Bangkok--26 Feb--Moody's Investors Service Moody's Investors Service says the global Islamic finance market, which includes Asia Pacific, has grown by approximately 15% in each of the past three years, partly as a result of the increased wealth in Islamic countries, driven in turn by high oil prices. Furthermore, the market shows no signs of slowing, says Moody's in a new special report entitled "2007 Review & 2008 Outlook: Islamic Finance". The just-released report is authored by Dominique Gribot-Carroz, a Moody's AVP in Hong Kong, and Faisal Hijazi, an Analyst in London. According to Moody's, Islamic finance is now estimated to be worth around USD700 billion globally, while Sukuk, or Islamic bonds, are the fastest-growing segment with volumes worldwide reaching USD97.3 billion up through 2007. "From a global point of view, we anticipate that overall Sukuk issuance should continue to increase in 2008 by approximately 30-35% per annum," says Gribot-Carroz, adding that new funds will be raised mostly in Gulf Cooperation Council countries, North Africa and Asia-Pacific. More specifically, Moody's new report points out that Asian currency-denominated Sukuk outstanding grew by close to 50% to USD65.3 billion in 2007 from USD43.6 billion in 2006, adding that growth has become even more sustained since the summer of 2007. In addition, Malaysia continues to lead the way in terms of offering an attractive environment for Islamic finance and remains the biggest domestic market worldwide. Ringgit-denominated Sukuk issued in 2007 amounted to the equivalent of USD64.4 billion, or 66% of the global outstanding as of 31 December 2007. The prospects for Islamic finance in Asia Pacific are generally good, the report says. For example, the Japanese government is planning its first sovereign Islamic Sukuk in 2008, valued at between USD300 million and USD500 million. Moreover, in the rest of Asia, economies such as Singapore are contemplating issuing their first Sukuk in 2008, while in Hong Kong the authorities are fully supportive of the development of Islamic finance. At the same time, Moody's expects the small but growing Sukuk markets in Pakistan and Indonesia to grow significantly over the coming years. Even though the total assets of Islamic banks in Indonesia may still only represent a minor portion of the country's total banking assets, Moody's believes they are expected to grow significantly, and that this could also encourage Sukuk issuance. Moody's new report also covers the Takaful, or Islamic insurance, industry; project finance, Islamic banking, and Islamic real estate investment trusts. In the IREITs sector, two have debuted so far in Malaysia since the country issued guidelines for such structures in 2005.