water Uptake by Plants. E3S Web of Conferences (Online journal indexed in ISI).

Project Leader: Dr Gopalasamy Reuben Clements

Malaysia hosts the oldest tropical rainforests in world, dating back 130 million years, significantly contributing to carbon sink, biodiversity, environmental services and eco-heritage. According to the National Biodiversity Index, Malaysia is ranked 12th of the megadiverse countries in the world. Yet, the loss of primary forest is a huge threat to the ecosystem that not only endangers flora and fauna, but causes flooding due to soil degradation and river sedimentation. This study aspires to uphold the commitment made by the Malaysian government to ensure that at least 50% of land area remains permanently under forest cover. This research explores potential solutions to increase forest cover and improve the biodiversity in Malaysia via proper management, intergovernmental responsibilities and international frameworks and mechanisms.

  • Clements GR, Aziz SA, Giam X, Bentrupperbaunmer J, Goosem M, Laurance S & Laurance WF (2018). Not everyone wants roads: assessing indigenous people’s support for roads in a globally important tiger conservation landscape. HUMAN ECOLOGY. DOI – PDF
  • Wijedasa L, Sloan S, Page SE, Clements GR, Lupascu M & Evans TA (2018). Carbon emissions from Southeast Asian peatlands will increase despite REDD+ program. GLOBAL CHANGE BIOLOGY 24: 4598-4613. DOI – PDF
  • Ratnayeke S, van Manen FT, Clements GR, Mohd Kulaimi NA & Sharp SP (2018). Carnivore hotspots in Peninsular Malaysia and their landscape attributes. PLOS ONE 13(4): e0194217. DOI – PDF

Project Leader: Jasmin Irisha Jim Ilham

The Food, Agriculture, Biodiversity, Land Use and Energy (FABLE) Pathways Consortium was launched in 2017 by Sustainable Development Solutions Network (SDSN) and the International Institute for Applied Systems Analysis (IIASA). The initiative aims to develop consistent global and national pathways towards sustainable land use and food systems by 2050. The outcomes of this exercise is intended to be an input for UNFCCC COP24 and CBD COP15.

There are three methods of approach in compiling Malaysia’s country information, which includes Expert Opinions, National Policies and Projected Pathways. The project is currently undertaken by the Jeffrey Sachs Center and Universiti Sains Malaysia. The objective of the working paper is to learn and understand the FABLE Scenathon, explore Alternative Scenarios and comprehend the main development pathways for food systems in Malaysia by 2050.

Project Leader: Prof Koh Hock Lye

Lakes, rivers, estuaries and wetlands provide essential services to ecosystems, wildlife and human. They are constantly threatened by regime shift and by other environmental and climate shocks (Koh and Lujan, 2018). These coastal resources are vulnerable to climate change impact such as increased salt intrusion and sea level rise, to anthropogenic activities and to catastrophic coastal disturbances including tsunamis (Koh et al., 2018; Teh et al., 2018), hurricanes and typhoons. Warming climate has increased the frequency, duration and intensity of these coastal disturbances, implicating profound threats to coastal resources and populations. Numerical simulations coupled with onsite monitoring can improve the state of art knowledge of coastal vulnerability and resilience to climate change and anthropogenic disturbances (Teh and Koh, 2018); and can provide valuable insights to climate change adaptation strategy for sustainability (Woo et al., 2018; Walter et al., 2019). A dedicated book will address actions and programs critically needed to achieving United Nations Sustainable Development Goals UN-SDGs (Koh and Teh, 2019).

Publications:

  • Koh, H.L. and Teh, S.Y. (2019a). Disaster Risk Reduction and Resilience Through Partnership and Collaboration. In the Encyclopedia of the UN Sustainable Development Goals: Partnership for the Goals. Edited by Walter Leal Filho, Anabela Marisa Azul, Luciana Brandli, and Tony Wall. Springer. Invited article. Under Review.
  • Koh, H.L. and Teh, S.Y. (2019b). Climate Change Mitigation and Adaptation: Role of Mangroves in Southeast Asia. In the Encyclopedia of the UN Sustainable Development Goals: Climate Action. Edited by Walter Leal Filho, Pinar Gökçin Özuyar, Anabela Marisa Azul, Luciana Brandli, Ulisses Azeiteiro and Tony Wall. Springer. Invited article. In press.
  • Koh, H.L. and Teh, S.Y. (2019c). Ecological Modelling for Mitigating Environmental and Climate Shocks: Achieving the Aspirations of UN-SDG. Book by World Scientific Publishing. Forthcoming.
  • Koh, H.L. and Teh, S.Y. (2019d). Skills, Spirituality and Strategy: Three Core Competences in Education for SustainAbility. Submitted to the 2nd International Conference on Sustainable Development Goals. 30-31 July 2019, USM
  • Koh, H.L., Teh, S.Y., Chai, M.F. and Tan, W.K. (2018). Tsunami Resilient Community: Towards Achieving SDG 1 for Reducing Poverty. Invited speech at SCSTW-10, The National University of Singapore, 10-11 October 2018. To submit to journal “Natural Hazards”.
  • Koh, H.L. and Lujan, M. (2018). South East Asian Disaster Community Resilience (SEAD-CORE). A research grant proposal submitted to UKRI GCRF Global Challenge: Resilience to Environmental Shocks and Change.
  • Teh, S.Y., Koh, H.L., Lim, Y.H. and Tan, W.K. (2018). High Resolution Digital Elevation and Bathymetry Model for Tsunami Run-up Simulation for Penang Beaches. Invited speech at SCSTW-10, The National University of Singapore, 10-11 October 2018. Submitted to Journal of Earthquake and Tsunami. Under review.

Project Leader: Dr Chong Kok Boon

The project aims to helps Malaysia plays a role in preventing global temperature rise by 2 degrees Celsius via a comprehensive study to model possible pathways for deep decarbonisation. The project covers few sectors mainly focus on sustainable energy systems, economics, transportation, building, industrial and environment. First target is to build the baseline for Malaysia carbon emissions follow by simulation modelling study with incorporates all existing available technologies in varies scale of decarbonisation. Economic and environmental impacts will be modelled based on the life-cycles analysis for each available technology to revise and refurbish the modelling. The project will have addressed SDG7 (Affordable and Clean Energy), SDG9 (Industries, Innovations and Infrastructure), SDG11 (Sustainable Cities and Communities) and SDG13 (Climate Action). The collaborators for the project are The Education University of Hong Kong and Energy + Environment Economics (E3) USA.

Project Leader: Andrew Fan Chiah Howe

The Jeffrey Sachs Center is developing a dashboard to report the national and ASEAN-level SDG Index, using available and nationally appropriate data that is consistent with those reported in the Global SDG Index by the Sustainable Development Solutions Network and Bertelsmann Stiftung. The instrument will present the standing of Malaysia, and thereafeter, the ASEAN countries, allowing comparison to each other as well as to the best performing countries in the world. The dashboard will particularly highlight and delve deep into areas of critical concern, i.e. those that appear as red flags in each individual country, or as a region wherever applicable. For these areas, a research team will be mobilised to conduct in-depth analysis and put forward practical recommendations, in the aim that countries will pursue all the three pillars sustainable development, namely prosperity, inclusiveness and environmental sustainability.

Project Leader: Jasmin Irisha Jim Ilham

This study focuses on education for sustainable development and global citizenship. It explores the role of universities in ensuring the SDGs are met, as a mobilizing catalyst for accelerated implementation, as well as case studies of sustainable campuses in Malaysia that showcase the community and student outreach projects, in line with the SDGs, such as the Bicycle Project at the University of Nottingham, Malaysia Campus; Kompos to Kelulut (K2K) at Universiti Sains Malaysia; and Sunway Youth for Sustainable Development and The Last Straw Campaign at Sunway University. The case studies show that education goes beyond the formal curricula, emphasizing soft skills and critical thinking as major components of responsible behaviour.

Publications:

  • Ilham, J.I.J., Zaihan, M.H., Hakimi, S.M., Ibrahim, M.H. & Shahrul, S. (2018), Mobilising the Sustainable Development Goals through Universities: Case Studies of Sustainable Campuses in Malaysia, in the book "Universities as Living Labs for Sustainable Development: Supporting the Implementation of the Sustainable Development Goals” (Springer, in press).
  • Woo, W.T., Koh, H.L. and Teh, S.Y. (2018). Achieving excellence in sustainable development goals in Sunway University Malaysia in “Universities as Living Labs for Sustainable Development: Supporting the Implementation of the Sustainable Development Goals”, (Springer, in press). BEST PAPER
  • Teh, S.Y. and Koh, H.L. (2018). Education on sustainable development: The STEM approach in Universiti Sains Malaysia in “Universities as Living Labs for Sustainable Development: Supporting the Implementation of the Sustainable Development Goals”, (Springer, in press).
  • Walter, L.F., Valeria, V., Koh, H.L. et al. (2018). The Role of Higher Education Institutions in Sustainability Initiatives at the Local Level in Journal of Cleaner Production. Under Review. (IF 5.651).

Project Leader: Dr Clarissa Ai Ling Lee

This project considers the transnational and comparative contexts for understanding the emergence of nuclear science and technology (S&T) within the developmental context of Malaysia and the rest of ASEAN, in consideration of lessons learned from other Asian countries in South and East Asia. Although the focus is on nuclear S&T, a deep study of this area of multidisciplinary science and technological development, both for science in the pure and applied contexts, could help us develop national indicators for S&T development because the development of nuclear technology is also dependent on an assortment of development in other areas of scientific knowledge beyond the immediate obvious boundary of nuclear science.

The project will also look into circumstances pertaining to knowledge ethics in public science communication, science and technology transfer, nuclear energy potential, as well as radiation risks and standards, all of which are in line with the 2030 Agenda intent at developing transdisciplinary solutions-oriented research while engaging more multifaceted expertise and stakeholders – it also connects with SDG 3 on good health and well-being, SDG 11 on sustainable cities and communities and SDG 17 in partnerships for the goals. This project is done in conjunction with the Centre for Radiation Sciences at Sunway University.

Publications:

  • Lee, C.A.L. “Radiation and the Public: the role of nuclear security and safeguards in public acceptance of nuclear technology in the case of Malaysia.” IAEA-CN-269-329. Proceedings of the International Conference on Security of Radioactive Material: the Way Forward for Prevention and Detection. (December 2018)
  • Lee, C.A.L., “Historical Amnesia of the Scientific Mind in Southeast Asia.” The Compass. Issue 4 (March 2018): 10. On the role of the history of science for thinking science policy in Malaysia.
  • Lee, C.A.L., “Nuclear Science as Big Science in Southeast Asia: The Case of Malaysia” Asia-Pacific Physics Newsletter. Institute of Advanced Studies, Nanyang Technological University. Singapore: World Scientific Publishing. October 2017.

Project Leader: Dr Clarissa Ai Ling Lee

This is a collaborative project between the JSC, other academic departments at Sunway University and Lancaster University, in partnership with UNU-IIGH. The objective of the project is to explore how might speculative design enable citizens and governments in developing countries engage in policy agenda-setting on ageing well in the city.

Like other developed and developing countries globally, Malaysia faces the challenges of supporting an ageing population. The World Health Organization (2015) has been critical of the approaches adopted internationally thus far and has argued that “more of the same will not be enough” and “with the right policies and services in place, population ageing can be viewed as a rich new opportunity for both individuals and societies”. This project was showcased at the 2018 World Urban Forum for enabling more efficient, effective, transparent and evidence-based policy making for governments. This project contributes toward achieving SDG 10 and SDG 11.

Publications:

  • Tsekleves, E., Yong M.H., Lee, C.A.L., Giga. S., Hwang, J.S., Lau, S.L. “Rethinking how healthcare is conceptualised and delivered through speculative design in the UK and Malaysia: A Comparative study.” Running with Scissors. 13th EAD Conference University of Dundee, 10-12 April 2019. Forthcoming in a supplement to The Design Journal.
  • Lee, C.A.L. and Lau, S.L.. "Imagining the Future of Foods Through Speculative Design", in Proceedings of International Conference on Culture Technology. (November 2018)

Project Leader: Dr Clarissa Ai Ling Lee

The proposed project will develop an art-science methodology for designing emergent futures by drawing on historical and contemporary knowledge, as well as projects, coming out of science and technology that interface with techniques and methods from the arts, in relation to their interactions with socio-political concerns, thereby producing knowledge addressing sustainability issues. This exploration will consider historical and contemporary scientific knowledge emerging from Malaysia/Southeast Asia and other regions in terms of how they interface with one another, and how that interface gives rise to emergent knowledge parlayed towards socio-epistemic innovation that aims to attend to some of the goals of sustainable development. This research expands from an area of research that began through the previously funded ImaginAging project, but with the intent of giving more focus to furthering the development of art-science methodology initially emerging from the work produced through speculative design. This project is also indirectly tied to the AHRC funded Protopolicy Asia project (2019-2020) that aims to deploy speculative design to the community.

Project Leader: Prof Mohamed Ariff Syed Mohamed

Exchange rate volatility has been at the epicenter of several financial crises that led to economic declines, which usually also precipitates financial instability via currency depreciation. This research examines currency volatility as a measure of currency instability. Fifteen currencies are selected from developed and emerging economies to study this issue with data over the last 20 years. Much has been written by IMF and others about how countries manage their exchange rates in order to promote economic growth, especially sustainable trade, by designing proper exchange rate regimes for stability. It is possible, as shown by this study, to track a currency’s exchange rate instability using a given currency’s volatility of against the volatility of a benchmark ‘currency of importance’, termed relative volatility.

Publications:

  • Ariff, M., and Zarei, A., (2018). “Sustainable development and the Currency Exchange Rate Behavior” in the Asian Economic Papers Vol 18 (in press) in Routledge journal.
  • Ariff, M., and Zarei, A., (2018). “Sustainable Development Requires Stable Currency Exchange Rates” in Boubaker, S., Cummings, D., and Duc Nguyen (eds). Research Handbook of Investing in the Triple Bottom Line: Finance, Society and the Environment publisher Edward Elgar Publishing UK-USA.

Project Leader: Prof Mohamed Ariff Syed Mohamed

Islamic fiunding instruments such as sukuk offer a completely different and new way of debt contracting in comparison with traditional bonds funding development activities, as they relate to specific asset-backed funding by contracting targeted funding of an entity instead of general funding that embraces pro-growth set of ethical principles grounded on the Islamic teachings on financial trading. This new growing segment of sukuk bonds has attracted attention of professionals especially because it has chalked up an outstanding value estimated to be around USD 320 billion as at 2017 mostly in five financial centers: Malaysia, Indonesia, Saudi Arabia, United Arab Emirates and Bahrain (without considering Iran, with a big market for this form of funding). There are other 13 countries where one or more sukuk financial instruments are listed and traded in their respective national financial markets, an example being the London Stock Exchange. The London Stock Exchange listed its first sukuk instrument in August 2014, with the announcement made by the English Government of making London a leading center for this form of debt contracting. This paper shows that this new debt instrument is able to secure financial stability since the returns to investors in this form of lending are protected by asset backing and share in the risk of the project, and hence is a less risky mode of development funding with evidence of promoting financial stability.

Publications:

  • Ariff, M., (2018). “A new form of global asset-backed debt market thorugh sukuk” in Catellan, Valentino (ed) (2018). Islamic Social Finance: Entrepreneurship, Cooperation and the Sharing Economy. Published by Routledge (Taylor & Francis Group) London and New York.

 

JEFFREY SACHS CENTER (DU 025 (B))

Sunway University, Malaysia

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  • Email: jsc@sunway.edu.my