IN LINE with efforts to promote Malaysia as an Islamic financial centre, investors are being encouraged to use the country as a gateway for investment and base for financial activities.
“Let’s jointly promote Islamic finance in the international market and the mutual acceptance of each others’ financial products while marketing them together,” the Crown Prince of Perak, Raja Dr Nazrin Shah ibni Sultan Azlan Shah, urged.
He said Malaysia is generally a business-friendly place and there are lots of attractive policies in place for foreign investors, wanting to invest in the country.
Raja Dr Nazrin Shah, who is also the financial ambassador of the Malaysia International Islamic Financial Centre (MIFC), led a roadshow delegation comprising regulators and industry players to Qatar and Bahrain on Oct 10-15.
Tracing the development of Islamic finance in Malaysia, he said in 1983, the first Islamic bank was established in the country and in the 90s, banks were invited to open windows within their system to start trading in Islamic products.
He said the MIFC intiative was established in 2006 to establish Malaysia as the centre for Islamic finance and to integrate the country within the Islamic financial community.
“We (Malaysia) now have an Islamic capital market and are the largest producer of sukuk (Islamic bonds). I think 60 per cent of sukuk originates from Malaysia. We have Islamic insurance, re-insurance and asset management, developed over the last few years,” he said.
Raja Dr Nazrin Shah said the underlying principle of Islamic finance is basically to prohibit excessive risk taking and speculative activities. He said non-Muslims are also beginning to use Islamic products, especially in Malaysia.
“I think we have progressed much and Malaysia is the centre for Islamic finance,” he said, when asked how far had Malaysia come as an international Islamic financial base.
He also said there was a need for greater collaboration and dialogue to promote Islamic finance in international markets. “These are the basic pillars that have to be considered on a continuous basis in order to promote Islamic finance,” he added. “In 1997, Malaysia went through a financial crisis and that was a wake up for us. Since 1997, we have strengthened our financial system while putting in place stronger regulatory and supervisory considerations, for greater corporate governance and best practices.”
source : Btimes