French Study on Islamic Finance

French study on Islamic finance ready next month
Available at: http://www.gulfbase.com/site/interface/NewsArchiveDetails.aspx?n=123193

The French Institute for Islamic Finance (FIIF) announced here Monday that the team responsible for Islamic Finance affairs in France will submit a study on Islamic contracts next February. Head of FIIF Mohammad Nouri told KUNA that the team, formed by the advisor of Minister of Economic Affairs, Industry, and Employment Christine Lagarde, will submit their study on Murabaha (a kind of sale which is compliant with Islamic Sharia), Sokuk (Islamic bounds), and Ijara (Lease-to-Own).

The study also covers Istisna’ (an agreement to sell to or buy a non-existent asset to be made or built based on specifications outlined by ultimate buyers at an agreed predetermined selling price and to be delivered on a specific future date).

The team, which consists of Banque de France (bank of France), counseling offices, legal offices, and FIIF, meets every two weeks to study laws and legislation on Islamic financing, he pointed out. He stressed that Islamic finance attracts people around the world, especially following the world economic crisis, the decrease of liquidity, and the increase of international deficit, adding that France suffers a deficit of about 100 billion euros.

French officials realized that the cause of the crisis was the big connection with virtual economy rather than “real” products, he said. In addition, economic banking proved it was special and efficient, technically and profit-wise, and was based on simple principles understood by the public, he noted.

Nouri said the French government became aware of that last factor, especially after it noticed the big steps by the United Kingdom to attract substantial capital from the Islamic world. France is paving way for Paris to become a major western and European center that attracts Islamic banks, he emphasized.

The start of this effort was with an expression of a political desire with the announcement of the president, finance minister, and central bank governor, he said. This was followed by media, political, legal, and legislative action, including research, seminars, lectures, and other academic input, he said.

Saying he was opposed to changing the unique characteristics of Islamic finance, he noted the issue was one of credibility. He stressed that Islamic finance was an international system that many countries benefited from by now, including Japan, the United States, China, and Russia, noting that France will issue Sokouk this year.

In 2009, real estate Murabaha operations of three billion euros were made, he said, adding that France aims to reach 100 billion euros in this category. Nouri pointed out FIIF was established in 2008 to sponsor Islamic finance in France. It includes a group of Muslim scholars, economists, bankers, and legal figures who have knowledge about French laws. The institute also interacts and cooperates with scholars from different Islamic countries who have expertise in Islamic finance.

“If my theory of relativity is proven successful, Germany will claim me as a German and France will declare that I am a citizen of the world. Should my theory prove untrue, France will say that I am a German and Germany will declare that I am a Jew.” Albert Einstein

Best Regards
ZULKIFLI HASAN

  • Dubai International Financial Centre

    3 thoughts on “French Study on Islamic Finance

    1. Apa kabar Zul? Ke mana berjalan awal tahun ni?

      • ZULKIFLI HASAN says:

        Salam Along,

        I just finalised my chapter 6 and now ready to continue my journey for knowledge. Ha ha. This week to Glasgow and next week to Andalusia for a week. How’s everything? Live performance before Najeeb Razzaq tuuu. Proud of you bro. Send my regard to Azli.

    2. mohamad halim othman says:

      Salam Brothers,

      It’s heartening to hear that Islamic finance will gain a foothold in Europe.

      Not withstanding that the main idea behind the issuance of soukok and bounds ( french version of bonds ? ) by France and others is none other than to attract Arab petro-dollars investments to help their economies, Muslim bankers and investors must take this opportunity to show case the correct and practical character of Islamic economics, finance and banking.

      issues on Profit sharing vs BBA and the preponderance of one school of thought over the others should not take centre stage and eclipse efforts to introduce Islamic finance in the land of the Franks.
      To do so will tantamount to throwing away a golden opportunity that may never come again.

      I

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