The government-owned Japan Bank for International Cooperation (JBIC) is hoping to launch a ground-breaking Islamic bond, or 'sukuk', that promises to pave the way for Middle Eastern petro-dollars to flow into Asia. Does the bond issue mean Tokyo will emerge as an Islamic finance centre to rival the likes of Singapore or Malaysia?

Industry watchers say it's unlikely Japan will become an Islamic finance hub in this part of the world as the country is still very much a domestic market. With that in mind, if structured finance work is your speciality and you take an interest in Islamic banking, you might be better off getting a position in more developed markets like Malaysia and Singapore.

Patrick Lee, head of investment banking for Singapore and Malaysia at UBS, says: “If you look at foreign listings in Japan, it has kind of dried up. So I don't see it taking on a role as an international Islamic financial centre. Singapore has more potential as it's an international financial centre. But to be frank, Malaysia has done much more and progressed much faster, so Malaysia is in the lead among other countries.”

Richard Mills, chairman of recruitment agency Chalré Associates, believes the sukuk exercise will not have an impact on recruitment. There would have to be something large and sustainable for it to affect recruiting, he says.

Y. Iwata of Nomura Securities in Tokyo feels there is now a growing interest in Islamic finance in Japan. “If the prejudices, misunderstandings, and operational challenges of Islamic finance can be overcome, we think Japanese public bodies and private sector corporations may start to consider Islamic finance an effective method of attracting the large flow of funds from oil-producing states,” he writes in a report.