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ÂMakkah Imam Calls for Islamic Common MarketÂ
15 March 2008 — Sheikh Saud Al-Shuraim, imam of the Grand Mosque in Makkah and a member of the teaching staff at Umm Al-Qura University, has called for the establishment of an Islamic common market.Â
Delivering his Juma sermon at the Grand Mosque yesterday, the imam said the proposed market should follow the teachings of the Shariah, keeping away from interest-based financial dealings.
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Many international financial organizations have started adopting Islamic financing systems after the latter proved successful in terms of achieving substantial profits, Al-Shuraim said, adding that the Qur’an and Sunnah have explained the basic principles for financial transactions.Â
Ezzuddin Khoja, secretary-general of the Supreme Council of the Islamic Financial Banks, said Islamic banks in Arab and Muslim countries alone now handle more than $250 billion.Â
Islamic bank deposits in the Gulf rose by 29 percent to $58 billion in 2005 compared to the previous year. Islamic finances worldwide are estimated at about $450 billion, he explained.Â
Islamic and traditional banks apply different rules.Â
The Islamic banking system does not depend on loans and offers a variety of products such as murabaha, mudaraba, musharaka, ijara and istisna based on profit and loss sharing.Â
The Islamic banking system began in Saudi Arabia and Prince Muhammad Al-Faisal and Saleh Al-Kamil have played a pioneering role in promoting it, Khoja said.
The story above is interesting only if they understand that usury is much more than charging interest. As Umar Ibrahim Vadillo said, in my paraphrase, it is not important that Muslims have an ‘Islamic Market’ using usurious instruments, but what would be interesting is Muslims and non-Muslims having a market using non-usurious instruments.
But some kind of market of ethnic Muslims using the instruments of the ‘Islamic banking’ movement will get us nowhere. What they outline above is usury with a turban and a long beard on it, unfortunately.
What is needed from the Muslim governments is the protection of existing Islamic markets and the creation of new ones according to the Sunnah of there being no charge on them and no tax levied on their trade per se. If the only reason they did this was to avoid the coming storm of popular discontent because of the rising prices of basic commodities, that would be sensible. We have already had the first signs of that storm in the rioting in Egypt.
They should also monetise gold and silver, i.e. issue gold and silver coins, as well as flous for smaller denominations for use in their societies. It would make a great deal of sense to do this now, before the very major shock waves that are certain to come soon in the debacle of the burgeoning hedge fund and derivatives markets, a collapse that will make the sub-prime mortgage credit crunch, of which we have not seen the end yet, seem comparatively trivial. Currencies and commodities are going for a ride that is certainly to be rocky, whereas gold and silver have suffered hardly any real inflation in thousands of years.