ID :
147443
Tue, 10/26/2010 - 11:06
Auther :
Shortlink :
https://oananews.org//node/147443
The shortlink copeid
ISLAMIC FINANCIAL PRODUCTS MUST BE ON PAR WITH CONVENTIONAL FINANCE, SAYS RAJA NAZRIN
KUALA LUMPUR, Oct 25 (Bernama) -- It is critical for the the Islamic financial
products to be on par with their conventional counterparts in terms of
competitiveness, comprehensiveness and returns.
The Crown Prince of northern state of Perak, Raja Nazrin Shah, said for this to
happen, the markets must be deep and liquid, adding that the Islamic finance
products also have to be commercially driven and based on yield optimisation.
"Expecting such products to be driven purely by religious loyalties cannot and
should not be the primary approach," he said at a special address at the Global
Islamic Finance Forum opened by Prime Minister Najib Razak here Monday.
"They must therefore have broader appeal than just to one section of Muslims.
This has been the general trend in Malaysia," he said.
Raja Nazrin, who is also Malaysia International Islamic Financial Centre (MIFC)
Financial Ambassador, said it is also critical that Islamic financial products
are able to cater to the end-to-end financing requirements of consumers and
businesses.
As such, he said, initiatives like Bursa Suq Al-Sila' -- a commodity trading
platform that facilitates liquidity management of Islamic financial institutions
-- could be utilised in Malaysia to achieve this goal.
Raja Nazrin said Islamic fund management sector has grown from four funds in
1993 to 152 funds in 2010, while the number of Islamic funds in Malaysia has
grown at an average rate of 12.3 per cent yearly since 2006.
He said that although Islamic finance services industry is still small relative
to conventional finance, its development should not be confined to geographical
boundaries and jurisdictions.
"The development of Islamic finance must not be seen as a zero sum game. It is
an industry that has more than enough capacity to sustain and prosper all
participants, provided the seperate Islamic finance jurisdictions work together
to bring about prosperity and growth," he added.
Raja Nazrin said for Islamic finance to prosper, it is important that large
investment organisations such as sovereign wealth funds of Muslim countries take
a developmental view when determining their asset allocations.
For instance, he said, a certain fraction of the funds could be allocated to
those financial institutions with the expertise to invest in Syariah-compliant
investment funds and instruments, as this would enable a greater number of
participants to be sustained and the industry to be broadened.
He also said that it is also timely for industry participants to take greater
responsiblity for human capital development in this sector, which is presently
largely undertaken by the government.
products to be on par with their conventional counterparts in terms of
competitiveness, comprehensiveness and returns.
The Crown Prince of northern state of Perak, Raja Nazrin Shah, said for this to
happen, the markets must be deep and liquid, adding that the Islamic finance
products also have to be commercially driven and based on yield optimisation.
"Expecting such products to be driven purely by religious loyalties cannot and
should not be the primary approach," he said at a special address at the Global
Islamic Finance Forum opened by Prime Minister Najib Razak here Monday.
"They must therefore have broader appeal than just to one section of Muslims.
This has been the general trend in Malaysia," he said.
Raja Nazrin, who is also Malaysia International Islamic Financial Centre (MIFC)
Financial Ambassador, said it is also critical that Islamic financial products
are able to cater to the end-to-end financing requirements of consumers and
businesses.
As such, he said, initiatives like Bursa Suq Al-Sila' -- a commodity trading
platform that facilitates liquidity management of Islamic financial institutions
-- could be utilised in Malaysia to achieve this goal.
Raja Nazrin said Islamic fund management sector has grown from four funds in
1993 to 152 funds in 2010, while the number of Islamic funds in Malaysia has
grown at an average rate of 12.3 per cent yearly since 2006.
He said that although Islamic finance services industry is still small relative
to conventional finance, its development should not be confined to geographical
boundaries and jurisdictions.
"The development of Islamic finance must not be seen as a zero sum game. It is
an industry that has more than enough capacity to sustain and prosper all
participants, provided the seperate Islamic finance jurisdictions work together
to bring about prosperity and growth," he added.
Raja Nazrin said for Islamic finance to prosper, it is important that large
investment organisations such as sovereign wealth funds of Muslim countries take
a developmental view when determining their asset allocations.
For instance, he said, a certain fraction of the funds could be allocated to
those financial institutions with the expertise to invest in Syariah-compliant
investment funds and instruments, as this would enable a greater number of
participants to be sustained and the industry to be broadened.
He also said that it is also timely for industry participants to take greater
responsiblity for human capital development in this sector, which is presently
largely undertaken by the government.
