ID :
149465
Thu, 11/11/2010 - 02:58
Auther :
Shortlink :
https://oananews.org//node/149465
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PACE OF DEVELOPMENT OF ISLAMIC FINANCIAL MART GATHERS MOMENTUM
KUALA LUMPUR, Nov 10 (Bernama) -- The pace of development of the Islamic
financial market has gathered momentum with the formation of various
international Islamic organisations to study and promote it.
Gatehouse Bank chief executive officer, Richard Thomas, said the world
financial system generally favoured debt-related products to equity products
and this would promote financial instability.
"The Islamic economic model has more balance as it has more equity products
and should be a safer economic model for the world," he told a media briefing at
the World Congress Accountants 2010 here Wednesday.
Thomas said the Islamic financial market also needed regulators to give
equity-related products the same tax advantages as the debt-related ones.
He said the market recorded faster growth compared to any other financial
system although it still lacked instruments and infrastructure.
"In such a period of extraordinary challenges and uncertainties, Islamic
finance has continued its global expansion and development," he said.
Paul Wouters, counsel of Bener Law Office Istanbul (Turkey), said Islamic
finance would serve as an alternative economic model as it has fewer bubbles and
burst, unlike Western-style economic model
"The conventional market deals with financial debt trading. It creates
financial instrument securitisation debts. It also creates several layers of
finance that weres built of nothing but just repackaging." he said.
Islamic finance, he said, allowed securitisation of debt and asset but not
the layering.
"This is why balloons will normally never happen in Islamic finance," he
said.
Etsuaki Yoshida, deputy head, Africa and the Middle East, at Japan Bank for
International Cooperation, however, said the Islamic finance in the market still
lacked liquidity as well as hedging tools.
The global Islamic financial market is estimated to be worth US$230 billion,
with an annual growth rate of 12 per cent to 15 per cent. Islamic funds in
global financial institutions are said to be worth US$1.3 trillion.
The Islamic banking system currently accounts for 20 per cent of Malaysia's
financial system while the sukuk market accounts for over 50 per cent of the
bond market.
It runs parallel to the conventional financial system.
-- BERNAMA
financial market has gathered momentum with the formation of various
international Islamic organisations to study and promote it.
Gatehouse Bank chief executive officer, Richard Thomas, said the world
financial system generally favoured debt-related products to equity products
and this would promote financial instability.
"The Islamic economic model has more balance as it has more equity products
and should be a safer economic model for the world," he told a media briefing at
the World Congress Accountants 2010 here Wednesday.
Thomas said the Islamic financial market also needed regulators to give
equity-related products the same tax advantages as the debt-related ones.
He said the market recorded faster growth compared to any other financial
system although it still lacked instruments and infrastructure.
"In such a period of extraordinary challenges and uncertainties, Islamic
finance has continued its global expansion and development," he said.
Paul Wouters, counsel of Bener Law Office Istanbul (Turkey), said Islamic
finance would serve as an alternative economic model as it has fewer bubbles and
burst, unlike Western-style economic model
"The conventional market deals with financial debt trading. It creates
financial instrument securitisation debts. It also creates several layers of
finance that weres built of nothing but just repackaging." he said.
Islamic finance, he said, allowed securitisation of debt and asset but not
the layering.
"This is why balloons will normally never happen in Islamic finance," he
said.
Etsuaki Yoshida, deputy head, Africa and the Middle East, at Japan Bank for
International Cooperation, however, said the Islamic finance in the market still
lacked liquidity as well as hedging tools.
The global Islamic financial market is estimated to be worth US$230 billion,
with an annual growth rate of 12 per cent to 15 per cent. Islamic funds in
global financial institutions are said to be worth US$1.3 trillion.
The Islamic banking system currently accounts for 20 per cent of Malaysia's
financial system while the sukuk market accounts for over 50 per cent of the
bond market.
It runs parallel to the conventional financial system.
-- BERNAMA
