Participation of Islamic banks in projects strengthens financial discipline - the president of IDB

ASTANA. March 11. KAZINFORM /Muratbek Makulbekov/ Dr. Ahmad Mohamed Ali, President of the Islamic Development Bank highly appraised N. Nazarbayev?s ideas outlined in the article ?Keys to the Crisis?. According to him, the Islamic banks have been protected from the adverse impact of the crisis due to some specific features of financial institutions in these countries. For instance, sharing of gain on deposits leads to financial discipline and stability. The Islamic banks are interested in success of the projects they finance. Therefore their participation in the projects strengthens financial discipline.

?The basic principle of Islamic finance is ?don?t sell what you don?t possess?. Restriction on sale of debts also excludes unhealthy speculative activities. That is why credits may grow proportionally to the growth in real sector of economy?, Dr. Ahmad Mohamed Ali said at the II Astana Economic Forum. Besides, as the IDB President noted, control over the internal regulation in accordance with Shari?ah is an essential part of investment decisions. All these peculiarities give two main positive results. Firstly, most of the Islamic banks have not suffered from the crisis. And secondly, the Islamic banks inform of revenue this year. ?This shows the growth of trust to the Islamic financial institutions amid the global crisis?, Dr. Ahmad Mohamed Ali resumed.