We should not expect the popular uprisings that have swept the Arab region since the beginning of last year to have a quick, positive impact on political and economic systems of the now-troubled countries. It is not easy to fight in one or two years the deeply-rooted corruption in the Arab Spring countries or in other countries which have witnessed social unrest. Indeed, we will observe political struggles here and there and we should expect slower economic growth. Although I am concerned with the struggles that are going on between different political powers in pursuit of more control and influence, I always prefer to concentrate more on the opportunities that could be created for a better future for our generation.
One of those opportunities that has been intensively discussed in the last couple of weeks in the north African region is the integration of massive Islamic financing operations into banking systems. The nearly $1.2 trillion rapidly growing Islamic finance industry in several parts of the globe has taken center stage in the north African region following the Islamist’s recent electoral triumph in Morocco, Tunisia, Libya and Egypt. Economy experts and legislators have claimed that the development of such finance in these countries at the current time would add to their annual gross domestic product (GDP) growth, cut their projected deficit and open tens of thousands of job opportunities for the unemployed. The 15 percent annual growth of the industry globally clearly shows that the experience is having success and that it should be given more concern and care in our region.
Last week, a Malaysian Islamic finance group announced plans to launch a $500 million Islamic fund inEgyptto invest in infrastructure, agriculture and renewable energy projects. InMorocco, a draft bill to integrate Islamic financing operations into the country’s banking system is under preparation and is expected to be implemented by the end of this year, amid reports of the launch of the country’s first fully-fledged Islamic bank in 2013.Tunisiais on the same track. Earlier this month, the Tunisian government announced plans to issue the country’s first Islamic bond before the end of this year in a move to cover part of the anticipated budget deficit.Libyais also no exception. The country’s central bank is reportedly preparing legislation and training staff for introducing a solid Shariah-compliant banking structure within a year from now.
The Islamic finance industry will help the troubled economies of the north African region to revive as they will be able to attract more investments especially from the oil-rich Gulf countries. Of course there will be challenges, one of which is the shortage of qualified scholars in the field. Until now, there seems to be no structured governmental program designed to train them. There is also not much effort being made to educate people about how Islamic finance can maximize their benefits. Yet by setting up a comprehensive vision of the new governments in the region for learning and training, this problem can be solved.
Most Arab people have the idea that Islamic portfolios must not contain shares of firms producing alcohol, weapons, adult entertainment or interest-bearing financial products like their conventional counterparts. But very few of them understand how such an industry can boost economic growth and affect standards of living. It is never too late to learn. There is now an excellent and appropriate opportunity in the north African region to raise awareness about the industry and get the economies of the region back on their feet.
(Hatem Y. Ezz Eldin is a political researcher based in Jeddah. He can be reached at email@example.com)