Dubai: Industry experts discussed challenges faced by Islamic economy and also opportunities available but emphasised that standardisation will help boost Islamic banking.
Islamic banking has been growing faster than conventional banking despite the fact that institutions are not targeting right geography, they said at the second edition of the Global Islamic Economy Summit, or GIES, in Dubai on Monday.
His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, inaugurated the summit.
Over 2,000 policymakers, thinkers and business leaders gathered to take part in the two-day summit hosted by the Dubai Chamber of Commerce and Industry, the Dubai Islamic Economy Development Centre (DIEDC) and Thomson Reuters.
The summit began with welcome remarks from Abdulla Al Awar, CEO of the DIEDC, followed by a keynote address by Mubarak Rashid Al Mansoori, Governor of the Central Bank of UAE, who highlighted that UAE is globally recognised for having one of the healthiest Islamic ecosystems.
"Today, we look forward to global standards for Islamic products and services, and the provision of a stable and effective framework for the Islamic economy governed by appropriate legislative and regulatory organisations, and supported by studies, research, scientific knowledge and innovation. This pace of development will help meet the constantly evolving needs of markets, allowing this initiative to become a truly independent economy in and of itself, rather than merely being a subset of the broader global economy," said Sami Al Qamzi, director-general of the Dubai Department of Economic Development and Deputy CEO of the DIEDC.
Majid Saif Al Ghurair, chairman of the Dubai Chamber, pointed out that the Islamic economy is a way of life experienced by over 1.6 billion Muslims around the world and its model cuts across all aspects of economic and social lifestyle of individuals and communities. This model has proved its excellence during the global financial crisis, making it a perfect choice for Muslims and non-Muslims alike. The plenary session featured a vigorous debate amongst CEOs of Abu Dhabi Islamic Bank, Dubai Islamic Bank, Emirates Islamic Bank and Kuwait Finance House on the relevance of Islamic finance to other sectors within the Islamic economy.
The session, moderated by Axel Threlfall, editor-at-large at Reuters UK, saw Tirad Al Mahmood, Dr Adnan Chilwan, Jamal bin Ghalaita and Mazin Al Nahedh offer perspectives from a range of stakeholders in the Islamic finance industry and present their case on how they believe Islamic finance can engage with the Islamic economy.
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Chilwan said: "We are not targeting right geography."
Talking about the top Muslim-populated countries Indonesia and India, he said: "If you sell lollipop, you will become billionaire." He also talked about the potential growth opportunities in Africa.
Bin Ghalaita said: "We are pro-active and doing a lot of things and we can do more."
Al Mahmood said: "Islamic banking has been growing faster than conventional banks. The potential is far better than people think."
Nobel Laureate and founder of Grameen Bank in Bangladesh Prof Muhammad Yunus was the special guest.
To the question of harnessing talent within the Islamic economy, Yunus said: "The only answer is to create a new institution to serve the people that are underserved or never served."
"There needs to be an independent regulatory authority for microfinance in every country - pan-regional legislation will not work, it will only serve to encourage countries to start thinking about the poor and recognise that banking can be a solution to human problems."
Nadim Najjar, managing director for the Middle East and North Africa at Thomson Reuters, added: "Today's discussions have led to interesting outcomes, inciting a great degree of interest in the audience amongst whom were policymakers and business owners looking for clear direction on capitalising on the opportunities."
Following on from the past edition of the summit and last year's roundtables, the Islamic Economy Awards took centre stage at the summit on Monday. The awards, presented by Shaikh Mohammed, recognised initiatives and ideas pertaining to eight key categories that have served to enhance bilateral trade and investment relations between Islamic nations.
The winners of the awards were the Dubai International Financial Centre for Money & Finance; Chemical Company of Malaysia for Food & Health; Unity Productions Foundation for Media; Hajjnet for Hospitality & Tourism; Centre for Zakat Management for Waqf & Endowments; Affinis Labs for SME Development; Amanie Advisors for Islamic Economy Knowledge Infrastructure; and Gould for Islamic Arts. Additionally, the 'Lifetime Achievement Award' was presented to Iqbal Khan, founder and CEO of Fajr Capital, for outstanding contributions to the Islamic economy.
