IslamicFinance.de

The Islamic Corporation for the Development of the Private sector (ICD) and OJSC Agroinvestbank of the Republic of Tajikistan signed a Memorandum of Understanding for cooperation to consider extension of a Line of Financing facility to OJSC Agroinvestbank as part of the country programme allocation of USD 25 million for the Republic of Tajikistan. The Line of Financing facility will be extended by OJSC Agroinvestbank to the SMEs sector to project's in industrial, communication, technology, health, construction and agricultural sectors. Previously ICD extended a total of USD 11.5 million Line of Financing facility for the development of Small and Medium Enterprises in Tajikistan which demonstrates ICD’s firm commitment to develop the private sector in its member countries.

Nassim Nicholas Taleb says financial institutions today are less fragile than they were a few years ago. This isn’t because they got better at understanding risk but because, since 2009, banks have been shedding their exposures to extreme events. Monetary policy made itself ineffective with low interest rates. There’s no evidence that “zero” interest rates are better than, say, 2% or 3%, as the Federal Reserve may be realizing. Low interest rates invite speculation in assets such as junk bonds, real estate and emerging market securities. We also need to focus on risks in the physical world. Terrorism is a problem we’re managing, but epidemics such as Ebola are patently not. Finally, climate volatility will produce some nonlinear effects, and these will be compounded in our interconnected world.

The Islamic Corporation for the Development of the Private Sector (ICD) and OJSC Agroinvestbank of the Republic of Tajikistan have signed a memorandum of understanding for cooperation to consider extension of a line of financing facility to OJSC Agroinvestbank as part of the country program allocation of $25 million for Tajikistan. The line of financing facility will be extended by OJSC Agroinvestbank to the SMEs sector to project’s in industrial, communication, technology, health, construction and agricultural sectors. Khaled Al-Aboodi, CEO and general manager of ICD, said the SME sector is important in all the member countries, including the higher income ones. ICD is now focusing on this sector by extending lines of finance to local banks in addition to the establishment of ASR Leasing Company in Tajikistan.

The World Gold Council is exploring the creation of a Shariah Standard on Gold, which will provide guidance from the Shariah perspective on the usage of gold in financial and investment transactions for Islamic financial institutions and participants. The Standard also aims to increase transparency and harmonisation regarding the use of gold in various market practices. A draft of the Standard has been prepared for the Council by Amanie Advisors, a DIFC-based consultancy and training agency specializing in Islamic finance. The World Gold Council is calling for interested parties active in Islamic financial services to submit their responses to the development of a Shariah Standard on Gold since their participation in the development of the Standard is vital. The deadline for feedback has been extended to 31st January 2016.

Tourism authorities have launched a program to make more halal-certified food products available in Russia. The program aims to attract more tourists from the United Arab Emirates, Saudi Arabia and Kuwait. The halal program will focus on Moscow, St. Petersburg, Kazan, Sochi and the towns of the Golden Ring. According to Schegolkova, these cities already have the infrastructure and hotels that can provide halal-friendly services. The list of cities will be expanded over the next few months. In addition to cuisine from Russia’s Muslim regions and internal republics, the program aims to make halal-certified traditional Russian dishes widely available in the country.

Africa is expected to see a massive population boom, many of whom will grow up Islamic. As such, demand for Islamic products and services on the continent are expected to rise in the coming years. Financing projects through Islamic financial instruments has massive potential within the African region. One such instrument is sukuk. This is beneficial to projects that require long term financing. These opportunities are not only for delivering Sharia-compliant goods and services to the Muslim population. Even in countries with a low proportion of Muslims, the values and principles of Islamic financing—such as investment products that avoid alcohol or gambling, and no-interest lending—appeal to investors seeking ethical schemes or banking customers seeking alternative products.

For centuries, humans from all around the world have tried to use different things as money. Some forms, which most people are familiar with today, have been effective catalysts for trade over thousands of years. Other currencies, from squirrel pelts to parmesan cheese, have had their time or place in human history, but were ultimately unsuccessful or made obsolete. The path to finding the best money has been long and riddled with trial and error. Here are just some of the world’s strangest currencies that we discovered in our research.

Research by Morgan McKinley found a surge in the global value of Islamic banking assets is forecasted for the next few years. Figures are predicted to reach $6.5 trillion by 2020, a huge leap compared to the amount of $150 billion in the mid-1990s. In the UAE alone, the total Islamic banking assets accrued in 2013 was $95 billion (compared to $83 billion in 2012), and it is showing no signs of slowing down, with the Dubai Chamber of Commerce predicting that the annual growth rate will reach 17 per cent until 2018. The increase has been with all consumers, with a recent study from Bloomberg concluding that in the UAE, Islamic finance has also gained popularity amongst non-Muslim expats.

On December 15, 2015, the Prime Ministry of the Republic of Turkey issued a circular on the formation of an Islamic Finance Coordination Committee (Faizsiz Finans Koordinasyon Kurulu) to accelerate the development of Turkey's Islamic finance markets. The Islamic Finance Coordination Committee will be chaired by the minister responsible for the Undersecretariat of Treasury and will include top financial markets regulators from the Ministry of Development, the Ministry of Finance, the Central Bank, the Banking Regulation and Supervision Authority, the Capital Markets Board, Borsa Istanbul, and the Islamic Banks Association of Turkey. The Islamic Finance Coordination Committee will also consult with non-governmental organizations, academics and professional organizations.

The World Bank’s Corporate Secretary Mahmoud Mohieldin expects that gulf oil exporting countries will be affected by the decline in oil prices, welcoming reform measures taken by these countries which include general monetary policies and diversification of income sources. Dr. Mohieldin said that there are golden opportunities in the year of 2016 in light of the declining prices of both mineral products and agricultural goods. The golden opportunity for Arab countries is to take advantage of those declining prices to develop domains of construction and agricultural, alongside other sustainment projects of renewable energy, thus diversifying income sources and endorsing economic reform, growth and stability.

Bangladesh Bank (BB) signed separate agreements with six more private banks on Wednesday to facilitate long-term financing under the World Bank funded Financial Sector Support Project (FSSP). Under the agreements, the six banks - Dutch Bangla Bank Limited, IFIC Bank Limited, South East Bank Limited, Standard Bank Limited, Trust Bank Limited, and Standard Chartered Bank - would provide long-term financing for projects in manufacturing sectors. The central bank earlier signed similar agreement with ten other banks. BB Deputy Governor Nazneen Sultana said that the BB under the auspices of International Development Association (IDA) of the World Bank would provide $300 million through FSSP to meet the growing demand for long-term financing for productive sectors in the country.

The book: "Scaling Up: The Convergence of Social Economy and Sustainability", co-edited by Mike Gismondi, Mary Beckie et al., investigates innovative social economies in British Columbia and Alberta and discovered that achieving a social good through collective, grassroots enterprise resulted in a sustainable way of satisfying human needs that was also, by extension, environmentally responsible. As these case studies illustrate, organizations that are capable of harnessing the power of a social economy generally demonstrate a commitment to three outcomes: greater social justice, financial self-sufficiency, and environmental sustainability.

Saudi Arabia's central bank has granted a license to its national home finance company, Bidaya and it will launch with 900 million riyals ($239.94 million) in capital. The decision by the Saudi Arabian Monetary Agency (SAMA) joins efforts to boost home ownership in the kingdom, where a shortage of affordable housing has become an economic and social issue. In development since 2010, Bidaya is a venture between the finance ministry's Public Investment Fund and the Jeddah-based Islamic Corporation for the Development of the Private Sector (ICD). The company aims to make financing more readily available in a kingdom where home ownership levels lag behind the global average of 70 percent.

The FinMark Trust, a nonprofit that promotes financial inclusion and regional financial integration; the Centre for Financial Regulation & Inclusion (CENFRI), a nonprofit affiliated with FinMark Trust; and The MasterCard Foundation, a Canadian organization founded by the US-based payments firm MasterCard, recently have announced that they will launch a joint data facility named “insight2impact” (i2i). The facility, which is expected to have a budget of USD 9.6 million, is intended to assist financial services providers in assessing the financial needs of low-income populations.

Infrastructure needs in developing countries are great and will continue to rise over the next decade. Since funding infrastructure projects usually requires a long-term and large investment, emerging markets are struggling how to meet these needs through public investments or even traditional bank funding. Figuring out how to finance investments needed in infrastructure is one of the key issues on the G20 agenda and has also been identified in the Sustainable Development Goals. While private-public partnerships are usually mentioned as one way to bridge this financing gap, using Islamic finance or other asset-backed financial mechanisms has started to gain traction in recent years.

In developed markets, crowdfunding is swelling the ranks of early-stage entrepreneurs and bolstering the pipeline of enterprises that diversify economies and create the majority of jobs. However, for early-stage entrepreneurs in emerging markets, the path toward crowdfunding remains untrod. Microlending platforms like Kiva are issuing consumer lending finance but cannot provide enough capital to fund the core business operations of a startup. Larger amounts of debt or equity are available via online platforms, but these are best suited for more mature companies or projects. What is missing is a normative usage of presale, rewards, or contributions crowdfunding for early-stage companies.

Between $3.3 to $4.5 trillion in investments each year will be needed to fund the Sustainable Development Goals, according to UN estimates. As one way to meet these staggering needs, the international development community is developing new results-focused financing instruments, some of which seek to mobilize untapped private sector capital and knowledge, while repositioning global economic and social challenges into investible opportunities. Impact bonds aren’t bonds in the traditional sense. Instead, they should be considered more as equity-like instruments that offer repayment to investors on the basis of results achieved.

A quiet revolution is taking place in the financial industry. According to the United Nations Environment Programme, sustainable development is increasingly being integrated into financial decision-making. The European Union has been rather passive so far in this transformation, but financial regulators in a number of countries are leading the charge. The revolution may be quiet, but it is getting louder. Fossil-fuel companies are increasingly being delegitimized. At the same time, investors are starting to understand that paying attention to climate risk is an integral part of a sound investment strategy that seeks to minimize risk and help to promote financial stability.

The Islamic Development Bank (IDB ) and the New Partnership for Africa's (NEPAD) Development Planning and Coordinating Agency (NPCA) recently signed a memorandum of understanding (MoU) concerning regional integration and cooperation. The MoU also concerned infrastructure, agriculture and food security, education and human capital development, climate change and natural resource management and economic and corporate governance. NEPAD aims to provide technical advisory services coupled with grant and seed funding to assist countries in their development agendas. The challenges to be addressed are access to knowledg, youth employment, sustainable rural development, adequate infrastructure and industrialization.

Islamic Crowdfunding has the potential to help us change our world for the better. There is an immense variety and scope of applications for crowdfunding. Crowdfunding continues to evolve and in recent years made strides into the investment world. Real Estate Crowdfunding is one of the fastest-growing segments of this booming industry worldwide. The Global Crowdfunding industry is still dominated by the US, but Asia has recently seen strong growth eclipsing Europe as the next-largest Crowdfunding region. The low-entry capital makes it especially accessible to the middle income and small-medium business owners.