The 11th Takaful Conference concluded successfully this week in London. The high powered summit focused on the development of the Islamic Finance and Insurance industries as a possible solution to the global economies plight. Afkar, headed by Iqbal Asaria, presided over a two day summit attended by over 350 of the leading academics thinkers Ulama and practitioners in the field of Islamic Finance.
In a world in which capitalism is arguably in crisis, Islamic economic principles, morality and mechanisms are gaining increasing traction among even Western economists. Not least because Muslims make up 1.2 billion people on the planet and, according to Ogilvy Noor, are one of the most lucrative and under utilized commercial markets in the world today.
> Chief organiser of the event, Iqbal Asaria, said “the continued evolution of Takaful provision in many countries portends a raft of new emerging challenges for the growth of Islamic banking, finance and insurance. He added that there are ” two new developments that can assist in the growth of the takaful and re – takaful industries; potential solution for large real estate and construction projects.” He also confirmed they are close to setting up a Takaful Syndicate at Lloyds of London.
There is, it seems, a key set of variations in the way Takaful models are operated across different countries caused by issues around risk sharing and risk transfer and also the use of Qard e Hasana and delegates discussed potential ways of standardising practise.
Mr Asaria concluded that there was also a broader recognition in the capitalist instutions that debt based economies were not the answer to economic stability and the Islamic emphasis on a more equity based system was one that needed to be explored more seriously. He confirmed that even people like Lord Turner, former head of the FSA, had written a book entitled “Between debt and Devil ” and was entertaining some Islamic concepts against the debt driven economy.
Islam has of course been against both Marxist and Capitalist economic theories over the years but has fallen behind for centuries but its now recovering with an eye focused on adapting to modern realities too. Mr Asaria says the pivotal difference that Islamic economics brings is its insistence that trust is key, and it’s this ethical and moral dimension which Islam can reintroduce to the existing global wealth inequality; which is fundametally breaking the peoples trust in capitalism. He says “it is debt contracts that destroy trust in society and this trust is what needs to be rebuilt”. He argues that in fact this is also what Alan Smith,the father of free market economics, argued in his first book on economics but that this was deliberately ignored in practice by greedy hypercaptalists.
Neoliberalism and its deletion of morality from global economics has even been attacked and declared a “structural sin” by the Pope himself according to Iqbal Asaria.
“Muslims need to adjust to the 21st century economic order without compromising our values” says Mr Asaria The compensation for manslaughter in Islam, for example, involved society covering the costs of an individuals actions in the Holy Prophets times so we have clear principles from which to create a more moral world economics” argued the Conference organiser.
His lifetimes work in developing professional iternationally recognized Takaful infratructures seems to be gaining momentum, in part, due to the worlds economic woes and perhaps this offers an exciting opportunity to reintroduce Prophetic economic solutions to create a more equitable society.