President Widodo of Indonesia becomes Honorary Fellow of the World Islamic Economic Forum

The Honorable President Joko Widodo of Indonesia has accepted the invitation of the Honorable Tun Musa Hitam, Chairman of the World Islamic Economic Forum (WIEF) to be an Honorary Fellow of the WIEF. The only other Honorary Fellow of the WIEF is the President of the Islamic Development Bank, the Honorable Dr Ahmad Mohamed Ali Al Madani.

President Jokowi was also invited to deliver a Special Address at the 11th WIEF, to be held at the Kuala Lumpur Convention Centre on 3 to 5 November this year.  With the theme Building Resilience for Equitable Growth, the 11th WIEF will give special emphasis to SMEs with over 3,000 government leaders, captains of industries, entrepreneurs, academia and digital experts expected to meet and explore business opportunities that transcend international borders, religion and culture. The WIEF has previously held forums in Malaysia, Pakistan, Kuwait, Indonesia, Kazakhstan, UK and UAE, and aims to bring together Muslim and non-Muslim communities through the common language of business.

Source: WIEF. The Honorable Tun Musa Hitam, Chairman of the World Islamic Economic Forum (third from left), WIEF International Advisory Panel Member and Founder & Chairman of the Executive Centre for Global Leadership, Indonesia, Tanri Abeng  (second from left) and the WIEF Secretary-General Tan Sri Ahmad Fuzi Abdul Razak (left) with the Honorable President Joko Widodo of Indonesia (right).

During the meeting President Jokowi wished Tun Musa Hitam and the WIEF Secretariat well in its preparations for the 2015 Forum in Kuala Lumpur.

Tun Musa Hitam said, "I look forward to President Jokovi's personal contribution, as an Honorary Fellow, to further elevating the growing stature of the WIEF in promoting greater cohesion, collaboration and integration through business between the Muslim world and the non-Muslim nations and communities around the globe. Being the largest Muslim country in the world, Indonesia is certainly well placed to be an important prime mover in various fields that would bring huge benefits for the economic well being of the ummah*."

The WIEF Foundation, a not-for-profit organisation based in Kuala Lumpur, organises the annual World Islamic Economic Forum, a business platform showcasing business opportunities in the Muslim world, and runs programmes of the various initiatives of the Foundation that strengthen people partnership and knowledge exchange between Muslim and non-Muslim communities across the globe.

*Muslim community

Submissions open for WIEF Young Fellows leadership programme

The World Islamic Economic Forum (WIEF) Foundation, a not-for-profit organisation based in Kuala Lumpur, is calling for submissions for WIEF Young Fellows, one of WIEF's flagship programmes focusing on youth leadership. 

The one-week intensive leadership programme bringing together young leaders across the globe from all walks of life, covering personal and community leadership, entrepreneurship and business management, environmental sustainability, social enterprise and philanthropy. 

Themed Learn, Empower, Earn, Return, WIEF Young Fellows 2015 will take place in Cordoba, Spain from 16 to 22 March 2015.

Successful applicants stand a chance to win:

• A slot to present their project/business pitch at Idea Pad at the 11th World Islamic Economic Forum, Kuala Lumpur
• 8 to 12 months mentorship on their project/business plan
• Real-time business and cultural immersion in the agriculture sector in south of Spain 

Click here to apply.  Applications close on 23 January, 2015.

Malaysia could be halal bioeconomy hub

Bio-based industry developer Malaysian Biotechnology Corporation (BiotechCorp) is confident that Malaysia has the potential to be a global hub for the halal bioeconomy and receive related investments from Islamic countries. 

Source: Malaysian Biotechnology Corporation.

“Malaysia believes that the halal industry has high potential as a new source of economic growth and to address the global challenges on food security, healthcare and sustainability issues. With the industry evolving into bio-based economy, the potential of the halal bioeconomy is tremendous,” said Dato’ Dr Mohd Nazlee Kamal, CEO of BiotechCorp.

Speaking at the 2014 World Islamic Economic Forum (WIEF) in Dubai, Dato’ Dr Mohd Nazlee added that as the lead agency developing the bio-based industry in Malaysia, BiotechCorp intends to collaborate with relevant halal authorities in its efforts to develop bioeconomy-based halal products and innovations such as halal vaccines and halal agro-food businesses.

Malaysia is well positioned to be the centre for the promotion, distribution and production of halal food, non-food products and other services. Companies can also leverage on Malaysia’s strength in halal certification and the government’s support as well as promotional efforts to capture the halal market.

“Bioeconomy will act as an enabler to ensure sustainability of the Halal industry to reach the demands by the global Muslim population for food, healthcare and other services. With the Halal Bioeconomy initiative, we would be able to create a halal ecosystem as a platform for the halal industry players in venturing into lucrative market for halal bio-based products worldwide,” Dato’ Dr Mohd Nazlee added.

The 10th WIEF organised by the WIEF Foundation in collaboration with the Dubai Chamber brought more than 2,500 participants from 140 countries and offered a global platform to form innovative partnerships in the areas of Islamic finance, the halal food industry, halal tourism, the Islamic digital economy, Islamic art and design, centres for Islamic economy standards and certification, and international centres for Islamic information and education.

Double-digit growth expected for Islamic finance world

Tenth World Islamic Economic Forum (WIEF) Knowledge Partner PricewaterhouseCoopers (PwC) has shared an outline of the global Islamic finance environment in conjunction with the 10th WIEF, to be held in Dubai in October this year. 

On the global front, Islamic finance is expected to register double-digit growth this year and cross the US$2.7 trillion mark by 2017. According to PwC,  Islamic finance has grown both in size and geographic coverage around the world. The industry continues to see the establishment of Islamic financial institutions in new jurisdictions. There has been product innovation across all Islamic finance asset classes as the industry diversifies beyond its traditional banking products and services. Islamic banking continues to be the main driver for Islamic finance and is likely to account for more than 75% of global Islamic finance assets while sukuk currently account for nearly 15% of the market, PwC said.

Asia and Africa are expected to contribute significantly towards the growth in Islamic finance with approximately 95% of the global Muslim population located in these regions. Southeast Asia and the Middle East remain centres of Islamic finance activity. The Gulf Cooperation Council (GCC) accounts for approximately one-third of global Islamic finance and assets have grown over five years at more than 20% CAGR, says PwC. 

Globally, institutions and governments are increasingly resorting to Islamic financing in order to meet their funding requirements. Governments of the UK, South Africa and the Philippines have announced sovereign sukuk issues, led by the UK which announced its maiden sovereign sukuk issue at WIEF 9 in London last year and completed the issue earlier this year to an enthusiastic response. 

As a result, development and implementation of laws and regulations for the issuance of sukuk has been introduced by a number of countries. Dubai recently issued a decree to set up the Dubai Islamic Economy Development Centre as part of a wider plan to become a global hub for Islamic finance which, in the UAE, is expected to grow at a five-year CAGR of 17% from 2013 to 2018 from a base of approximately US$95 billion in 2013. Over US$16 billion of sukuk are expected to be issued by 2014 and Dubai has already emerged as a centre for this asset class.

More than 2,500 participants from 140 countries expected at the WIEF this year. The event includes a panel on Islamic finance, with Toby O'Connor, Chief Executive Officer, The Islamic Bank of Asia, Dr Adnan Chilwan, Chief Executive Officer, Dubai Islamic Bank, Tirad Mahmoud, Chief Executive Officer, Abu Dhabi Islamic Bank, and Muzaffar Hisham, CEO, Maybank Islamic, Malaysia as panelists and Samad Sirohey, CEO, Citi Islamic, UAE as the moderator. 

Organisers flesh out details of the 10th WIEF in Dubai this October

The World Islamic Economic Forum (WIEF) Foundation and the Dubai Chamber of Commerce & Industry (Dubai Chamber) have unveiled details of the upcoming 10th WIEF which will be held in Dubai on October 28 to 30, 2014 at the Madinat Jumeirah Conference Centre. The annual forum is to be hosted in Dubai for the first time following events held in various cities, including Kuala Lumpur, Islamabad, Kuwait, Jakarta, Astana (Kazakhstan), Johor Bahru and London.

Source: WIEF Foundation. Launching the event. From left, Hassan Al Hashemi, Vice President – International Relations of the Dubai Chamber of Commerce and Industry, His Excellency Abdul Rahman Saif Al Ghurair, Chairman of the Dubai Chamber of Commerce & Industry, the Honourable Tun Musa Hitam, Chairman of the WIEF Foundation, Kunrat Wirasubrata, Director of Islamic Development Bank Group, Regional Officer for Southeast Asia, and Tan Sri Ahmad Fuzi Abdul Razak, Secretary General of the WIEF Foundation.

Themed Innovative Partnerships for Economic Growth, the Forum aims to forge greater collaboration between nations, bringing a new era of prosperity for the global economy. Recognised for its significant contributions to progress in the global Islamic economy over the last 10 years, the annual forum will highlight Dubai’s pursuit to play a key role in shaping the US$8 trillion Islamic economy, and introduce new features to celebrate Dubai as the land of creativity and city which embraces the culture of innovation. The new features include:

· Ideapad: Technology & Innovation Showcase – a platform for entrepreneurs and innovators to give a 15-minute pitch on stage to capture the attention, interest, and potentially, investment, of the forum’s international audience

· Business Exchange – a business match-making programme where selected companies give a three-minute pitch about their business, followed by a networking session with delegates

There will also be a specialised session on the second day of the Forum to inaugurate and drive the Halal bio-economy agenda focusing on food security, healthcare and well-being of the global Muslim community. Mobilising Capital from Waqf, Pension Funds and Unit Trusts: Developing Best Practices is another panel discussion which will be introduced at the 10th WIEF.

These new features will complement the current programme which includes panel discussions, Masterclass sessions, networking events and the Marketplace of Creative Arts Festival (MOCAFest).

Key topics at the 10th WIEF include:

· Global Economic Outlook: Developing a Resilient Model for Developing Economies
· Global Financial Landscape
· Islamic Finance’s Pivotal Role in Enabling Trade & Streamlining the Halal Supply Chain
· Socialising Education and the Role of Universities
· Retaining Young Talents
· Sustainable Urban Planning – Creating Smart Infrastructure and Holistic Communities
· Rise of Women Entrepreneurs – Developing a Peer Network

Source WIEF Foundation. Panelists from left: His Excellency Abdul Rahman Saif Al Ghurair, Chairman of the Dubai Chamber of Commerce & Industry, the Honourable Tun Musa Hitam, Chairman of the WIEF Foundation, and Kunrat Wirasubrata, Director of Islamic Development Bank Group, Regional Officer for Southeast Asia.

The Honourable Tun Musa Hitam, Chairman of the WIEF Foundation said, “The Islamic economy is not insulated from happenings around the world and our focus, at the World Islamic Economic Forum Foundation, is bringing to the fore opportunities which will ensure continued progress for the economy and the people. Three ways we can achieve this are by exploring prospects in smaller, non-majority Muslim markets, leveraging the continued growth of Islamic finance and, represented in our theme for 10th WIEF, forging innovative partnerships for business success.

“The upcoming 2015 Asean integration, as well as the increasing purchasing power of Muslim consumers, underscores the strong growth potential of the Islamic economy. Our priority for the 10th WIEF is bringing global leaders, businesses and all members of the community together to realise these opportunities for sustainable development worldwide. We all have a part to play.”

His Excellency Abdul Rahman Saif Al Ghurair, Chairman of the Dubai Chamber of Commerce & Industry stated, “The Arab world offers one of the most comprehensive and attractive Islamic capital market systems in the world, and Dubai, already the region’s key business hub, is the gateway for businesses to unlock the potential of the Islamic economy across the Gulf and wider Middle East.

“The close collaboration between the WIEF Foundation, Dubai Chamber of Commerce & Industry, and Dubai Capital of Islamic Economy in preparation for this forum is testament to the success formula of innovative partners for economic growth, and we are confident that more such partnerships will be forged when global leaders and businesses converge in Dubai for the 10th WIEF.”

Highlighting that economic growth will provide an opportunity to help the less fortunate, Kunrat Wirasubrata, Director of Islamic Development Bank Group, Regional Officer for Southeast Asia commented, “Governments, businesses and individuals are becoming increasingly cognisant that they can and should play a role in eradicating global social issues, such as poverty and famine. By re-introducing social instruments such as waqf*, the Islamic community is well-placed to lead the change in narrowing the gap between the rich and poor. We have seen increasing interest among wealthy families who seek to give back to the community through the use of Islamic waqf.”

The 10th WIEF which is expected to be attended by more than 2,500 participants from 140 countries, and will offer a global platform to form innovative partnerships based on the seven pillars of the Dubai Capital of Islamic Economy initiative launched in 2013: Islamic finance, halal food industry, halal tourism, Islamic digital economy, capital of Islamic art and design, centre for Islamic economy standards and certification, and international centre for Islamic information and education.

*Waqf (وقف) is a donation of assets to be used for the benefit of a community and can be used to build schools, hospitals or shelters. Waqf asset managers are not owners but trustees and must abide by all conditions set by the waqf in the first instance. The practice of waqf is not limited to Muslims, and non-Muslims can be both benefactors and beneficiaries of waqf.

Finance industry shifting towards Islamic finance

As part of the preparation for the 10th World Islamic Economic Forum (WIEF), the Dubai Chamber of Commerce and Industry has issued a report based on a study by EY noting that global Islamic banking assets have seen a cumulative annual growth rate of about 16% from 2008 to 2012, reflecting the radical shift from conventional financial system in favour of Islamic finance. 

The 10th WIEF will be organised in Dubai by the Dubai Chamber and the WIEF Foundation from 28 to 30 October 2014.

Islamic banking products and services have consistently gained market share in recent times, growing up to 50% faster than the traditional banking sector in some markets. The UAE is emerging as a serious player in this sector with total Islamic banking assets worth about US$95 billion in 2013 compared to US$83 billion in 2012. This momentum is unlikely to lose steam as the Dubai Chamber report shows that the compound annual growth rate (CAGR) for Islamic banking assets in the UAE is expected to be about 17 per cent over the period 2013-2018.

“The report by Dubai Chamber shows that the prospects of Islamic banking are very promising as indicated by the significantly high growth rates of Islamic banking total assets,” said H.E. Hamad Buamim, President and CEO of Dubai Chamber. “The research note supports Dubai’s recognition of Islamic finance as a key pillar in the strategy to position itself as the centre for Islamic banking and finance as part of the Dubai Capital of Islamic Economy initiative.”

"Dubai has the potential to shape the course of the massive Islamic economy, and this is reflected in the choice of Dubai as the venue for the 10th World Islamic Economic Forum (WIEF). The Forum comes as a unique opportunity for Dubai to give a new direction to the Islamic finance industry, and help consolidate efforts, share knowledge and experiences to leverage the emerging opportunities in the changing dynamics of the global economy,” H.E. Buamim added.

The report estimates that there are 38 million Islamic banking customers around the world with two thirds of them in Qatar, Indonesia, Saudi Arabia, Malaysia, UAE and Turkey (also known as the QISMUT region). Among these six prominent Islamic finance countries, Saudi Arabia is the biggest market in terms of Islamic banking assets with estimated value of about US$285 billion in 2013 compared to US$245 billion in 2012. 

The research note also shows that Saudi Arabia represents about 43% of the total Islamic banking assets in all the six countries. It also accounts for about 53% of Saudi Arabia’s total domestic banking assets.

According to the World Islamic Banking Competitiveness Report 2013–14, while one-fifth of the banking system assets across QISMUT have transitioned to Islamic banking, in Saudi Arabia, supply push has seen share of Islamic banking cross 50% of system assets.

In 2012, QISMUT was one of the fastest growing markets for Islamic banking, with total Islamic banking assets worth about US$567 billion and registering a CAGR of 16.4% over the period from 2008 to 2012.

The Dubai Chamber research also shows that the global Islamic banking profit pool is projected to reach US$30.5 billion by 2018, driven mainly by a higher retail focus. In 2012, the QISMUT Islamic banking profit pool was estimated at US$9.4 billion and it is expected to reach US$26.4 billion by 2018.

Commenting on the findings, Ashruff Jamal, PwC Global Islamic Finance Leader, said: “Dubai is powering ahead with the creation of its recently announced ‘Capital of the Islamic Economy’ initiative. A number of the building blocks of this initiative, spanning seven key pillars, are already in place as the emirate eyes the US$8 trillion global Islamic economy which accounts for approximately 11% of Global Gross Domestic Product. This will inevitably position Dubai as the global destination of choice for Islamic products, finance and services, encourage public-private partnership in this rapidly growing sector as well as attract local and foreign investments as the emirate ramps up for Expo 2020.”

Jamal added: “A fundamental part of the global Islamic economy is the Islamic finance sector, which is witnessing rapid growth as Islamic financial institutions look to deploy their liquidity into regional and international expansion such as the acquisition of Barclays’ retail portfolio by Abu Dhabi Islamic Bank, and Dubai Islamic Bank’s acquisition of a 25% stake in Indonesian Islamic lender Bank Panin Syariah. Another ‘first’ is the recent announcement of an Islamic Exim (export-import) bank which will be the only institution of its kind in the world with three unique features; it will be Shari'ah compliant, trade based and run largely by the private sector.”

Highlighting Dubai’s status as a leading financial centre for the issue of sukuk, Jamal said: “Dubai’s Islamic capital market is witnessing rapid expansion with more than US$16 billion of sukuk expected to be in issue by the end of this year with Dubai’s sovereign sukuk being ranked as one of the world’s best performing instruments.”

The Dubai Chamber report, however, points out that many Islamic retail banks suffer from lower profitability than the conventional banks, mainly due to higher expenses attributed to complex products, lengthy process steps and more interfaces. It is estimated that on average leading Islamic banks posted 19% lower return on equity (ROE) than comparable conventional peers. The average ROE for the top 20 leading Islamic banks is about 12.6%, compared to an average of 15% at comparable conventional banks, it states.

The Dubai Chamber research note supports recent indications that Islamic finance is extending reach, particularly in the Middle East and North Africa (MENA) region. According to Kuwait Finance House 2013 estimates, the MENA, excluding the Gulf Cooperation Council (GCC) states, remains the focal market for Islamic finance, with US$599.4 billion in total assets, followed by GCC with US$536.9 billion assets. Islamic finance is also gaining ground in North America and Europe with banking assets worth US$59.8 billion and total assets reaching US$71.6 billion in 2013, reflecting the industry success in transcending barriers to gain greater market share in new areas.

Dubai to host the World Islamic Economic Forum this October

The Dubai Chamber and the World Islamic Economic Forum (WIEF) Foundation have announced that the 10th World Islamic Economic Forum will be organised in Dubai for the first time, in line with the emirate’s aims to play a key role in shaping the US$8 trillion Islamic economy.

The event, with the theme Innovative Partnerships for Economic Growth and to be held at the Madinat Jumeirah Conference Centre from October 28 to 30, 2014, will offer a global platform for partnerships based on the seven pillars of the Dubai Capital of Islamic Economy initiative. Launched in 2013, the pillars are: Islamic finance, the halal food industry, halal tourism, the Islamic digital economy, becoming a capital of Islamic art and design, a centre for Islamic economy standards and certification, and an international centre for Islamic information and education.

“The global Islamic economy caters to a 1.6 billion population growing at twice the rate of the global population, which highlights its strong position. Dubai Chamber is keen to support this growth with recommendations and innovative solutions at the 10th World Islamic Economic Forum that will open new horizons for comprehensive economic development in line with our efforts to establish Dubai as the world capital of Islamic economy,” His Excellency Abdul Rahman Saif Al Ghurair, Chairman of Dubai Chamber, said.

The Honourable Tun Musa Hitam, Chairman of the WIEF Foundation, said: “The WIEF is happy to celebrate its 10th anniversary in Dubai, one of the fastest growing cities. Islamic economies present great opportunities for growth in view of their enormous size and massive purchasing power. As the land of creativity and a city that has embraced the culture of innovation, Dubai will help drive innovative partnerships to create Islamic economy solutions that cater to the needs of the era.”

The 10th World Islamic Economic Forum is being organised by the WIEF Foundation in collaboration with Dubai Chamber, as part of its efforts to support the vision of the emirate to become the global capital of Islamic economy. The Forum is expected to see more than 2,500 delegates from 140 countries.