By NNN-Bernama,
Singapore : Muslims in Southeast Asian countries could
improve their lot economically if they have access to Islamic banking, former
Malaysian prime minister Dr Mahathir Mohamad said.
He said the majority of Muslims in the region had no banks where they could borrow money according to the tenets of Islam, and this had hindered their progress in the economic field.
Speaking at the Islamic Finance Conference organised by the Association of Malay Entrepreneurs of Singapore (Kesuma) here today, Mahathir said with Islamic banking, Muslims who were concerned about “riba” (interest) could now loan out and invest money freely.
“Islamic banking is here to stay,” he said, adding that its future was very bright, especially in the Southeast Asian region, which was fast growing and had a big market with over 500 million people, with the majority being Muslims.
He pointed out that Islamic banking could play an important role in helping Muslims in the region, especially to get out from the clutch of poverty, and catch up with the non-Muslims who had long prospered.
Mahathir said there was a correlation between the growth of Islamic banking
and the Muslim economy.
He said with Islamic banking, Muslims in the region could easily have access to capital they needed to grow their businesses or increase their wealth.
However, he cautioned that apart from accessibility to capital, Muslims must
have the skills and knowledge on how to run business and manage their money if
they wanted to succeed in the economic field.
The former prime minister also emphasised the need for Muslims to learn and venture into all kinds of business such as trading, services and manufacturing to widen their capacity and capability in the field.
Mahathir said if the Muslims were successful in their economic endeavours,
the non-Muslims would also want to do business with them, and even borrow money
from the Islamic banks.
He pointed out that Islamic banking had strong safeguards compared to
conventional banking which was open to abuse as shown in the recent global
banking collapse following the worldwide economic crisis.
“Islamic banking is immune to crooked dealings, and it is more superior to
conventional banking,” Mahathir said, adding that those who managed Islamic
banks strictly followed and respected the Islamic injunctions.
To a question on the use of gold dinar in Kelantan, the former prime minister said the state had taken off too early.
“When I suggested that we use gold dinar, it was meant to be used in the settlement of payment for trading between two countries or more,” Mahathir said,
adding that currently many countries still preferred to use US dollars.
Saying it was not practical to use gold dinar within the domestic economy, he added: “We cannot use gold dinar in everyday transactions, as one has to carry a lot of gold coins in the pocket and you can get robbed.”
To another question, Mahathir said it was very difficult to get the 52 Muslim countries in the world to act together at the moment to utilise Islamic banking or have an Islamic monetary system.
He said many Muslim countries still lacked strong political leadership and were also very dependent on the West, especially the United States, for economic survival to go against the current international banking and monetary system.