Theory, Practice and Education
Edited by Mohamed Ariff and Munawar Iqbal
9. Shari’ah-consistent investment vehicles in Malaysia Kabir Hassan and Eric Girard 1.0 INTRODUCTION Islamic finance offers unique but alternative financial system based on religious doctrine. The industry has been growing tremendously at an average 15–17 per cent rate over the last years. Total asset value is expected to be $2.8 trillion in 2015 compared to $1.4 trillion in 2010 and only $700 billion in 2005 (IFSB Website 2005). Islamic finance is prevalent in all dimensions of financial services: debt and capital markets including mutual funds, insurance, asset management, structured and project financing and derivatives. The Islamic finance market is mainly concentrated in Islamic countries of the Middle East, North Africa and South-east Asia, but it is gaining popularity in non-Muslim and Muslim-minority countries such as the US, UK, and Europe and India. Malaysia is the first Islamic country to have its own Islam-based stock exchange, the Bursa Malaysia Berhad. This subset of the country’s main stock market was launched on March 18, 2005. The exchange lists equities, derivatives and offshore markets – but only those that adhere to Islamic tenets. For example, companies cannot actively seek revenues from interest income, gambling, life insurance, tobacco, or alcohol. In short, Malaysia has done what no other country has done – accommodated the tenets of Islamic law in its economy and its stock market by setting up separate listings. These companies allow the devout to invest with a conscience and help foster the Islamic economy. This Malaysian system would not work in many other...
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.