Türkiye has persistently proven a dedication to rising its Islamic finance business and positioned itself as a middle for participation banking and investments, in response to a senior govt.
“Türkiye has made important contributions to advancing Islamic banking and luring capital from Islamic nations,” Yousef Hassan Khalawi, secretary-general of the Islamic Chamber of Commerce, Industry and Agriculture, stated.
Türkiye has been pitching itself as a horny spot for capital from international locations with a predominantly Muslim inhabitants, and selling Islamic finance has been a part of authorities plans to spice up industrial ties with the Gulf and diversify the nation’s investor base.
Bridging the East and West makes Türkiye “a horny vacation spot for investments from Islamic international locations,” Khalawi instructed Daily Sabah in an interview.
“Its proximity to Europe, the Middle East and Asia provides access to a wide range of markets and business opportunities. Türkiye has actively leveraged this advantage to attract investments, including those from Islamic countries,” he famous.
Türkiye has come a great distance, however there’s at all times a possibility for enchancment and there are extra different steps that ought to be taken to advertise the nation as a number one vacation spot for Islamic finance, in response to Khalawi.
“Türkiye can continue to strengthen its regulatory framework, promote financial education on Islamic finance, increase the variety of Shariah-compliant products and services, and strengthen its engagement with Islamic financial institutions and investors globally to increase its role in facilitating Islamic finance and luring investments,” he stated.
Türkiye boasts a complete authorized and regulatory framework to help the Islamic finance business. It launched the Participation Banking Law in 1983, which supplied a stable basis for Islamic banking operations. Its regulatory our bodies such because the Banking Regulation and Supervision Agency (BDDK) and the Capital Markets Board (SPK) oversee and regulate Islamic monetary establishments.
Türkiye has applied legislative and regulatory reforms to create a supportive setting for Islamic finance. It enacted the legal guidelines and amendments to its current authorized frames and rules to accommodate Sharia-compliant monetary services and products, “ensuring a level playing field for Islamic finance institutions,” in response to Khalawi.
Islamic finance in Türkiye has been predominantly pushed by home Islamic banks, identified regionally as participation banks. The variety of participation lenders within the nation reached eight as of May this yr.
The banks boasted TL 1.4 trillion ($52 billion) in belongings as of May, in response to Participation Banks Association of Türkiye (TKBB) knowledge. They are operating a community of greater than 1,400 branches throughout Türkiye and make use of some 18,650 folks.
The member banks noticed their web profitability improve by 443% and asset measurement develop by 65.6% to just about TL 1.19 trillion as of the tip of 2022, in response to the affiliation. Their share within the banking sector reached 8.4%.
Robust market, shopper base
“Türkiye’s Islamic banks have attracted significant investments and performed big numbers to be a model of excellence to the whole world, as well as catered to the financial needs of the local population,” Khalawi stated.
Khalawi, who can be secretary-general of AlBaraka Forum, stated they’re trying on the alternatives in Türkiye, reaffirmed by many main occasions and applications he says they’d devoted “to empower the Turkish market with the opportunities, awareness and developments that required with consideration of the contemporary challenges and changes.”
“We are providing a global platform and forum for stakeholders from around the world to exchange ideas, share best practices and explore opportunities for collaboration to contribute to promoting the Islamic Finance and economics culture by facilitating meaningful discussions and contributing to the growth and development of the Islamic finance sector in Türkiye,” he added.
Khalawi additional burdened a number of elements that he stated contribute to Türkiye’s attractiveness as a vacation spot for Islamic finance and business improvement, citing its strong home market, sizeable shopper base and demand for Shariah-compliant monetary services and products.
“Türkiye has a large and dynamic domestic market, with customers and users from all around the globe. This sizable consumer base provides significant opportunities for businesses and investors in various sectors, including Islamic finance. The demand for Shariah-compliant financial products and services is growing within the country, which further enhances Türkiye’s appeal as an Islamic finance destination,” he defined.
He additionally referred to historic hyperlinks, saying that the Islamic cultural and historic background and heritage of Türkiye established a robust floor for contemporary Islamic finance and banking providers.
“This historical legacy, combined with the country’s commitment to preserving Islamic traditions, makes Türkiye an attractive destination for Islamic finance and business development. It creates a sense of familiarity and cultural affinity for investors and businesses from Islamic countries.”
Policies, incentives
The Turkish authorities has over time applied a spread of insurance policies and initiatives to draw Islamic finance and business improvement.
Khalawi stated these embody offering incentives for international buyers, creating favorable business rules, and facilitating ease of doing business. He additionally cited authorities businesses and establishments that have been established to help and promote Islamic finance, such because the TKBB and the Türkiye Wealth Fund (TWF).
The help and facilitation of the operation of the Islamic financial system, notably Islamic finance and banking, in Türkiye is tremendously aided by the monetary infrastructure, in response to Khalawi.
“Türkiye has a well-developed infrastructure for Islamic finance. It has a robust network of participation banks and Islamic financial institutions that offer a wide range of Shariah-compliant products and services. The presence of these institutions, along with a supportive legal and regulatory framework, creates a conducive environment for Islamic finance and attracts investors and businesses looking to engage in Shariah-compliant activities,” he famous.
He burdened the established infrastructure and the nation’s readiness are providing numerous funding alternatives throughout numerous sectors, together with actual property, agriculture, business, expertise, infrastructure, vitality, tourism and manufacturing.
“These sectors present attractive prospects for Islamic finance and business development. Türkiye’s commitment to infrastructure development and investment in strategic industries further enhances the investment landscape for Islamic finance institutions and investors,” he added.
‘Premier location’
Khalawi highlighted that sturdy infrastructure and market flexibility deliver openness to the market and merchandise, which are a magnet for clients, entrepreneurs and buyers from all all over the world.
“This particular point is coming from the quality of the products and the premium geographical location with a relatively low level of trade barriers, facilitating the import and export of goods and services,” he stated.
“By making the most of these elements, Türkiye maintains its position as a desirable location for the growth of Islamic finance and commerce, strengthening its links with other Islamic nations and luring foreign investment from all over the world.”
According to Khalawi, Türkiye’s authorized formation has created an open setting for establishing and selling Islamic finance and banking establishments by establishing country-based participation banks, providing a variety of Shariah-compliant monetary merchandise which can be based on the understanding of the finance points and Shariah issues.
He stated the nation has acknowledged the significance of economic schooling and consciousness in selling Islamic finance. He cited the federal government’s initiatives to extend consciousness and understanding of Islamic finance among the many public, companies and buyers. This contains organizing seminars, workshops and coaching applications to disseminate information about Islamic finance ideas and practices.
“These actions show Türkey’s dedication to advancing Islamic banking and establishing itself as a premier location in this industry,” Khalawi stated.
“Türkiye has made significant progress toward attracting Islamic finance and establishing itself as an Islamic finance hub by enacting supportive legislation, encouraging the expansion of participation banks, expanding the Sukuk market, forging international alliances, raising financial awareness, and investing in infrastructure.”
Source: www.dailysabah.com
