Hiccups and opportunities .. Islamic finance at the dialogue table at the Doha Forum

Imad Murad - Doha

“The Arab and Islamic countries should take the initiative to lead the growth in the field of Islamic finance,” an invitation issued by the session of “Islamic Finance… Trends and Opportunities” within the work of the Doha Forum 2019 which ended yesterday in Qatar.

The session dealt with how Islamic finance can be in line with the new technological foundations in the financial field, and the customer has a full culture of how Islamic finance and its conditions are discussed, with a discussion on how to facilitate Islamic transactions in line with developments in all fields.

Participants in the session also addressed the path of Islamic finance that began in the seventies of the last century and developed until the size of the sector reached nearly 2.3 trillion dollars, and the obstacles that this sector was exposed to recently with low oil prices and the Gulf region affected one of the most important citizens of this sector with that decline.

Malaysia - according to the participants - was the only exception to the decline in growth in Islamic finance for its acquisition of the largest share of Islamic financial and banking transactions, noting that the growth of Sukuk issuances was driven by Asian Islamic countries such as Malaysia and Indonesia.

Standardization
The participants pointed out that there are concerns and fears in the Council of Islamic Financial Services regarding the use of technology in the field of Islamic financial services, because of the various risks involved in this technology, stressing the importance of Sharia scholars meeting with experts and specialists in the field of financial transactions in order to work to unify standards and legislation.

During his intervention before the session, the CEO of the QFC Authority, Youssef Mohamed Al-Jaidah, affirmed that the State of Qatar has a distinct infrastructure in the field of Islamic banking, as it is replete with colleges specialized in the field of Islamic and Islamic sciences in addition to the bodies regulating Islamic banking, as well as having all the foundations of cities Islamic Finance, in addition to the premium platform owned by the Qatar Financial Center.

The CEO of the Qatar Financial Center Authority revealed his country's intention to sign a framework agreement with Malaysia on the sidelines of the expected Islamic summit there, and this agreement falls within the framework of strengthening cooperation in the field of Islamic finance, pointing to a similar agreement signed by the Qatar Financial Center with the Turkish financial center, as a step To create an Islamic financial alliance between the three countries.

Al-Jaidah spoke during the intervention about the numbers recorded in Qatar in the Islamic finance sector, explaining that the total Islamic banking assets amounted to about $ 127 billion, most of which are concentrated in banks at about $ 107 billion.

The value of Takaful amounted to about one billion dollars, about 3 billion dollars in Sukuk this year, and about 20 billion dollars in exceptional Sukuk, so that the Islamic assets in total constitute about 32% of the traditional assets in the state.

The CEO of the Qatar Financial Center Authority called for the need to use technology in Islamic finance, especially as financial technology provides many important opportunities that can help developing countries to rise and access through block chains to Islamic financing sources.

He pointed to the inclusion of a group of Qatari Islamic bonds on the London Stock Exchange, which was very popular with investors. He also spoke about the merger of Barwa Bank and Qatar International Bank, which resulted in an Islamic banking entity that is the largest of its kind.

Development paths
Senior Director of "Standard & Poor's" Dr. Mohamed Damak agreed with Al-Gayed's statements regarding the necessity of providing all modern technology in the Islamic finance sector, stressing that the main engine of Islamic finance is based in the Arab and Islamic regions, and they should find a general framework for issuing Islamic bonds.

Damak identified in an interview with Al-Jazeera Net several paths that can develop the Islamic finance sector, the first of which is comprehensive unification in all Islamic transactions, as well as entering the field of financial technology "Fintech", in addition to green instruments and governance, especially that Islamic banks are subject to a different level of Governance, which is Sharia, which is not something that works in all countries of the world.

Finally, the social factor is to take advantage of the endowment and Zakat, which are tools that were not used properly in Islamic finance.

As for the Executive Director of the International Academy for Sharia Research for Islamic Finance in Malaysia, Dr. Muhammad Akram Lal-Din, he talked about Malaysia's experience in the field of Islamic finance, explaining that his country opened the first Islamic bank in 1983, but the sector has made great strides during this period, amid plans to increase the proportion of banks In the year 2020 to 40% of the size of the financial sector in the country, considering that his country is the largest exporter of Islamic sukuk.