Islamic banking goals set for great heights

The 2-day conference was attended by more than 200 international business and government delegates from 15 countries, and highlighted the important trends within Islamic and Shari'ah-compliant international investment and project finance.

Opened by HE Sheikh Abdullah Bin Saud Al Thani, Governor of Qatar Central Bank, in addition to keynote speakers from leading industry players, ensured that topics such as Shari'ah compliance, the impact on infrastructure finance structures & innovation of Islamic infrastructure finance and the role of the Shari'ah scholars were debated from all sides.

What was clear from the feedback gathered from delegates and attendees was that the potential for future events like this "is enormous". Being a new concept, very much at the embryonic stage of the evolutionary process, the conference was "well timed in terms of identifying where the issues are and the potential for solutions for those issues."

"We've seen bankers, project developers and government agencies and we've seen the opportunities for further development in the market. Where we are now in terms of the involvement of Islamic Financial Institutions in project finance and big infrastructure deals [is] still at the very early stages but the potential there is huge for Islamic banks and conventional banks to work together.... The capital is there and the capabilities are there...." Said David Mclean, Executive Director, Middle East Global Advisors (MEGA), the organisers of the event.

According to IMF data, the number of Islamic financial Institutions worldwide has grown to over 300 institutions worldwide, much of it in the GCC, where increasing demand for Islamic products, increased wealth and liquidity due to higher oil prices and rising inward investment are prevalent.

"It is also attracting the right people," highlighted Andrew Steel, Managing Director, Head of Energy, Utilities & project Finance, Fitch Ratings. "People and risk professionals are not only aware of the market but are also very accessible....Utilize their expertise!", he urged.

The last session, a PowerTable discussion spearheaded by Ernst & Young's Sameer Abdi, Executive Manager, Islamic Financial Service Group, left participants of the forum with key questions to think about:
• "What does the near future hold for infrastructure finance using Islamic mechanisms?"
• "How can conventional and Islamic banks work more effectively together?"

Though in its' infancy, there is a clear movement towards growing Islamic and Shari'ah-compliant banking structures. Reiterating HE Sheikh Abdullah Bin Saud Al Thani's closing words to Qatari banks "in particular and international banks in general", that "effective risk management methods and applications consistent with" their own country's regulations must be taken, Rajeev Singh, Partner, Ernst & Young advised that the standardisations and regulations that must be taken by governments should not and do not restrict innovations in the field.

As with any new budding product there are certainly obstacles that still need to be overcome, but with such an optimistic picture and array of talent and innovation that has been attracted, it is expected that in Qatar alone, government and public investment is expected to total about US$ 130 billion over the coming years. That is good investment for any future.