Muis sets up Singapore community wakaf fund

Wakaf Masyarakat Singapura (WMS) or Singapore Community Wakaf (endowment) will be set up to fund the community’s long-term needs, particularly for religious institutions, asatizah development, and general community needs and initiatives.

WMS is a voluntary funding mechanism to complement other more established community funds such as the Mosque Building and MENDAKI Building Fund (MBMF) and zakat (زكاة). It is not compulsory for all members of the community to contribute to it. Those who have the financial means can opt to bequeath their assets and funds to WMS, in hope of accumulating the community’s reserves for future generations.

Waqf (وَقْف) creation is a familiar construct within the Muslim community in Singapore, where there are currently 91 wakaf with a combined value of more than S$800 million under the care of the Islamic Religious Council of Singapore (Muis).

Each year, Muis will disburse income from Muis-managed waqf to local beneficiaries such as mosques, madrasahs, Muslim charitable organisations, as well as the poor and needy. In the past three years, Muis has disbursed over S$2.5 million to local beneficiaries annually.

According to Muis, it is crucial to consider the long-term potential of waqf assets, and continue to build their value.

The key principles for WMS are: capital preservation*, maintaining a continuous and sustainable source of income, and ensuring ease of community participation and contribution.

Two advisory panels have been set up to put forth recommendations on how to galvanise community support and operationalise the implementation of WMS. Both advisory panels will be chaired by Abu Bakar Mohd Nor, Chairman of InfoFabrica Holdings and the Deputy President of The Singapore Malay Chamber of Commerce and Industry (SMCCI). He is also the Chairman of Small & Medium Enterprise Centre and sits on various boards including Muis.

Abu Bakar called for the community to participate and contribute to Wakaf Masyarakat Singapura. He said: “The act of giving and philanthropy through waqf is an age-old tradition that has historically supported many institutions and associations, including madrasah, mosques and various Muslim organisations. I strongly believe that if all of us take personal ownership on the WMS, through the collective work of the advisory panels and inputs from the community, we can take Singapore’s waqf culture to the next level for the benefit of the community and our future generations.”

The WMS Expert Advisory Panel will comprise professionals and experts in religious, legal, investments, finance, audit and property fields, while the WMS Community Advisory Panel will comprise community members.

The WMS Expert Advisory Panel members will focus on critical aspects of asset creation, valuation and investment, to facilitate the growth of waqf, including possible enhancements to systems, structures and regulations.

The WMS Community Advisory Panel members will focus on the outreach and public engagement efforts to gain crucial ground perspectives and insights. The Panel will recommend a comprehensive strategy to solicit feedback, and communicate the objectives and long-term outcomes of WMS to the Muslim community in Singapore, to encourage voluntary participation from the community. To ensure that the recommendations and plans provided are wholistic and robust, both advisory panels will engage key stakeholders such as asatizah, business communities, professionals, as well as the mosque and madrasah sectors.

The news was announced by the Singapore Minister-in-charge of Muslim Affairs, Masagos Zulkifli on 5 June 2020. The Chairman of the advisory panels will deliver the findings and recommendations to him in December 2020.

*Ensuring the wakaf funds collected retain their value.

New laws regulating awqaf and endowments in Dubai

VP and PM of the UAE and Ruler of Dubai HH Sheikh Mohammed bin Rashid Al Maktoum has issued Law No (14) of 2017 regulating awqaf and endowments in Dubai, UAE. HH also issued Law No. (17) of 2017 on the Mohammed Bin Rashid Global Centre for Endowment Consultancy (MBRGCEC).

HH said that endowment establishments are key partner of governments in community development and play a historic role in development in the Arab world and globally. He also said that the UAE and Dubai aims to provide the best legislations in this domain.

Law No. (14) of 2017 aims to support the UAE vision regarding charity and humanitarian efforts, establishing a comprehensive and modern legal framework that addresses the needs of the community. The Law institutionalises the management, operations and protection of endowments and outlines the framework for providing a conducive environment for charitable activities and community contributions in the fields of education, healthcare, culture, arts, environment, sports and social unity.

The law specifies the responsibilities and obligations of concerned entities, and prescribes the regulations and procedures that govern the management and development of awqaf and endowments. It also defines and regulates the MBRGCEC’s Dubai Endowment Sign which is awarded to government and private entities that contribute substantially to the community.

The law further authorises Dubai’s Awqaf and Minors Affairs Foundation to issue licenses for waqf establishment in collaboration with the MBRGCEC. The two entities outline the regulations that govern the waqf establishments, including licensing, governance regime and penalties for licensing violations. The Awqaf and Minors Affairs Foundation is also responsible for overseeing and monitoring the waqf establishment.

Pursuant to Law No (14) of 2017, endowments are subject to Federal Law No (5) of 1985 without prejudice to the terms and conditions set forth by the grantor or otherwise by the Awqaf and Minors Affairs Foundation and the MBRGCEC. The Board of Dubai’s Awqaf and Minors Affairs Foundation, in collaboration with the MBRGCEC, is authorised to issue the policies and procedures required to implement this law. The law does not contradict or challenge the waqf-related laws applicable in Dubai International Financial Centre.

Pursuant to Law No. (17) of 2017, the MBRGCEC aims to support the vision of Dubai to become a global humanitarian hub, enabling waqf and endowments to match various local, regional and international developmental needs. The law authorises the centre to provide consulting services for individuals and organisations according to international best practices, identify the critical development requirements that waqf can support, enhance knowledge and capabilities in the fields of awqaf and endowments by conducting research and studies, organising conferences and workshops and signing partnership agreements with specialised local, regional and international organisations.

The centre is also authorised to issue the MBRGCEC’s Dubai Endowment Sign according to specified regulations and procedures. To qualify for the signage, the individual or entity must have launched sustainable waqf-related initiatives, projects or contributions.

The law also authorises the Board of Trustees of the Mohammed bin Rashid Al Maktoum Global Initiatives to appoint the Secretary General of the MBRGCEC.

This law annuls any other legislation that contradicts or challenges its articles. Both laws will be published in the Official Gazette and considered valid from the date of publication.

New organisation unifies efforts to build a global ecosystem for endowment investments

+New Awqaf International Organization (AIO) is aligned with HH Sheikh Mohammed bin Rashid Al Maktoum's vision in enhancing Dubai’s position as capital of the Islamic economy

+The initiative enhances the role of endowments as one of the most important social and economic development tools

In line with the directives and support of HH Sheikh Mohammed bin Rashid Al Maktoum, VP and PM of the UAE and Ruler of Dubai, HE Mohammad bin Abdullah Al Gergawi, Minister of Cabinet Affairs and the Future and Chairman of the Executive Council of HH Sheikh Mohammed bin Rashid Al Maktoum, has announced the launch of the Awqaf International Organization (AIO) during the opening ceremony of the third Global Islamic Economy Summit (GIES 2016) held in Dubai, UAE.

Instituted by Awqaf and Minors Affairs Foundation (AMAF) in collaboration with the Dubai Islamic Economy Development Centre (DIEDC) and the Mohammed bin Rashid Global Centre for Endowment Consultancy, the first-of-its-kind initiative globally aims to enhance the role of endowments in the development of societies worldwide.

During his keynote speech at the GIES opening ceremony, Al Gergawi said that endowments is one of the most important social and economic development tools.

Al Gergawi said: “The initiative is a main pillar for the Dubai: Capital of Islamic Economy initiative that aims to develop the awqaf sector and unify the efforts of global awqaf entities and organisations to improve the role of waqf as a key catalyst of economic development.

“The new organisation will unify all local and global efforts to establish a shared system for endowment investments whose laws and regulations are approved by all awqaf organisations worldwide. This step will further enhance the role of the endowment sector and make it a partner in financial transactions and investments in various Islamic economy sectors.”

The press conference was attended by His Excellency Tayeb Al Rais, Secretary General of AMAF, His Excellency Abdullah Mohammed Al Awar, CEO of Dubai Islamic Economy Development Center, and His Excellency Dr. Hamad Al Hammady, Secretary General of Mohammed bin Rashid Global Centre for Endowment Consultancy.

Tayeb Al Rais, Secretary General of AMAF, said the AIO is an umbrella organisation that will empower the work of awqaf organisations by "opening up channels of coordination, collaboration and exchange of best practice."

“This new global is based on our view of the current state of Islamic societies in the region and around the world. Such societies are in urgent need of holistic and sustainable development that is not only in harmony with Islamic values, but also grounded in the realities of modern development," he said.

"We are proud to note that there are several Islamic endowments active around the world. Their tireless efforts have benefited various underprivileged sections of society in terms of imparting education, quality healthcare, vocational training, employment and other socioeconomic support."

Al Rais added that the AIO will facilitate a better use of the potential of endowments, and place authorities in a stronger position to help people at the grassroots level, regardless of their religious or ethnic backgrounds.

The founding members of the AIO include:

Awqaf and Minors Affairs Foundation
Dubai Islamic Economy Development Center
Mohammed bin Rashid Global Centre for Endowment Consultancy
The Department of Awqaf in Sharjah
Awqaf SA (National Awqaf Foundation of South Africa)
Awqaf Canada (National Awqaf Foundation of Canada)
Awqaf New Zealand
Awqaf USA
Awqaf Australia
The Independent Committee of Islamic Finance in Europe
Awqaf Sheikh Mohammed Abdulaziz Al Rajhi

Abdulla Mohammed Al Awar, Chief Executive Officer of DIEDC, said that the launch of AIO reinforces Dubai’s position as an incubator of innovative concepts that advance the Islamic economy. He noted, "With the establishment of the AIO, we expect to achieve a positive impact on the lives of communities across the globe. We also anticipate the AIO to play a pivotal role in strengthening the functioning of endowment institutions through facilitating the financing of SMEs in these countries, and providing the right human resource training to advance their competencies."

Dr Hamad Al Hammadi, Secretary General of Mohammed bin Rashid Global Centre for Endowment Consultancy, said: “The vision of our wise leadership has always focused on addressing the root challenges first, which then yield sustainable outcomes. Unequal social development is one root cause that often leads to a decline in social relations and slows economic growth. We take pride in Dubai’s and the UAE’s constant efforts that seek to enhance the wellbeing of all people.”

Imad Kaddoura, Secretary General of Awqaf Canada, said: “As the Islamic economy framework gains ground and becomes a vital part of the mainstream global economy, it is crucial that we consolidate our efforts to manage and invest awqaf assets, capital, and returns in a shari’ah-compliant manner. The newly established AIO will enable awqaf projects to play a stronger role in our society as sustainable projects beneficial to our stakeholders, as well as the wider global community. We appreciate AMAF’s support and dedication to lead in the launch of this ground-breaking initiative."

Khalid Sukkarieh, Secretary General of Awqaf Australia, said the AIO is a turning point in crystallising the efforts of awqaf international entities. "With this new body we can all work together on a global scale to achieve social development and pursue a mandate that transcends geographical borders. Awqaf has always had a historical place in uniting people of different nationalities and faiths - without discrimination and this is a message we can send globally."

Zeinoul Abedien Cajee, National Coordinator of Awqaf SA, added: “The newly-established Awqaf International can help unify and standardise the work of awqaf entities across the world. In doing so, it will enable awqaf international entities to leverage best practices, and customise initiatives according to geographies to achieve maximum social impact.”

Talib Al Marri, Secretary General of the Sharjah Awqaf General Trust, commented: ““Through this initiative, and in collaboration with other awqaf entities, we hope to enhance all of our efforts. The AIO aims to advance awqaf traditions, strengthen its role in society, and establish awqaf international standards to meet the needs and priorities of the public which can then benefit every segment of society. We commend the efforts of all the founder members and DIEDC in undertaking the responsibility of instituting this unique global organisation and look forward to supporting and adding value to this noble and collaborative endeavour.”

Bader Bin Mohammed Al-Rajhi, Chairman of the National Committee of Endowments, said: “The role of awqaf and waqf investments is part of our religious beliefs, our history and society. Now, as we join together in the new AIO, we will be united in spreading the message of the importance of waqf investments and trust formations on a global level. This will help change the future of Islamic finance and we are proud to be among the founders of this important new group.”

Husain Benyounis, Secretary General of Awqaf New Zealand, said: “The AIO has been launched not merely to coordinate the efforts of member foundations and entities, but to create a global network that shares best practices and can manage international endowments and funds. The body has also been tasked with recommending unified templates for legal frameworks, supporting the organising of awqaf investments, and overseeing applications of sharia standards in accounting, reviewing, and governance.”

Tareq Abou Nour, Secretary General of the Independent European Committee for Islamic Finance Studies, said: “The launch of this global awqaf organisation is the result of the growing interest in the Islamic economy, and its prominent presence in various financial sectors of significance. The AIO reflects a bright future in creating an international platform that convenes all awqaf and like-minded philanthropic foundations. We believe that collaboration is a vital part of change, and awqaf’s new organisation can successfully utilise this approach to enhance its outreach.”

posted from Bloggeroid

Bangladesh receives schools designed as cyclone shelters from IDB

Islamic Development Bank representative Dr Mohammad Hassan Salem has formally handed over 34 schools which also double as cyclone shelters as part of the third phase of the Fael Khair Program in Bangladesh. The programme is funded by a grant from the late King Abdullah Bin Abdul Aziz of KSA.

A total of 95 out of 174 planned school-cum-cyclone shelters have been handed over so far. Each building will serve as a modern educational institution for 240 students and can also provide shelter to 2,000 people and 500 cattle during the country’s frequent cyclones.

The late King Abdullah’s grant of US$130 million for relief and assistance to the victims of cyclone Sidr, which hit in 2007, has been utilised as follows:

• US$110 million to construct 174 School-cum-Cyclone Shelters in the coastal belt of Bangladesh
• US$20 million waqf (Editor's note: a endowment made by a Muslim for a cause) as partial support to maintain the buildings and to provide urgent relief and rehabilitation through agricultural and other inputs to the affected population

The buildings are designed to withstand top wind speeds of up to 260 km/h. The green facilities are equipped with solar power and durable school furniture. They also have potable water systems, including rain water harvesting, to supply safe drinking water.

SESRIC publishes study on reducing poverty with waqf and Islamic microfinance

Source: SESRIC.

Integration of Waqf and Islamic Microfinance for Poverty Reduction: Case Studies of Malaysia, Indonesia and Bangladesh, edited by Professor Savas Alpay, Director General of the Statistical, Economic and Social Research and Training Centre for Islamic Countries (SESRIC), and Mohamed Aslam Haneef, Professor at the International Islamic University of Malaysia (IIUM), presents the outcome of a two-year research collaboration between SESRIC and the Centre for Islamic Economics at IIUM. 

The research project covered three Organisation of Islamic Cooperation (OIC) countries, Malaysia, Indonesia and Bangladesh, and aims to develop an integrated waqf-based Islamic microfinance model to optimise the use of combined resources of waqf and Islamic microfinance institutions in OIC countries. It is anticipated that such an optimisation will ultimately enhance the effectiveness of IMF and waqf institutions in addressing the socioeconomic needs of the society, particularly through effective poverty alleviation programmes.

The report consists of four main sections, starting with a brief overview of poverty in OIC countries, poverty alleviation programmes in Malaysia, Indonesia and Bangladesh and then discussing the potential of waqf as another viable source for financing microfinance institutions in these three countries. 

Section two presents the Integrated Waqf-based Islamic Microfinance (IWIM) model, which comprises six components, waqf, Islamic microfinance, human resources, takaful, project financing and poverty alleviation, plus relevant hypotheses. In order to test the hypotheses of the IWIM model in the three countries, the next section discusses research methodology while the last section focuses on the empirical findings and policy recommendations.

The conceptual IWIM model treats the waqf institution as the “funding agency” and the Islamic microfinance institution as the “implementing agency” that is offering microfinance services together with takaful services and financing human resource development programmes. A fifth component, project financing, to which is be provided by the Islamic microfinance institution, was added to the model. 

According to the report, there is strong indication that the IWIM model can be a viable alternative model for poverty alleviation. The report reaffirms that microfinance is an important institution in the fight against poverty and that Islamic microfinance provides additional value in the context of riba-free financing. Furthermore, the report says that the IWIM model can successfully help microfinance institutions to overcome two major challenges, the provision of financing at lower cost and the facilitation of human resource development programmes.

View the online version here.

Securities Commission Malaysia publishes guide on waqf

Source: Securities
Commission
Malaysia.

With Islamic finance gaining traction across many parts of the world, the development of waqf can play a significant role in attracting greater interest and participation in the Islamic finance industry and entrenching Islamic finance activities.

Waqf Assets: Development, Governance and the Role of Islamic Capital Market is a guide for waqf institutions, religious bodies, practitioners and other interested parties who wish to explore opportunities in developing waqf assets through the Islamic capital market and provides recommendations on governance best practices for waqf institutions that intend to leverage the Islamic capital market for fundraising and investment. 

The book can be purchased for RM80 at the SIDC Bookshop located at the Securities Commission Malaysia headquarters*. For every purchase, RM20 will be donated to initiatives supporting waqf development. 

*3 Persiaran Bukit Kiara, Kuala Lumpur.