Daily Trust (Abuja)

11 March 2009

Nigeria: Islamic Financial System Solution to Economic Meltdown - Bintube

Abubakar Buba — The Managing Director of Jaiz International Bank, Alhaji Mustapha Bintube, has said the solution to the current global financial meltdown lies with the Islamic financial system.

Bintube gave the advice in Abuja while delivering a lecture entitled: 'Global Economic Meltdown: Islamic Perspective and Solution' at the second Mawlud Nabiyy public lecture organised by the Muslim Media Practitioners of Nigeria (MMPN), Abuja branch.

He said the Islamic Financial system was capable of minimizing the severity of the financial crisis and economic meltdown.

"The Islamic financial system can engender greater discipline, equity and justice in the system through risk/reward sharing, moral screening and providing affordable finance to the poor," Bintube said.

He said that though the Islamic finance industry was still about 30 years old in the global financial system, its consistent growth, was capable of solving the economic recession, if fully applied.

While urging wealthy Muslims to embrace Islamic Banking System in Nigeria, Bintube said the Islamic Banking was capable of attracting foreign direct investment worth of $1.5 Trillion and at a growth of 15 per cent to 20 per cent in a year.

Bintube said that Jaiz Bank, a proposed Islamic Bank in Nigeria, had a delay of operation due to the sudden increase in capital base of banking operation from N2 billion to N25 billion by the Central bank of Nigeria.

He however said that the CBN had just released regulatory framework which had hindered some foreign investors from coming to Nigeria to invest in the Islamic Banking sector.

He attributed the global economic meltdown to huge loan interest charges, corruption and fraud which the ideal Islamic Bank frowned at.

"The Islamic finance system therefore does not allow creation of debt through direct lending and borrowing on interest," Bintube said.

In his presentation, former deputy governor of Central Bank of Nigeria (CBN), Dr Obadiah Mailafiya, said US was able to control global financial crisis years ago but the combat was beyond its power when it spent one billion dollars on Iraq and Afghanistan daily.

Mailafiya, who is the chairman, Centre for Policy and Economic Research (CEPER) suggested that the Muslims should take Islamic Bank as solution to economic meltdown as it ensured safety of their investments.

In his welcome address, MMPN chairman, Alhaji Abdur-Rahman Balogun, said the lecture was to educate Nigerians and to portray to the world that Islam has solution to all problems.

"The choice of today's (yesterday) topic was informed by our burning desire to educate and inform the public correctly on the global financial crisis and find the way forward from the point of view of Islam in line with MMPN vision and mission," he said.

Goodwill messages were received from the envoys of Iran and Iraq in Nigeria as well and from Alhaji Aminu Bello Masari, former Speaker, House of Representatives.

The lecture was to mark the birthday of Prophet Muhammad, who was born on Monday 12th Rabiul Awwal, 570, which coincided with March 9, which was declared as public holiday by the federal government of Nigeria on Monday.

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