Djibouti: A Hub for Expanding Islamic Finance Across ‘Horn of Africa’

Abstract

Islamic Finance is a growing rapidly across Africa, where around 40% of the population is Muslims and is now offered across 21 African countries, with one country leading the pack – Djibouti. Djibouti can be referred as ‘logistical and financial hub for East Africa’ due to its fast-growing port access and availability, progressive banking regulations and strong intra-regional connectivity with Ethiopia and other landlocked countries which have no or poor port access. Besides logistics, other sectors that continue to show significant growth in Djibouti include financial services, tourism, and hospitality, education and telecommunications. This article presents the status of Islamic finance in Djibouti, challenges it faces and its future in the region.

Keywords: Islamic Finance, Banking, Djibouti, Africa

JEL Classification: F65, G21