ICIE09: World ‘desperately’ looking for sustainable financial system

By Habhajan Singh
The world is desperately looking for a viable solution towards a sustainable financial system now that is in the midst of the worst financial crisis, said Organisation of Islamic Conference (OIC) secretary general Prof Ekmeleddin Ihsanoglu.
In this connection, he told a two-day conference on Islamic finance that the Islamic banking and finance now has an opportunity to be an important stakeholder of what he calls the new world financial order in regaining trust and confidence.
He said that a number of experts and Islamic bank officials have confirmed that Islamic banking has not been affected by the global financial crisis and that "bad effects" would be limited due to the nature of Islamic banking.
"The on-going global financial crisis promted many to question the integrity and the sustainability of the existing international monetary and financial system," he said in his keynote address at the International Conference on Islamic Economics and Economies of the OIC Countries (ICIE) 2009 in Kuala Lumpur on April 28.
The two-day conference, which ended yesterday [April 29], was jointly organised by International Islamic University Malaysia's (IIUM) economics department and Islamic Research and Training Institute (IRTI) of the the Islamic Development Bank Group.
Dr Abbas Mirakhor, a professor of economics and a former executive director at the International Monetary Fund (IMF), was the keynote speaker on the second day.
In his speech, Ihsanoglu noted that Islamic banking and finance has some way to go before it can be a serious alternative to conventional finance and banking.
He said OIC has played a role in areas like dialogue among civilisations, defending the image of Islam and combating the phenomenon of Islamophobia.
"In the face of the mounting phenomenon of Islamophobia in the West, the OIC has placed this issues at the top of its priorities and pre-occupations by conducting a large-scale world-wide effort to confront it.
"We have been able to achieve convincing progress at all levels, mainly at the UN Human Rights Council in Geneva and the UN General Assembly in New York," he said.
OIC is the second largest intergovernmental organisation after the United Nations which has membership of 57 states spread over four continents. ICIE 2009 had four focus areas.
In Islamic economics, it is to evaluate the current state of art in the various sub-areas, from environmental economics to monetary economics, and theoretical and policy studies dealing with the development of Islamic economics.
On Islamic banking and finance, it is looking at the fundamentals of Islamic finance, regulatory structures, Shariah compliant investment, takaful, risk management, branding opportunities for Shariah compliant products, socially responsible investment strategy, wealth management, sukuk, zakat, hedge funds and derivatives, housing finance and Shariah compliant mortgage products.
On economies of the OIC countries, the conference is evaluating the performance and current status of economic development in the OIC member countries, and the role of the OIC and IDB in facilitating development in OIC countries.
The fourth area is in the economic cooperation among the OIC countries where it looks at the current status, challenges and problems, strategies to increase cooperation and trade, and the potential role of the OIC and IDB in enhancing economic integration.

(This story appeared in The Malaysian Reserve on Apr 30, 2009. The Malaysian Reserve is a daily business/finance newspaper published out of Kuala Lumpur, with a sectoral page on Islamic finance on Mondays, edited by Habhajan Singh)