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Emerging countries are no longer bystanders of policies imposed by the more established international powers and should seize the opportunity to share ideas which now deserve an international hearing, he said.
"The world is changing and we must change with it. We have a duty to each other and to our people to get it right; to seek to do a better job and achieve a better outcome for the global community. Emerging nations have citizens that deserve protection too and this time we have ideas that deserve international hearing. But having a hand in the reshaping of the new financial architecture is not just an opportunity; it is a responsibility - one that now devolves on all of us,"
Shaikh Mohammed said.
Shaikh Mohammed added that there are certain essential foundations that any financial structure requires if it is to be strong and sustainable.
"First, the laws that pertain to finance and business must be transparent - so that businesses, banks, investors, everyone - know where they stand and trust laws to be fair, practical and consistent. Second, financial regulation must be firm as well as fair. Third, entrepreneurs and business must be encouraged - and with an up-skilled business environment, education and training become increasingly important. And, of course, we must all look beyond our borders and embrace regional partnership," he said.
Shaikh Mohammed noted that just as the Europeans have done with the European Union and the North Americans with NAFTA, dramatic changes in regional cooperation are now underway throughout much of the emerging world. China, Japan and Korea are talking about plans for a free trade agreement. And for an international business or investor, the six nations of the Gulf Cooperation Council (GCC) already represent a single market approaching one trillion dollars and comparable in financial scale to India, he said.
In Bahrain itself, such a commitment has been embraced by the Government and bodies such as the Central Bank of Bahrain (CBB) and EDB, which has the overall responsibility for formulating and overseeing the economic strategy of the Kingdom and creating the right climate to attract foreign investment. A number of domestic measures have been taken to strengthen long term sustainability and prosperity, including a prudent fiscal and monetary approach, long term strategy of economic diversification and a tried and tested regulatory framework.
This approach is enshrined in Bahrain's Vision 2030 and National Economic Strategy, both committed to maintaining the optimum business environment that will attract foreign investment and ultimately elevate national living standards by creating greater opportunities for Bahrainis.
Shaikh Mohammed explained, "The CBB is our sole regulatory body for finance. So banks and investment houses and everyone else have the clarity that comes from dealing with one authority. Moreover, the CBB takes care to consult widely among the financial institutions that will be affected by changes in regulation; they have their say and we expect them to observe the rules meticulously. This approach has served us well in recent times. People once told us we were too conservative; nobody tells us that now."
"For 90 years, we have been investing and improving our education - regardless of gender or income - so that now we can offer business a skilled workforce. That's why we have opened our new Polytechnic, the first of its kind in the region. And while we invest in education and infrastructure, we take care to keep taxation low so that companies know they can reinvest their profits in building up the business and creating more employment and wider prosperity," he added.
He added that Bahrain has already made a significant contribution to a better financial architecture through the development of Islamic finance. The Kingdom was the first in the region to nurture its concepts and now has by far the largest number of Islamic banking entities in the world. More than 30 countries have sought Bahrain's support to develop their own Shari'a-compliant banking.
"We in Bahrain pride ourselves on our commitment and investment in Islamic finance. The ethical content of Shari'a finance can be of great value to the global economy and exerts an increasingly powerful appeal to many people worldwide. This commitment to ethical finance is by no means the least of the contributions the emerging world can make to strengthening the financial architecture on which the world depends. It is an idea whose time has come," he concluded.
Posted by Rana Mesbah
