The Global Perspective of Islamic Finance and the Potential for China to Tap into the Islamic Finance Market

2021 ◽  
Vol 11 (01) ◽  
pp. 14-28
Author(s):  
Fares Djafri ◽  
Mohamad Akram Laldin ◽  
Abdelkader Laallam
Keyword(s):  
Success Factors ◽  
Public Awareness ◽  
Legal Framework ◽  
Global Perspective ◽  
Inductive Method ◽  
Islamic Finance ◽  
Belt And Road Initiative ◽  
Financial Industry ◽  
Belt And Road ◽  
The Government

Purpose: Islamic finance is considered one of the fastest-growing segments of the global financial industry. Over the last four decades, Islamic finance has expanded globally to western and other non-Muslim countries. This paper aims to explore the potential for China to tap into the Islamic finance market and the challenges that may face the implementation of Islamic finance there. Methodology: This study adopts a qualitative method of inquiry and utilizes the inductive method and content analysis to build comprehensive knowledge that would assist in exploring the significance and potential benefits that China may gain from the adoption of Islamic finance. Findings: The study reveals that China has a huge opportunity to capitalize on Islamic finance for economic development, particularly in the implementation of China’s Belt and Road Initiative (BRI). The paper also highlights the critical success factors for introducing Islamic finance in China, most importantly, political will. Genuine support from the government is needed for the effective introduction of Islamic finance in the country. This support should be subsequently followed by the development of the legal framework, an amendment of the laws, broad publicity to raise public awareness, and effective collaboration with international organizations. Significance: To the best of the authors’ knowledge, this study is among the few which highlights the potential for China to tap into the Islamic finance market. It is expected to contribute to enhancing the implementation and development of the Belt and Road Initiative (BRI).

The experience and the prospects of Islamic finance in Kazakhstan

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Nasim S. Shirazi ◽  
Laura A. Kuanova ◽  
Adilbek Ryskulov ◽  
Aziya G. Mukusheva
Keyword(s):  
Institutional Environment ◽  
Public Awareness ◽  
Local Population ◽  
Legal Framework ◽  
Islamic Finance ◽  
Financial Industry ◽  
Content Type ◽  
Qualitative And Quantitative ◽  
Bank Deposits ◽  
Further Development

Purpose This paper aims to take stock of the Islamic finance experience and aims to identify an approach for further development in Kazakhstan, using qualitative and quantitative assessments. Design/methodology/approach The paper presents a conceptual framework based on literature review and content analysis. Furthermore, the study uses a survey-based methodology to collect data and determine the prospects, challenges and possible remedies. The quantitative parameters of the potential of Islamic finance in Kazakhstan are based on the assessment of funds on bank deposits, which can be considered potential resources for Islamic financial instruments. Findings The results suggest improving the legal framework and institutional environment to grow Islamic finance in the country. Raising trust levels in a Shariah-based system within the local population, reducing transaction costs and reducing information asymmetry allow raising public awareness of Islamic finance and integrating Islamic finance into the conventional financial system. Research limitations/implications This paper is not free from limitations and does not focus on implementing the suggested results. Social implications This work elaborates in what way the Islamic finance advancement affects the development of economics and focuses on co-financing of real asset-based projects, with the risk and loss sharing; charity; strict prohibitions on the financing of haram activities, pseudo-needs; and subordination of the individual’s interests to society. Originality/value The proposed study presents originalities and it identifies the significant challenges and barriers for further Islamic financial industry development in Kazakhstan by professionals survey. Furthermore, the study assesses potential Islamic finance assets and provides recommendations for successful Islamic finance advancement, considering the peculiarities of the national economy.

scholarly journals Belarus-China: Avoiding the “Debt Trap”

2021 ◽  
Author(s):  
Kiryl Rudy
Keyword(s):  
Economic Growth ◽  
Foreign Debt ◽  
Soviet Economy ◽  
The Other ◽  
Industrial Park ◽  
Belt And Road Initiative ◽  
Other Hand ◽  
Industrial Projects ◽  
Belt And Road ◽  
The Government

Since 2005 Belarus with its developing Post-Soviet economy has been attracting loans from China. By 2019 China became among top three international lenders for Belarus. On one hand Chinese loans financed infrastructure and industrial projects and supported economic growth in Belarus, and on the other hand they increased import from China and foreign debt of Belarus. In order to overcome the phobia of Chinese “debt trap” the Government of Belarus recently decreased the number and amount of Chinese loans tied to infrastructure projects, improved credit terms, increased FDI from China, and created joint industrial park ‘Great Stone’. As a result, the case of Belarus and China outlines how to avoid “debt trap” in ‘Belt and Road’ initiative by focusing on FDI from China.

scholarly journals Islamic Finance in The Digital World: Opportunities and Challenges (Kewangan Islam dalam Dunia Digital: Peluang dan Cabaran)

2019 ◽  
Vol 16 (3) ◽  
pp. 283-299
Author(s):  
Mohamad Akram Laldin ◽  
Fares Djafri
Keyword(s):  
Secondary Data ◽  
Inductive Method ◽  
Islamic Finance ◽  
Financial Industry ◽  
Finance Industry ◽  
Left Behind ◽  
Digital World ◽  
Innovation And Technology ◽  
Shariah Governance ◽  
The Relationship

Islamic finance has grown considerably over the last four decades and has a global reach. It is considered one of the fastest-growing segments of the global financial industry. One of the biggest challenges for Islamic finance in the next decade is on financial technology (Known as Fintech). In the digital world, traditional financial practice will be left behind. This paper examines the phenomenon of financial innovation and technology in Islamic finance. The research adopts a qualitative approach employing the inductive method to trace primary and secondary data on the topic and the descriptive method to describe the emergence of fintech in the Islamic finance industry. The study found that all financial innovations are generally welcomed and can be considered as benefits (Maslahah) to the customers and to the whole financial industry. Innovations in fintech become impermissible only if there is clear evidence from the Shariah that they are against the basic rules of the Shariah. The study also highlights the relationship between fintech and Shariah compliance and suggested to have a proper Shariah governance framework in order to ensure the operation of fintech is in total compliance with Shariah. Besides that, authorities and regulators are required to develop Shariah standards that would explicitly spell out the requirement of Shariah that are fundamental to fintech operations and practices. Keywords: Innovation, Fintech, Digital World, Shariah Compliance, Islamic Finance. Abstrak Kewangan Islam telah berkembang dengan pesat sejak empat dekad yang lalu dan telah menjangkau capaian global. Ia merupakan salah satu segmen dalam industri kewangan global yang paling pantas berkembang. Salah satu cabaran terbesar bagi kewangan Islam sepuluh tahun akan datang adalah teknologi kewangan (dikenali sebagai Fintech). Pada era digital, amalan kewangan yang tradisional tidak akan lagi diguna pakai. Kajian ini menyelidik fenomena yang tercetus daripada inovasi kewangan dan teknologi dalam kewangan Islam serta parameter Syariah yang berkaitan. Pendekatan yang digunakan dalam penyelidikan ini bersifat kualitatif dengan mengaplikasi dua kaedah. Kaedah yang pertama ialah kaedah induktif yang digunakan untuk mengesan data primer dan sekunder yang berkaitan dengan topik dan kaedah kedua ialah kaedah deskriptif bagi menggambarkan kehadiran Fintech dalam industri kewangan Islam. Hasil kajian mendapati bahawa inovasi kewangan pada umumnya adalah digalakkan dan merupakan suatu maslahat kepada para pelanggan dan kepada keseluruhan industri kewangan. Hukum inovasi atau penciptaan sesuatu yang baru dalam Fintech akan berubah menjadi haram hanya apabila terdapat bukti jelas daripada Syariah yang menunjukkan ianya bertentangan dengan peraturan asas Shariah. Kajian ini juga mempamerkan hubungan antara Fintech dan pematuhan Syariah dan mencadangkan agar sebuah rangka kerja tadbir urus Syariah dibentuk bagi memastikan operasi Fintech adalah sepenuhnya mematuhi Syariah. Di samping itu, pihak berkuasa dan pentadbir disarankan agar mewujudkan satu piawaian Syariah yang menggariskan syarat-syarat penting dalam aspek pengoperasian dan amalan Fintech. Kata kunci: Inovasi, Fintech, Dunia Digital, Pematuhan Syariah, Kewangan Islam.

scholarly journals Tendencies and Prospects of China’s Investments into Russian Regions

2019 ◽  
pp. 35-45
Author(s):  
Victoria Batmanova ◽  
Ellada Tikhonovich ◽  
Tatyana Chigareva ◽  
Yuan Lyudai
Keyword(s):  
Foreign Direct Investments ◽  
Belt And Road Initiative ◽  
Russian Regions ◽  
Republic Of China ◽  
The Usa ◽  
Belt And Road ◽  
The Government ◽  
The One ◽  
Investment Process ◽  
The Belt And Road

The article examines the growing role of China in global investments. During 15 years of economic development of the country, the People’s Republic of China (PRC) became the second country in the world acting as a recipient of investments and the second (third) investor sending its funds abroad. After the maximum volume of foreign direct investments (FDI) from the PRC in 2016, 2017 was marked by the drop of FDI. This is connected with China’s control over FDI withdrawal from the country, increasing protectionism from other countries and the aggravating situation for Chinese investors in foreign markets. The drop of investments is connected with a number of reasons. On the one hand, the government of China has strengthened the control over the capital drain from the country in the form of investments. Another reason is the growth of trade protectionism. The complicating external conditions for Chinese investors in connection with the policy of the USA are also worth paying attention to. The 19th National Congress of China mentioned “Belt and Road Initiative” (BRI) strategy as the main plan for organizing the investment process in the nearest future. Today the effort concentration process (investments into infrastructure, interaction with the countries along the new economic silk belt) is observed. Russia and its regions are included into the Northern corridor of the Belt and Road Initiative and can leverage the advantages of the cooperation with China. China has already invested funds into perspective projects in Russian regions and in the nearest future they are expected to grow within the Belt and Road Initiative.

GMS Economic Corridors Under the Belt and Road Initiative

2019 ◽  
Vol 1 (2) ◽  
pp. 183-206
Author(s):  
Masami Ishida
Keyword(s):  
High Speed ◽  
Yunnan Province ◽  
Lao Pdr ◽  
The Other ◽  
Transport Infrastructure ◽  
Belt And Road Initiative ◽  
Other Hand ◽  
Belt And Road ◽  
The Government ◽  
The Belt And Road

The government of China promotes the development of expressways and high-speed expressways in Greater Mekong Subregion (GMS) and tries to connect the major cities of the subregion and Kunming under the Belt and Road Initiative (BRI). First, this article reviews the development schemes in the subregion including GMS economic cooperation and the BRI. Next, it introduces the development of the transport infrastructure, including expressways and high-speed railways, connecting Kunming and Lao People’s Democratic Republic (Lao PDR), Thailand, Myanmar and Vietnam. Thereafter, it compares the total costs of the projects and how other GMS countries negotiate with China. Seeing the sections of the expressways and railways in Yunnan Province, the shares of some sections occupied by bridges and tunnels are higher than 20 per cent due to the mountainous land feature of Yunnan Province. On the other hand, the railway in Lao PDR passes through the mountainous areas, and they adopted higher specification as same as in Yunnan Province. Consequently, the debt-default risk of Lao PDR has increased. On the other hand, Thailand repeated tough negotiations with China and made efforts not to increase the total cost. The negotiations of Lao PDR and Thailand with China are illustrated in this article. JEL Codes: O18, R10, R41, R58

scholarly journals Dispute Settlement in the Belt and Road Initiative: Lessons from the Singapore Experience

2020 ◽  
Vol 8 (1) ◽  
pp. 30-39
Author(s):  
Justice Steven Chong
Keyword(s):  
Dispute Resolution ◽  
Dispute Settlement ◽  
Legal Framework ◽  
Silk Road ◽  
Belt And Road Initiative ◽  
Business Law ◽  
Maritime Silk Road ◽  
Belt And Road ◽  
The Belt And Road

Abstract Historically, Singapore has played an important role in the growth and success of the old maritime Silk Road. Today, Singapore remains an important stop on the Belt and Road, though its advantages now also lie in its position as a trusted, neutral forum for the efficient resolution of disputes as well as a platform for the sharing of ideas for the development of a legal framework for dispute resolution in the Belt and Road Initiative. Three initiatives have been taken by Singapore to strengthen its new position, including the Asian Business Law Institute, the Singapore International Commercial Court, and the Singapore–China Annual Legal and Judicial Roundtable.

scholarly journals Understanding of CSFs in the Application of Public-Private Partnership (PPP) Toll Expressway in Malaysia

2019 ◽  
Vol 9 (1) ◽  
pp. 2082-2087
Keyword(s):  
Success Factors ◽  
Descriptive Analysis ◽  
Legal Framework ◽  
Public Private Partnership ◽  
Private Partnership ◽  
Factors Affecting ◽  
Public Investments ◽  
Innovation Cluster ◽  
Critical Success ◽  
The Government

Expressways are extremely expensive to build and maintain. A major infrastructure project and services involve massive public investments starting from planning, land acquisition, grading, paving and other expenditure. As an alternative, Public Private Partnership (PPP) is a popular tool for the government to cope and meet the increasingly demand by capitalising on private sectors ‘resource and expertise. Given the inherent advantages of PPP model over conventional model, the PPP model was highly favoured and adopted for toll expressway development in Malaysia. Many studies have been made on PPP in the literature but very few have been conducted to investigate factors affecting adoption of PPP toll expressway in Malaysia. Thus, this paper attempts to register all these Critical Success Factors (CSFs) from available journal articles published since 2012. Twenty (20) articles were identified and all the CSFs in them were registered in one list. A two stage exploratory sequential mixed method design was adopted. The first stage was to list all the 161 CSFs that illustrated in the articles and qualitatively analysed them (using thematic analysis) and this resulted in reducing the number to 77. Then these 77 themes of CSFs went through of consolidating exercise into grouping them under the relevant Clusters. Overall, there are nine (9) clusters of criteria of CSFs that can be consolidated as factors affecting on adoption of PPP namely;(1) risks cluster, (2) governmental influence cluster, (3)project viability cluster, (4)organisational cluster, (5)economic and financial cluster, (6)legal framework cluster, (7)technology and innovation cluster, (8) social and environment cluster, and (9) trust cluster. The consolidated nine (9) clusters of CSFs list then went through a final stage of analysis for validation. A set of questionnaire to validate the degree of importance of these nine (9) clusters of factor affecting was prepared and sent to thirty (30) experts in PPP from three (3) main sectors; public, private and academic. The descriptive analysis was done by using Statistical Package for Social Sciences (SPSS) Version 23.0 to differentiate these nine (9) clusters of factor affecting through their mean score. Finally, based on the group mean score value higher than 3.95, three (3) clusters of CSFs were selected as the most factor affecting in adoption of PPP namely; governmental influence, project viability and trust. This list is recommended to be considered in future studies of the influencing factors of involvement private sectors into PPP particularly on expressway projects.

Financing the Belt and Road Initiative: Can Singapore Help in Securitizing It?

2020 ◽  
Vol 8 (1) ◽  
pp. 197-223
Author(s):  
Hans Tjio
Keyword(s):  
New York ◽  
Global Financial Crisis ◽  
Aggregate Demand ◽  
Project Finance ◽  
Marshall Plan ◽  
Belt And Road Initiative ◽  
Real Economy ◽  
The West ◽  
Belt And Road ◽  
The Government

Abstract China’s ambitious Belt and Road Initiative (BRI) is perhaps the modern equivalent of the Marshall Plan and will hopefully provide the aggregate demand lost due to the global financial crisis. At the moment, much of the financing has come from the government and financial institutions. If more private sector financing is needed for the BRI, this could involve, perhaps, having established ways of project finance that we have seen with the large infrastructural projects of the past as well as modern methods of asset securitization. Lawyers and financiers would be needed, and the West has traditionally held a comparative advantage in these entities, whereas China’s advantage is in building and making things. Singapore, perhaps, is now well placed to offer its services in a way that brings the East and the West together and that would hopefully provide a balanced approach that distributes benefits to all involved in the BRI. Its experiences are far from perfect, but it has learned painful lessons to position itself as a financial centre supporting the real economy that can now hopefully begin to rival New York, London, and Hong Kong. The areas examined in this article include Singapore’s development of property and infrastructural trusts, its bond and derivatives markets, its restructuring regime, and its legal expertise in project finance.

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