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Sharia Finance & Economic Integration : Islam’s answer to the crisis

09 Déc

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Major new ideas or radical change tend not to happen in normal times when systems are running smoothly and people are generally content. It is in times of crisis that great change is usually triggered. We are in a time of crisis. Hardly a day passes without new tidings of financial disaster. The latest grim news is from the German insurance industry that predicts that 200,000 businesses will go bust in Europe and 62,000 in the US next year — which suggests that 2009 will not see the start of an economic recovery. Perhaps, given that we live in such “interesting” economic times, it is not so surprising then that on the same day the German report was published came the suggestion, from Saudi Arabia’s Grand Mufti Abdul Aziz Al-Asheikh, that Muslim countries form an economic bloc.

The grand mufti’s comments, made in his address to the nearly three million pilgrims assembled at Mount Arafat for what is the spiritual climax of the annual Haj, has been picked up by the media across the world as if his sermon was political and economic. It was not. The main theme was a call to Muslims to show the world “the bright face of Islam”, to demonstrate forgiveness, love and peace and to shun extremism which can lead to terrorism.

It is far from the first time that the grand mufti has made such calls. What was new, however — and it clearly explains the sudden global interest — is his accompanying comments on the world’s present economic woes, the charge being that they have been brought about by human greed. Specifically it is the use of interest as the foundation of international finance that is to blame. From there has come the proposition that Muslim countries should reject interest, adopt Shariah-compliant economics and unite to form what could become, as he put it, a “formidable economic power”.

The grand mufti is not alone in taking a moral approach to the crisis; other religious leaders around the world have also blamed it on human greed. Nor is the idea of an Islamic economic union new. Calls for one regularly surface. Former Pakistani Prime Minister Shaukat Aziz is a keen supporter of the idea. But the ideas are timely. The remarkable growth in Islamic banking in recent years was because an increasing number of concerned Muslims with financial muscle could see that many aspects of international banking and finance were inimical to Islamic law. They demanded an alternative. But, growing though they are, Shariah-compliant economics has remained the minority system. The Western economic order dominates — across the Muslim world too.

The big difference now, however, is that that old order is seen to have demonstrably failed. In these uncertain times, governments and states are looking for ways to stimulate fresh economic growth. In Muslim countries, it is bound to result in renewed interest in Islamic finance and in an economic union. Given the present circumstances, perhaps such a bloc is an idea whose time has come. Certainly it deserves serious consideration. Of course, it would not be a good thing for the world to be divided into potentially competing blocs. That would be dangerous. Large, collaborating blocs, however, are a different matter. Not that an Islamic economic union could happen overnight. It would have to begin small and grow — the European Union’s path to its present existence. How it might come about is one thing; enthusiasm for it is another. In the present climate, it would indeed be remarkable if support for the notion does not grow.

Source: Arab News, 9 December 2008

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“There is nothing more powerful than an idea whose time has come.”

« Rien n’est plus puissant qu’une idée dont le moment est venu. »
Victor Hugo

 
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Publié par le décembre 9, 2008 dans International

 

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