One of the lessons that we have learned from the global financial crisis is that we do not know which kind of financial institutions is safest and most efficient – indeed, we have assumed a hierarchy of financial institutions that progress from basic barter and goods storage, through banking, to the capital markets, the ‘highest’ form of financial intermediation – said Christopher Hartwell, President of CASE – Center for Social and Economic Research while delivering the opening speech during the conference ‘Islamic finance. A new solution for entrepreneurs and investors?’ that took place on 20th of November 2014.
Religion is an intensely personal decision, but it influences the public sphere. We talk of religion as a social institution, one that is concerned with the rewards or punishments of the next life, but throughout history, religion has influenced this life. (…) And given that finance is basically the tradeoff between time and money, it makes sense for religion, which places a value on time, to be linked to financial sector development. Net present value, interest rates, just talk about the intertemporal value of money – he added.
Presentation ‘Contemporary approach to Islamic finance’ given by the first keynote speaker Barbara Chamot, Director of Polish Information and Foreign Investment Agency’s Department of Economic Information, dealt with causes of a rapid development of Islamic finance around the world in recent years. According to Barbara Chamot, outstanding success of so-called unconventional finance derives mainly from the global crisis outcomes, namely disapproval of financial institution’s unethical practices (too much focus on speculation, involvement in risky transactions, fixing interbank benchmark rates etc.) and extremely low interest rates. As she explained, due to the prohibition of interest rate and ‘profit and loss sharing’ principle, Islamic financial instruments are more ethical compared to the conventional ones.
The role of finance is to stimulate sustainable economic growth, not to pack bankers’ pockets with money, which is why people became interested in products that are used for investment projects. In this unconventional system, banks do not simply grant a loan – they engage in a particular venture as investors and take responsibility (proportional to their input) for the possible failure (they may not only lose their profits but also, if particular company go bust, all the capital). Global attention turned to Islamic instruments because interest rates in developed economies reached an all-time low (in some states they are in fact negative). People discovered that some products, although they do not involve interest rates, still yield profits. In the unconventional system money is made not simply on charging others for taking loans but on profits generated by successful ventures.
The second presentation ‘Regulatory challenges’, delivered by Katarzyna Sid?o, PhD candidate at University of Warsaw, addressed the regulatory environment in the Islamic financial sector. Unlike the conventional market, the Islamic one is not regulated by one set of universal rules. Every entity offering Islamic financial products must abide by regulations issued by its own Sharia Board that decides whether a given instrument or transaction is sharia compliant or not. At the international level, three main regulatory organizations function: Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), Islamic Financial Services Board (ISFB) and International Islamic Financial Market (IIFM), which by virtue of issuing guidelines and standards shape Islamic financial institutions’ operations. Furthermore, each Islamic financial institution must adhere to the domestic law of the country which it operates in. As a result, Islamic instruments are not standardized and differ significantly across the world.
As it was showed, Islamic finance is growing rapidly also in Europe, mainly in the United Kingdom. This country has taken many steps to facilitate development of the sector. At the beginning of 21st century the Bank of England established Islamic Finance Working Group which was to study the possibility of promoting further the operation of Islamic financial institutions in England. In 2005 Stamp Duty Land Tax provisions were extended to equity sharing arrangements Murabaha registered by the government as a purchase and resale arrangement. One year later the government registered diminishing shared ownership (diminishing Musharaka) as property or asset financing arrangements. The UK also tries to create an image of a country that truly wants to attract Islamic finance. It set up UK Islamic Finance Secretariat and Minister-led Islamic Finance Task Force (created in 2011 and 2013 respectively) to promote the UK as a global gateway for the unconventional finance. Even more importantly, this year it started to issue sovereign Sukuk, the Islamic equivalent of a bond, as the first country outside the Muslim world.
During the lively debate that ensued after the presentations our guests discussed prospects of and challenges to Islamic finance development as well as its expansion in Europe.
We would like to inform that analysis ‘Islamic finance. A solution for sustainable economic development of the Gulf Cooperation Council countries’ will be published in December.
To be happy it is important to be healthy. How can medicines help up? It isn’t tight for immigrants to purchase drugs online. How it is possible? For example Xylocaine causes loss of feeling in an area of your body. Given during childbirth. Secondly treats emergency soul rhythm problems. Usually, if you have lost the charisma, charm to a particular partner, treatment options like Cialis to improve potency is unlikely to help him back. Cialis is a drug used to treat different troubles. What do you already know about sildenafil vs tadalafil? Apparently either adult has heard about vardenafil vs sildenafil. (Read more http://rootinfonline.com/cialis-for-daily-use.html). Like all other medications, Cialis is also according of it’s active ingredient. While the medicine is credited with nerve hurt, it can also cause sexual disorder. The most common possibly serious side effects of such medicaments like Cialis is stuffy or runny nose. Tell local physician if you have any unwanted side effect that bothers you. Discuss the matter with your health care professional to ensure that you can use this drug. Some tests can be used to extent of male sexual problems.
Katarzyna Czupa jest ekspertem Centrum Inicjatyw Międzynarodowych ds. Bliskiego Wschodu oraz koordynatorem projektu „Let’s talk about Islamic finance”. Obecnie pracuje jako młodszy analityk w firmie Analizy Online, gdzie zajmuje się analizą rynku funduszy inwestycyjnych. W okresie od kwietnia do listopada 2016 r. pracowała na stanowisku młodszego analityka w Domu Maklerskim Banku Zachodniego WBK, gdzie była odpowiedzialna za analizy rynkowe oraz wycenę spółek. W okresie od stycznia 2014 r. do kwietnia 2016 r. pracowała w CASE – Centrum Analiz Społeczno-Ekonomicznych na stanowisku koordynatora ds. projektów oraz asystenta naukowego. Obecnie realizuje studia doktoranckie w Kolegium Ekonomiczno-Społecznym Szkoły Głównej Handlowej. Jest absolwentką kierunków finanse i rachunkowość (Szkoła Główna Handlowa) oraz stosunki międzynarodowe (Uniwersytet Warszawski). W 2013 roku otrzymała stypendium Ministra Nauki i Szkolnictwa Wyższego za wybitne osiągnięcia naukowe.