The interactive effect of sukuk issuance and inflation on economic growth with emphasis on the role of other macroeconomic factors in selected countries of the MENA region (ARDL panel model approach)

Articles in Press

Document Type : Research Article

Author
Ashkan Rahimzadeh
Islamic Azad university, zanjan, Iran
10.30497/ies.2026.249666.2333
Abstract
Middle East and North Africa (MENA) countries face challenges in achieving sustainable economic growth due to factors such as dependence on oil rents and inflationary instability. The primary objective of this study is to examine the impact of Sukuk issuance, inflation, the interaction effect between Sukuk and inflation, oil rents, domestic investment, and trade liberalization on the economic growth of selected MENA countries from 2012 to 2021. The analysis focuses on the relationships among these variables and assesses the moderating role of Sukuk under inflationary conditions. Macroeconomic data were obtained from the World Bank, while information regarding Sukuk was compiled from the International Islamic Financial Market (IIFM) for five selected countries in the MENA region. The model incorporates long-run and short-run coefficients, along with an error correction term to measure the speed of adjustment toward long-run equilibrium. Estimation results from the panel Autoregressive Distributed Lag (ARDL) model indicate that Sukuk issuance has a significant positive effect on economic growth and can partially mitigate the negative impacts of inflation. Inflation and oil rents exert a significant negative impact on long-term growth, whereas trade liberalization demonstrates a strong positive effect on economic performance. Finally, domestic investment has failed to provide sufficient support for the production sector in the long run.
Keywords
Economic Growth
Sukuk
Inflation
Oil Rents
Panel Autoregressive Distributed Lag (ARDL) Model
Selected MENA Countries
Islamic Economics Studies Bi-quarterly Journal

Articles in Press, Accepted Manuscript
Available Online from 08 November 2026