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Reforming Islamic Finance Industry: Where from? .. Where to? إصلاح صناعة التمويل الإسلامي: من أين؟ .. وإلى أين؟

Author

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  • Ahmed Belouafi

    (Professor of Islamic Economics and Finance, Islamic Economics Institute, King Abdulaziz University, Jeddah, KSA)

Abstract

This essay contributes to the topic of the discussion forum (DF) through the treatment of two points that were spelled out in the framework of the DF provided by the editorial board (EB) of the Journal and elaborated by the lead paper (Hassan, 2020). These are: the institutional set-ups of the sixties vis-à-vis that of the seventies of the development of Islamic finance (IF), and the theory of ‘IF intermediation’. Though the essay shares the same subheadings of the specified points, the treatment and emphasis are somehow different from those dealt within the lead paper and other existing Islamic economics and finance literature. The author discovers that most of the literature does not go beyond the prevailing shallow treatment of the first point; historical records and narrations of the two experiments. For this reason, some Muslim economists consider the significance of Mit-Ghamr local savings bank as ‘only historical for the time being’ (Ahmad, Rahman, & Valie, 1995, p. 352). In pursuing such a synthesis, the author hopes to draw some insightful lessons that can guide us in bringing an ‘important venue’ to the existing proposals for the reform agenda of IF rather than indulging into a ‘vicious circle’ that does not transcend a few factors that have been in circulation for some time without reaching proper resolve. It is also hoped that the explored dimensions are given due consideration in the discussions surrounding the future of IF in theory and practice. تُسهم هذه المُداخلة في منتدى النقاش الذي خُصص لهذا العدد من خلال نقطتين أساسيتين تمت الإشارة لهما في خطاب الدعوة الذي وُجه للكاتب من قبل هيئة التحرير للمشاركة في منتدى النقاش، والتعرض لهما من قبل الورقة الرئيسة لرسني حسن (Rusni Hassan, 2020). هاتان النقطتان هما: النشأة المؤسسية لصناعة التمويل الإسلامي في ستينيات وسبعينيات القرن الماضي، و"نظرية الوساطة المالية الإسلامية". وعلى الرغم من التشابه في عناوين تَيْنَك النقطتين بين الورقة الرئيسة وغيرها من الأدبيات التي عالجت موضوع إصلاح منظومة التمويل الإسلامي إلا أن المعالجة في هذه الورقة مختلفة. لقد اكتشف الكاتب أن معظم الكتابات التي تعرضت لمسألة نشأة التمويل الإسلامي في فترتي الستينيات والسبعينيات تتناولها بطريقة تاريخية "رتيبة" لا تتعدى مسألة السرد لما جرى؛ بل إن بعض الاقتصاديين المسلمين ينظر إلى تجربة ميت غمر على أنها "مجرد حدث تاريخي الآن"، (Ahmad, Rahman, and Valie, 1995, p. 352). إن الورقة تُلفت الأنظار إلى أن العودة لهذه التجربة وما صاحبها في ستينيات القرن الماضي، ومقارنتها بتجربة السبعينيات تُتيح الفرصة للكشف عن العديد من الدروس المهمة التي يمكن الاستفادة منها في النقاش الدائر حول إصلاح صناعة التمويل الإسلامي. لأنها – حسب اعتقاد الكاتب – ستنقلنا من "الحلقة المُفرغة" التي تركز النقاش حولها والمتمثلة في التركيز على بضعة عناصر مثل هيئات الرقابة الشرعية ودورها، ومحاكاة منتجات التمويل الربوي (التقليدي)، إلى أفق أرحب ينظر لمدى ملاءمة المؤسسات القائمة لتلبية الحاجات المتعددة والمتنوعة للمجتمعات المسلمة.

Suggested Citation

  • Ahmed Belouafi, 2020. "Reforming Islamic Finance Industry: Where from? .. Where to? إصلاح صناعة التمويل الإسلامي: من أين؟ .. وإلى أين؟," Journal of King Abdulaziz University: Islamic Economics, King Abdulaziz University, Islamic Economics Institute., vol. 33(2), pages 121-136, July.
    • Handle: RePEc:abd:kauiea:v:33:y:2020:i:2:no:9:p:121-136
    DOI: 10.4197/Islec.33-2.9
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    References listed on IDEAS

    as
    1. Rusni Hassan, 2020. "Reforming Islamic Finance: Why and How? إصلاح التمويل الإسلامي: لماذا و كيف؟," Journal of King Abdulaziz University: Islamic Economics, King Abdulaziz University, Islamic Economics Institute., vol. 33(2), pages 67-80, July.
    2. Ruud A. De Mooij, 2012. "Tax Biases to Debt Finance: Assessing the Problem, Finding Solutions," Fiscal Studies, Institute for Fiscal Studies, vol. 33(4), pages 489-512, December.
    3. Hechem Ajmi & Salina Kassim & Hassanuddeen Abdul Aziz & Walid Mansour, 2019. "A Literature Review of Financial Contracting Theory from the Islamic and Conventional Overviews: Contributions, Gaps, and Perspectives استعراض أدبيات نظرية التعاقد المالي من المنظور الإسلامي والتقليدي," Journal of King Abdulaziz University: Islamic Economics, King Abdulaziz University, Islamic Economics Institute., vol. 32(2), pages 25-42, January.
    4. Robert C. Merton, 1995. "A Functional Perspective of Financial Intermediation," Financial Management, Financial Management Association, vol. 24(2), Summer.
    5. Boris Cournède & Oliver Denk & Peter Hoeller, 2015. "Finance and Inclusive Growth," OECD Economic Policy Papers 14, OECD Publishing.
    6. Ruud A. De Mooij, 2012. "Tax Biases to Debt Finance: Assessing the Problem, Finding Solutions," Fiscal Studies, Institute for Fiscal Studies, vol. 33(4), pages 489-512, December.
    7. Abdelkader Chachi, 2005. "Origin and Development of Commercial and Islamic Banking Operations أصل وتطور العمليات المصرفية التجارية والإسلامية," Journal of King Abdulaziz University: Islamic Economics, King Abdulaziz University, Islamic Economics Institute., vol. 18(2), pages 3-25, January.
    8. Ahmed Mahdi Belouafi & Chaouki Bourakba & Karima Saci, 2015. "Islamic Finance and Financial Stability: A Review of the Literature التمويل الإسلامي والاستقرار المالي: مراجعة الأدبيات النظرية," Journal of King Abdulaziz University: Islamic Economics, King Abdulaziz University, Islamic Economics Institute., vol. 28(2), pages 3-42, July.
    9. Xing, Xiaoyun & Xiong, Wanting & Chen, Liujun & Chen, Jiawei & Wang, Yougui & Stanley, H. Eugene, 2018. "Money circulation and debt circulation: A restatement of quantity theory of money," Economics Discussion Papers 2018-1, Kiel Institute for the World Economy (IfW Kiel).
    10. Mohammad Anas Al-Zarqa, 2017. "Yes to Real Banking Murabahah Even with a binding promise بلى للمرابحة المصرفية الحقيقية - ولو مـُلزِمةً," Chapters of books published by the Islamic Economics Institute, KAAU or its faculty members., in: Islamic Economics Institute (ed.),Lectures in Islamic Economics and Finance, Selected From Wednesday Seminars-11 محاضرات في الاقتصاد والتمويل الإسلامي - مختارة من حوارات الأربعاء - 11, edition 1, chapter 1, pages 35-70, King Abdulaziz University, Islamic Economics Institute..
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    More about this item

    Keywords

    Islamic finance; Local savings bank; Profit and loss sharing (PLS); Social transformation; Islamic Finance reform; Asset backing. التمويل الإسلامي، بنوك الادخار المحلية، تقاسم الربح والخسارة، التغيير الاجتماعي، إصلاح التمويل الإسلامي، ارتباط التمويل بالنشاط الاقتصادي.;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • N27 - Economic History - - Financial Markets and Institutions - - - Africa; Oceania
    • Z12 - Other Special Topics - - Cultural Economics - - - Religion

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