In 2014, Nasdaq Dubai is set to exceed the volume of sukuk (Islamic bonds) listed on the exchange last year. The growth will help the bourse in its quest to become the leading venue to list Islamic bonds, as well as supporting Dubai’s aspirations of becoming a hub for sharia-compliant finance.

Yet Nasdaq Dubai faces competition from other international exchanges and finance hubs, all vying for a larger share of the growing sukuk market. To ensure long-term growth, the exchange will have to broaden its capabilities and offer a wider range of products.

To date this year, the bourse has listed $8.2bn-worth of sukuk, compared with the $6.1bn listed in 2013. The growth in listings has helped maintain Dubai’s position as the third-most active venue for sukuk listings. But competition is getting tighter. London is looking to further raise its profile in the Islamic finance world, with the UK government having conducted an investor roadshow in the Gulf in mid-June for its forthcoming debut sovereign sukuk issuance.

To keep attracting issuers and investors, Nasdaq Dubai has started developing new products. It is currently piloting a fixed-income trading platform for both bonds and sukuk as an alternative to traditional over-the-counter trading.

It has also created a sharia-compliant murabaha platform that could rival the London Metals Exchange as a means for Islamic banks to manage their short-term liquidity needs.

Hamed Ali, CEO of Nasdaq Dubai, told MEED he would like to open up the sukuk market to retail investors in the future. Such initiatives will help the exchange attract more sukuk issuers and investors to Dubai, helping the emirate compete on the international stage.