Is your economy sharia compliant?

The Guardian Also linked to by the Wall Street Journal Our system of sovereign sukuk ratings could benefit the global economy and promote better cross-cultural relations Imaduddin Ahmed Wednesday 2 February 2011 Think of two of the most common problems highlighted in today’s news: the state of the global economy and violence at the hands of Islamists. Here’s a possible remedy to both: a sovereign sukuk rating system. Such a rating would show which economies are sharia-compliant and hence suitable candidates for asset-backed Islamic bonds in the form of sovereign sukuks. The metrics used in such a rating would mean … Continue reading Is your economy sharia compliant?

What if the world had been following Islamic financial practices?

The Guardian Also linked to by Bloomberg Businessweek It has its limitations, but it’s worth considering how the Islamic approach to banking might have prevented the financial crisis Imaduddin Ahmed 7 January 2011 Sub-prime loans, which caused housing foreclosures in the US, are not allowed in Islamic finance. Photograph: Alex Wong/Getty Images Imagine a world without a financial crisis. No moral hazard, so brokers won’t sell mortgages without carrying out appropriate credit checks. Imagine banks not deliberately selling complex derivatives, knowing that they will be worthless. No short-selling speculation, so companies tinkering on the edge won’t be pushed over. Imagine … Continue reading What if the world had been following Islamic financial practices?

China’s economic rise will not make it the dominant political power

Given its domestic market size, resources and untapped potential for leverage, China, according to Goldman Sachs’ projected rates of growth, is set to become the largest state economy by 2030.[1] The other BRIC economies, meanwhile, are projected to an aggregate economy worth half of the USA’s by that time, which will be relegated to the second largest economy. By 2050, China’s economy will, according to the same projections, be worth almost double the USA’s. The core EU states and Japan’s economies will have grown relatively little. A discussion, therefore, of China’s economy becoming the largest economy is relevant. This paper attempts to model the incentives, constraints and … Continue reading China’s economic rise will not make it the dominant political power

Pakistan, rebranded

The Boston Globe By Imaduddin Ahmed and Kapil Komireddi March 25, 2010 Pop-star Ali Zafar GOOGLE “PAKISTAN is’’ and you’ll find a host of common searches: “a failed state,’’ “a terrorist country,’’ “doomed’’ and — encompassing all of the above — “the problem.’’ Pakistan’s image is both the effect and a potential cause of terrorism: it scares away business investments, and leaves jobless youth without opportunities, ripe for mullahs who promise riches in the afterlife. In significant ways, however, the actual security risks faced by private enterprises in Pakistan is no greater than the violent threat they face in India. … Continue reading Pakistan, rebranded