The UK will become the first non-Muslim country to sell a bond that can be bought by Islamic investors in a bid to encourage massive new investment into the City.
George Osborne, the chancellor, will on Tuesday announce plans for Britain to issue the first Islamic bond outside the Muslim world, as he seeks to turn the City of London into the “unrivalled western centre for Islamic finance”.
“When Islamic finance is growing 50pc faster than traditional banking and when global Islamic investments are set to grow to 1.3 trillion by 2014, we want to make sure a big proportion of that new investment is made here in Britain,” Mr Cameron will tell an audience of senior officials from Islamic countries.
The World Islamic Economic Forum has never been held before in a non-Muslim country and highlights the growing role London is playing in the Islamic finance industry.
The London Stock Exchange is preparing to launch an Islamic Market Index to help the managers of sharia-compliant funds identify new investment opportunities around the world.