IslamicFinance.de

The South African government's recent confirmation that it is in the process of introducing tax neutrality laws for Mudaraba (trust financing), Murabaha (cost-plus financing) and Diminishing Musharaka (diminishing shared ownership) contracts is a long overdue recognition of the potential Islamic finance has for the country and the region. Financial services industry sources stress that the proposed tax neutrality measures are just the start and the wider objective is to introduce a comprehensive regulatory and legal framework to facilitate Islamic finance in the country both for financial inclusion and market liberalization and development reasons.
It may also have something to do with the ambition of the country to develop Cape Town into an international financial hub, an ambition which was confirmed by Alan Winde, the finance minister of the provincial government of the Western Cape; and South Africa's aim of attracting inward foreign direct investment (FDI) from the Middle Eastern countries and others such as Malaysia and Brunei.