MALAYSIA NEEDS TO EXTEND ISLAMIC FINANCE LEADERSHIP

KUALA LUMPUR, Jan 12 (Bernama) -- Malaysia needs to rethink existing
paradigm to solidify its leadership in the Islamic finance industry as more
countries are jumping into the bandwagon.

"The race is on (in the Islamic finance sector). There is stiff competition
from other financial centres," Bank Negara Malaysia (Central Bank)'s assistant
governor Muhammad Ibrahim said Monday.

Last November, French Finance Minister Christine Lagarde announced France's
intention to make Paris "the capital of Islamic finance".

The French Senate also announced that it was looking at ways to eliminate
legal hurdles, particularly levies, for Islamic financial services and products
in France and the potential for listing companies on the Paris Stock Exchange.

The United Kingdom is in a consultation process to issue sovereign sukuk, he
said.

Nearer to home, Muhammad said Singapore has launched the Islamic Electronic
Trading Fund, Hong Kong aimeds to be an Islamic financial hub and Japan has
approved a new law allowing banks to offer Islamic finance.

In order to remain the leading Islamic finance centre, he said that
Malaysia, among other things, should globalise its education system as quality
of education will determine the country's competitive edge.

"(We should also) attract high profile and talented acedemicians and
researchers, promote the culture of research and thirst for knowledge, and
continuously benchmark our education system," he said.

Malaysia, he added, should also create a framework to attract the best and
brightest talent to the country.

Muhammad also said that there should also be no gaps between policies and
implementation.

"Strong vision should be supported by pragmatic execution of policies by
implementation agencies and the ability to make structural policy changes in a
timely manner," he said.

Such efforts are possible as Malaysia already has the first-mover advantage,
Muhammad said.

"Malaysia is by far the largest centre for sukuk issuance in the world. The
total annual Islamic money market transaction exceeds RM1 trillion and the
industry has contributed to overall economic growth," he said. (US$1=RM3.60)
-- BERNAMA