Structural and Legislative Factors Affecting the Establishment of an Islamic Capital Market in Libya

Abstract

This study aims to analyse the factors influencing the establishment of an Islamic capital market in Libya, based on its role in supporting economic development and providing investment instruments compliant with Sharia principles. The research focused on three main dimensions: Islamic financial instruments, the role of financial intermediaries, and government regulations. The study adopted a descriptive-analytical approach, utilizing a questionnaire directed to employees of the Central Bank of Libya and data analysis through the Statistical Package for the Social Sciences (SPSS). The findings revealed a significant relationship between the availability of financial instruments, the diversity of intermediary institutions, and legislative support, and the feasibility of establishing the market. The study also concluded that success requires a flexible regulatory environment, the strengthening of Islamic banks, and the promotion of financial innovation. It recommended accelerating the development of a comprehensive legal framework, improving infrastructure, and drawing on international experiences to establish a market capable of supporting sustainable development in Libya.