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Qirad Bonds and Third Party Guarantee: Applications in Financing Development in Muslim Countries سندات القراض وضمان الفريق الثالث وتطبيقاتهما في تمويل التنمية في البلدان الإسلامية

Author

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  • MONZER KAHF

    (Islamic Research and Training Institute, Islamic Development Bank, Jeddah, Saudi Arabia.)

Abstract

The author distinguishes qirad (profit sharing) contract from shirkah (partnership) as the former is characterized by complete separation of ownership from control. He discusses qirad certificates which represent the financier's share in the enterprise and entitle him to a share in profit (or loss) with the right to withdraw the nominal value of the certificate (i.e. the qirad capital) when it is due. Qirad certificates, as financial instruments in an interest free economy, would be more flexible than common stock. The author justifies third party guarantee (e.g. by the state or a collective fund established for this purpose) of the nominal value (i.e. principal) of the qirad certificates. Jordan's experience with qirad certificates is reported with the conclusion that similar instruments would help in financing economic development in Muslim countries. ويوضح البحث الفوارق بين سندات القراض وأسهم المشاركة في أن الأولى لا تحول حامليها أي سلطة إدارية، كما أنها أكثر مرونة لقابليتها للتخصيص لأهداف وأزمنة معينة. ويناقش البحث المبررات الاقتصادية والمزايا لضمان طرف ثالث ( كالدولة مثلاً أو صندوق تأمين تعاوني خاص) للقيمة الاسمية ( رأس المال) لسندات القراض، كما يناقش بتفصيل تجربة الأردن في سندات القراض، ثم الدور الممكن لهذه السندات في تمويل التنمية في البلاد الإسلامية باجتذاب المدخرات، وبتخصيص الموارد المالية بكفاءة، وبتمويل مشروعات القطاع العام.

Suggested Citation

  • Monzer Kahf, 1989. "Qirad Bonds and Third Party Guarantee: Applications in Financing Development in Muslim Countries سندات القراض وضمان الفريق الثالث وتطبيقاتهما في تمويل التنمية في البلدان الإسلامية," Journal of King Abdulaziz University: Islamic Economics, King Abdulaziz University, Islamic Economics Institute., vol. 1(1), pages 45-84, January.
    • Handle: RePEc:abd:kauiea:v:1:y:1989:i:1:no:11:p:45-84
    DOI: 10.4197/islec.1-1.11
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    Cited by:

    1. Khayrullah, Walid, 1994. "Al-Muqaradah Bonds As The Basis Of Profit Sharing," Islamic Economic Studies, The Islamic Research and Training Institute (IRTI), vol. 1, pages 79-102.

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