21 May 2014

Mauritius well poised to develop a buoyant Islamic financial services industry

Mauritius as an international financial centre of repute is well poised to sustain and further develop a buoyant Islamic financial services industry which is a new frontier for the country and is well positioned to act as a bridge to Africa, said the Prime Minister, Dr Navinchandra Ramgoolam.

He was speaking this morning at the opening of the 11th Islamic Financial Services Board (IFSB) summit on the theme: New Markets and Frontiers for Islamic Finance: Innovation and the Regulatory Perimeter, at Le Meridien Hotel, Pointe aux Piments.

Dr Ramgoolam highlighted that Mauritius is often referred to as Africa’s growth success story and has succeeded in becoming an upper middle income country with a thriving financial services sector. This, is mostly associated with a two-fold dimension thus positioning Mauritius as an ideal location for the holding of the IFSB summit, he added. Firstly, a thriving internationally oriented offshore financial market that is increasingly serving the needs of global investors and secondly the deeply engrained institutional necessity for building institutions and business that are economically successful. This added the PM is the prerequisite to build successfully an Islamic Finance industry in Mauritius.

According to the PM, in the wake of the global financial crisis, we need to stay ahead of the curve and adopt risk-sharing which is at the heart of Islamic Finance, which offers genuine advantages to any financial system. What is needed, stressed the PM, is to islamize conventional banking with focus on the provision of real economic services and risk sharing with effective regulations.

Dr Ramgoolam also spoke on the Islamic investments across the world totaling to 3 trillion US dollars and out of which only one percent of the investment is channeled into Africa. In this regard, he made an appeal to the Islamic Financial services industry to tap the tremendous opportunities that are rising on the African continent.

Commenting on the global financial crisis which has led to the collapses of many economies across the world, the PM said that Mauritius with a more conservative and rigorous regulatory system, has escaped the worst of the primary impact and has sufficiently been resilient with the secondary impact of the problems affecting our main trading partners in Europe.

Over 300 partcipants both local and foreign from all sectors of the financial services industry across the globe are attending the one and a half day summit aiming at providing a gateway for the sharing of new ideas, services and new markets to extend the frontiers of Islamic Finance and define its future role and how Islamic finance has been serving the world in this changing environment and how it can progress further.

Among the topics to be discussed are: global overview of the Islamic Financial Services Industry (IFSI): Outlook and Policy Developments; Legal and Regulatory Environment of Islamic Finance; Sukūk; Market Development and Regulation; the role of Islamic Finance in Economic Development: promoting financial inclusion, sustaining innovation, expanding the regulatory perimeter-Striking a Balance; and new and Emerging Islamic Finance Jurisdictions: Opportunities and Challenges Ahead.

The Islamic Financial Services Board (IFSB) set up in 2003, is an international standard-setting organisation that promotes and enhances the soundness and stability of the Islamic Financial services industry by issuing global prudential standards and guiding principles for the industry, broadly defined to include banking, capital markets and insurance sectors.

As at 27 March 2014, the 184 members of the IFSB comprises 59 regulatory and supervisory authorities , eight international inter-governmental organisations and 111 market players and professional firms operating in 45 jurisdictions. The IFSB also conducts research and coordinates initiatives on industry-related issues, as well as organises roundtables, seminars and conferences for regulators and industry stakeholders. 

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