Sukuk-waqf: The Islamic Solution for Public Finance Deficits

The majority of Muslim countries face increasing pressure on their budget, which pushes to more public spending. Eventually, the main victim of this situation will be the welfare of Muslim communities. Despite Islam does not tolerate negligence regarding the importance of State as major player in preserving the welfare of Muslim communities, it offers a third option to support public effort through the institution of Waqf. Indeed, this institution has played a crucial role all along Muslim civilization and it is invited to more innovation to answer to today’s challenges. Sukuk-Waqf can be seen as the perfect sustainable financing instrument offered by Islam to help sustain public spending by the people and for the people. This paper will try to examine the concept of Waqf, cash Waqf and Sukuk Waqf is Islam and their evolution during Muslim civilization. Finally, it will go through modern attempts to implement this model that can answer the need for financing to support public effort to preserve the welfare of Muslim citizens.