Iranians Feel The Bite Of Tougher Sanctions

No nation has been sanctioned so frequently, and so thoroughly, as the Islamic Republic of Iran. For more than 30 years, the country has been under some kind of punitive economic measure.

The goal has been to prevent Iran from receiving and using the billions of dollars in oil profits that finance its nuclear program.

But none have been tougher, according to President Obama, than the sanctions his administration has imposed on Iran’s banking system.

The evidence suggests that these sanctions have made it difficult for Iran to carry out international transactions. And they have forced ordinary Iranians into activities that under other circumstances might be called money laundering.

Two Perspectives

Until recently, sanctions imposed on Iran — by the United States and by the U.N. Security Council — have not changed Iran’s determination to expand its nuclear activities.

But on the last day of December, Obama signed into law a bill that could ban foreign banks from operating in the United States if they carry out transactions with the Central Bank of Iran.

That step came after several years of sanctions tightening, according to the president.

“What we’ve been able to do over the last three year is mobilize unprecedented, crippling sanctions on Iran,” Obama said.

That pressure has forced many, perhaps most, international banks to think twice about doing business with Iran.

“Iran is feeling the bite of these sanctions in a substantial way. The world is unified. Iran is politically isolated,” Obama said.

Of course, that’s not the way Iran’s supreme leader, Ayatollah Ali Khamenei, sees it.

“Obama has said he will bring Iran to its knees through sanctions,” Khamenei told a national television audience a few days ago. “This is a delusion. They call these paralyzing sanctions — for the past year? We’ve been under sanctions for 30 years.”

Despite the supreme leader’s words, there’s no doubt the current sanctions have been disruptive for the government and for many of Iran’s people, says Muhammad Sahimi, a professor at the University of Southern California who writes regularly for the website Tehran Bureau.

“It has greatly tightened and restricted the freedom that the Iranian government needed to carry out all these transactions,” Sahimi says. “And that in turn, of course, has affected the lives of ordinary Iranians.”

Growth In Money Smuggling

The most dramatic development has been the collapse of Iran’s currency, the rial. Over the past few months, it has lost more than half its value against the dollar, sparking a panic that saw Iranians desperate to flee the rial and turn their holdings into hard currency.

This has put enormous pressure on Iran’s foreign currency reserves. As a result, Sahimi notes, the government imposed stiff restrictions, under penalty of imprisonment, on how much foreign currency ordinary Iranians can hold or send out of the country.

“So it has become very difficult to many Iranians to actually either send any money to outside Iran or sell their assets in Iran and get it out of Iran,” Sahimi says.

Ordinary Iranians have become money smugglers, hoarding their dollars, filling suitcases with cash, and traveling out of Iran to make deposits into international banks.

Some people have even resorted to taking stashes of cash by speedboat across the Persian Gulf at night to make their deposits in banks on the other side.

One of the most popular destinations is Dubai, says Hossein Askari, an expert on Iran’s economy at George Washington University. Its banks have bowed to U.S. pressure to forgo dealings with Iran’s government, but not with individual Iranians.

“And when you get on the other side, many countries, especially in Dubai, nobody asks you any questions,” Askari says.

China And India Loopholes

At the government level, banks in India and China are still doing business with Iran. China imports a great deal of Iran’s oil, so it has established accounts for Iran in China amounting to billions of dollars.

But China reportedly has imposed exorbitant fees and restrictions on these accounts, a development just now becoming known in Iran, says USC’s Sahimi.

“That is beginning to change the perception, even within Iran, whether China is really Iran’s strategic ally or is just taking advantage of the situation,” he says.

For the sanctions to be fully effective, the United States would have to move to close loopholes like this. Askari is skeptical.

“I don’t think the United States will do that with Indian banks. And I am 100 percent sure it will not do with Chinese banks,” he says

Brands can transform a nation, even change the world, says expert

JEDDAH: Top directors of some of the well-known brands in the region came together on one platform yesterday to discuss how brands conceptualized and developed in the region could be made known worldwide.

Merely creating a brand is not enough, but there ought to be a sustained effort to protect it by not compromising on the product quality that it represents and also guarding against its copying or piracy. The speakers gave this message through their presentations at a panel discussion on “Brand Arabia: Globalizing Regional Value Creation” at the opening session of the final day of the three-day 12th Jeddah Economic Forum. Naïf A. Al-Mutawa, chairman and CEO of TESHKEEL conducted the session.

“Quality, investment, innovation and authenticity were among the key factors that helped a brand to thrive,” a presenter said. “Brands could be developed through a culture of innovation and its appeal promoted through global competitiveness,” said another.

Giving a glaring example of how a regional brand had its appeal internationally, Ata Atmar, managing director of Bateel, said: “Bateel is truly a local brand that has gone international. Just not on paper, but it is known worldwide as a brand of quality dates and certain other food products.

He recalled how the concept of the Bateel brand was developed way back in a small place north of Riyadh. Its first outlet opened in the capital and later in Jeddah, and today it is present in 15 countries including the UK, Dubai and Mumbai.

Explaining how Bateel had protected its brand image over the years, Atmar said: “50 percent of our date production that is of premium quality is marketed under the Bateel brand name, while the remaining 50 percent, which falls short of the high quality standards due to production reasons, is marketed under another brand name.”

The company, with its R&D wing taking care of the brand management, has 15,000 date farms kingdomwide, which produce 20 varieties of dates. The company’s brand image also helped it to produce and market other food and food products, as well as a range of confectionary items over the years. It has emerged as the largest chocolate producer in the Kingdom and the Middle East. What is more, the company also ventured into cafeteria business and now prides itself with its first flagship “Bateel Cafe” that opened in Dubai three years ago. It has followed up with its first Saudi cafe in Riyadh.

Rafi-uddin Shikoh, CEO and managing director of DinarStandard that is dedicated to growth strategies for emerging Muslim markets, said that a brand in the region should have universal Islamic values enshrined in it. “Islam is an important part of the Arab DNA and so its products and services should have a universal appeal as they represent Islamic values, whether food, finance, education, fashion or recreation,” he said.

According to him, Islamic finance is growing in all Islamic countries at the rate of 15 to 20 percent annually, with their Muslim lifestyle market exceeding $2 trillion. It includes food, travel, education, recreation and health. He stressed the importance of social networking sites on the Internet as they are important for communication. “It’s much more important in Saudi Arabia where they lead the world among Facebook users.

” Shikoh also gave the examples of Abdul Latif Jameel whose brand image had become much more popular through its community initiatives. Likewise, Al-Rajhi Bank had popularized its brand image through Islamic finance. However, Shikoh added: “We need an increasing number of Islamic brands to have their presence across the Muslim world, from Turkey to Indonesia and from Malaysia to Morocco. We also need to have brands in service industries like travel and hospitality, although Haj and Umrah do have their presence.”

Referring to some of the countries known for brands, Shikoh gave the example of Germany whose famous brands include BMW, Mercedes and Siemens. “How they came about is interesting; in Germany they enjoy strong government support through the continuous upgrading of infrastructure,” he said.

Hussam R. Abdulqader, head of communication and public relations at Almarai Company, Riyadh, gave a statistical presentation to justify the company’s growing brand image. Since its inception 35 years ago, the company has been vertically integrated, he said, adding that the milk that it produces and distributes comes from 135,000 cows. “If all the cows are lined up one behind the other, they could cover the distance between Riyadh and Dammam. The company, which started with 3,700 employees, today has a 22,500 strong workforce. Another 4,500 workers will be added during the year.

The company boasts seven farms. The company has 1,000 reefers (refrigerated trucks) that distribute dairy products to 70 depots across the GCC. It also has 3,000 trucks that distribute products to 48,000 retail outlets every single day. The company brand has received accolades from Forbes magazine and Financial Times for having gone international. “We communicate with our customers and get regular feedbacks from our satisfied customers. That is how we enjoy our brand loyalty.”

Interbrand’s Regional Director Michael Benson explained what it takes to be a global brand and emphasized that brands are important for every industry. “If you have a strong brand, it will drive choices and generate resources. “Your brand is much more than your logo.

As a consultant, we have built brand images and created some,” he said, adding that the company considered a pioneer in brand evaluation. He gave the examples of BMW, InterContinental hotels, Audi, Qatar Airways, Jumeirah, Google, Nike Aljazeera, Coca Cola, Starbucks, Burj Al Arab and McDonald’s and said they have strengthened their images through innovations.

Replying to a question, Benson hinted that brands are trying to promote themselves on Internet sites or digital platforms. The best option at present is to continue to advertise in the traditional media.

His advice as a consultant: “Concentrate on building your brand and protect it through a legal framework. In fact, brands can transform a nation and even change the world.”

Nigeria: Islamic Development Bank to Invest U.S.$6 Billion in the Country – Executive Director

The Islamic Development Bank (IDB) was formed in October 1975 to foster economic development and social progress of member countries in accordance with Islamic principles. It currently has 56 member countries, Nigeria being the most recent (in 2005) country to become a member. Gambo Shuaibu is an Executive Director at the bank as Nigeria’s representative. In this interview, he said the bank plans to make cumulative investments worth $6 billion in Nigeria in the next three years.

The bank assists member countries in accordance with Islamic principles. Does that mean you don’t give loans? If you do, don’t you charge interest? How does the bank get its investment back?

The bank supports its members in various forms, financially and through technical assistance. It could be grant. There is loan too. The loan is broken into two, ordinary loan and concessionary loan and also through consultancy. Now, when you say in accordance with Islamic principles, it has to do with the way its products are packaged. Interest is forbidden in Islam.

All IDB does is to ensure that its own financial products are packaged in compliance with Islamic laws and basically there is no interest element and they do not finance things that are forbidden Islamically like gambling, prostitution. That is why even hotel business has not been attracting the attention of IDB much due to sale of alcohol. But it does not discriminate against the beneficiary. Only that it has to be structured in a way that it will not contravene the Islamic principles.

There are a number of predominantly Christian countries who are members of the IDB. It doesn’t discriminate who benefit. It is the packaging that differs. In the conventional banks, when you go there to take loan to purchase a house maybe, the main component is interest that you have to pay.

Nigeria has increased its subscription in the bank. How much is that and what is Nigeria’s position in the bank in terms of ranking?

When we first joined, it was at a very insignificant level of 2.2 percent. The increase now is at the level of 7.6 percent of the ordinary shares capital. The figures I gave the other day was the authorized capital which is $30 billion. The shareholding fund of the bank is just about 6.3 billion Islamic dinar which is equivalent to about $10 billion. The shareholding fund includes reserve and profit. The paid up capital is $4.6 billion.

When you are calculating the capital of a multilateral development organization, you have to be very careful. Even that includes cash payment and callable shares. Callable share is the portion of the capital that is just there, that you have subscribed to in principles but there is no financial commitment. In the event, the bank is to raise money in the market, the shareholder supporters are called to provide the money.

That is a basic standard. If you were to do the calculation, it should be half of 7.5 percent of the paid up capital which is at present a little over $6 billion. When the last increase of the paid up capital was done in 2006, a substantial portion of it, 70 percent, is payable over a period of 10 years.

Basically, in the next 10 years, the investment of Nigeria in the bank will be in the region of $400 million. I can assure you, given the project that will be financed by the bank in Nigeria, in the next three years; IDB will have invested $2billion in different facilities in the country. This will be used in education, poverty alleviation and other human capital development related projects.

If IDB is investing $2 billion in Nigeria, it has the capacity to generate counterpart funding up to $4billion. That means, we are targeting $6billion investment in the next three years in Nigeria.

You had spoken about some key projects in certain states where IDB is playing some roles. Can you expatiate on them?

The focus of the bank is economic and social development of the member countries. But before you benefit as a member country, you have to apply. Just as any other bank will not come to you and say ‘come and take loan.’ It’s based on your need that you will apply. Since becoming member and the advocacy that has followed some of the 36 states (in Nigeria) have applied. IDB relates with countries on the basis of sovereignty.

Although, it has affiliates that takes care of private sector interest. IDB deals with the federal, state and local governments. A number of facilities were granted and prominent among them is the ones given to the federal government of Nigeria. At the time of president Obasanjo, there was this food crisis. One of the approaches agreed by the Nigerian government was to work with multilateral agencies; African Development Bank, World Bank, European Investment bank and similar ones that were interested in supporting Nigeria including the Islamic Development Bank. A project called food security was established. It is basically to support food production.

The states applied to get loan from the World Bank, some European banks and the Islamic Development Bank. The states that the federal government approved to access the IDB facilities are Gombe, Yobe, and Anambra states. It was mainly to do with food production; agro allied and anything that will improve the activities of the farmer such as access roads, research institutions, and development of small earth dams, irrigation facilities and warehousing.

These state governments came up with their own project concepts based on their needs and the initial estimate was $50 million for the first phase of the project for the three states. It was after thorough review that the project which takes about 5 years, was reduced to $38 million made available. The states and federal government will also contribute by way of counterpart funding. Then, the figure will become higher.

Kaduna state, when the Vice president was the governor, came up with the Zaria water works which is under construction. The African Development Bank and IDB have interest in it. And also science model schools in each of the three senatorial zones as well as comprehensive health centre are to be built in Kaduna. Facilities were approved for these projects.

The federal government had to come in and also the national assembly for a final clearance. At the moment, it is at the national assembly to get the final clearance for the loans.

We also have Jigawa rural integration project as it is one of the poorest states in Nigeria. IDB is all out to give assistance. Osun and Oyo states, last years, made submissions. That is being worked on now by the bank. There are a number of other states that are talking to IDB.

IDB is planning a business forum in Nigeria next month. What is the bank up to in this direction?

It is normal to inform the general public about the presence of the IDB and its activities. The forum is a form of enlightenment campaign, showcasing IDB as a group. Given the transformation agenda of the federal government there is a prominent role for the private sector. To that extent there is need to ensure that the private sector is adequately involved. The forum is to further enlighten Nigerians on the activities of the IDB and its affiliates especially on how to access its facilities.

Islamic banking recently took off in Nigeria. Given the opposition it is facing especially from the leadership of the Christian Association of Nigeria (CAN), do you think the bank has got prospects of survival?

I think more of an abandoned prospect for the project. If you can recall, the minister of finance and coordinating minister of the economy, Mrs. Ngozi Okonjo-Iweala, when she appeared before the senate committee, this question was asked. She said Islamic banking in Nigeria is another window of banking. That it is quite beneficial. It is not only in Nigeria but even in developed economies.

In the UK, there is the Islamic banking window, also in the United States, Germany, and France. Like the minister said, it is another window of banking allowing some unbanked people to be in cooperated into the sector. Many people because of their belief had refused to participate in banking in Nigeria. This is an opportunity to get them in. Any money that is in the bank is available for the development of the economy.

There is a CBN guideline that states there shall be no discrimination against a beneficiary on the basis of culture, race, religion, language and even in employment, it doesn’t discriminate. That is why there are Christians who are shareholders of the Islamic bank in Nigeria. It is on the basis of this that I feel there is good prospect for the bank.

Is Nigeria rated high at the bank?

Out of the 56 members of the IDB, 27 are from the African continent. Nigerian being a member of OPEC, other members in the gulf region and North Africa also members of the OPEC have been relating with Nigeria before we became member. The membership of Nigeria improved the bank’s assistance to Africa. It will be a voice that once heard will be taken seriously. It is like with Nigeria now, the influence of Africa has gone up at the bank and if you have that influence, then you can also channel the available resources to support the members. The bank has special fund for the development of Africa. It was started in 2008.

I remember the President of IDB, Dr Ahmed Muhammed when I had a meeting with him, what he told me. He said whatever we can do to improve on the position of Africa, in Africa, we will do so. In the course of my discussion with him, he told me that I reminded him of his encounter with the late Nigerian head of state, General Murtala Muhammed in Jedda (Saudi Arabia). They went to market the bank to him for Nigeria to become a member. He said Murtala told him that, ‘ yes, it is a good idea, good concept but Nigeria will only be ready to join if it is in a position to influence the activities of the bank in a way that will aid the development of Africa.’

The special fund for the development of Africa is to mainly focus on the development of the continent. Under the first phase, the Bank has a budget of $12billion; $4 billion directly from the bank and $8 billion from the development partners. Due to the rating of the IDB, any project it is identified in, it attracts the participation of other partners.

Egypt May Sell Foreign-Currency Sukuk, Deposit Certificates

Jan. 18 (Bloomberg) — Egypt may issue an Islamic bond or alternatively certificates of deposit in foreign currency for Egyptians abroad, the finance minister said.

“We are studying issuing sukuk,” or Islamic bonds, Mumtaz el-Saeed said today by telephone in Cairo. “We are comparing the benefits of issuing certificates of deposit with those of sukuk for Egyptians abroad,” adding that his preference is for the certificates. The government hopes to issue one or the other during the current fiscal year ending June 30, he said.

Egypt is struggling to recover from a year of unrest in the wake of the uprising that ousted President Hosni Mubarak last February. The economy grew 1.8 percent in the last fiscal year, the slowest pace in at least a decade, as income from tourism and foreign investment dried up. Tourist arrivals fell 33 percent in 2011, while international reserves are at the lowest level since March 2005.

The government formally requested a $3.2 billion loan from the International Monetary Fund on Jan. 16. An agreement is expected “within weeks,” Fayza Aboulnaga, minister of planning and international cooperation, told reporters.

Egypt turned down a similar arrangement with the fund in June, with officials saying they didn’t want to burden future governments with debt. Foreign currency reserves dropped 32 percent in the following six months while yields on all treasury-bill maturities rose this quarter to the highest since Bloomberg started tracking the data in 2006.

‘Sound Fundamentals’

El-Saeed said today the government would prefer not to increase the amount it requested from the IMF.

The economy “despite its solid and sound fundamentals,” faces challenges that have to be addressed by an economic program that safeguards stability and “creates conditions for a strong recovery,” the IMF’s mission said in an e-mailed statement today.

A program drafted by the Egyptian authorities is being discussed “with emerging political parties to ensure broad political support,” the IMF said. The mission met with the economic committee of the Muslim Brotherhood’s Freedom and Justice Party, and also talked to members of other parties and with the civilian body advising the ruling military council, it said.

The Brotherhood’s party gained the most votes in elections for the lower house of parliament, which is due to convene on Jan. 23, two days before the anniversary of the start of the uprising that led to the ouster of Mubarak. It is still unclear what authority the assembly may have. Activists have called for mass rallies on Jan. 25 to call on the country’s ruling generals to hand over power to civilians immediately.

‘Historic Transition’

The IMF’s meetings this week “provided us with a cross- section of views about Egypt’s current economic and political situation, and possible avenues to address the challenges facing the economy,”the fund said. “It also gave us an opportunity to explain the role the IMF could play in support of Egypt’s historic transition.”

New award for ADCB Islamic Banking

ADCB Islamic Banking was named the “Most Improved Islamic Bank in the UAE” by the Global Islamic Finance Awards (GIFA) committee at a recent ceremony in Muscat.

Keynote speaker Abdullah Badawi, former prime minister of Malaysia at the Oman Islamic Economic Forum (OIEF), presented the award to ADCB Islamic Banking.

Amr Al-Menhali, head of ADCB Islamic Banking, said the award recognizes the ADCB’s leading position and its success in raising the benchmark for Islamic banking in the region.

ADCB Islamic Banking offers a complete suite of Shariah-compliant products specifically designed to cater to the needs of consumers that are key to the health of the UAE economy.

This recognition is subsequent to the milestone ADCB Islamic Banking has achieved, which was acknowledged by the reputed worldwide Shariah governing body in an appreciation letter positioning ADCB Islamic Banking as a role model for Islamic Banks worldwide, said Al-Menhali.

The OIEF assembles a diverse number of financial practitioners, academicians, business leaders and policy makers in the industry.

The forum addressed issues including the regulatory challenges facing Islamic banking, the practice of socially responsible Islamic finance and the need for utilization of Islamic banking as a tool for global economic reform.

The forum, endorsed by the Fatwa office of the Ministry of Awqaf and Religious Affairs, has received support from an array of leading financial institutions from the GCC, Canada, UK, Luxembourg and Malaysia.

Oman Islamic Economic Forum

Muscat, Dec 16 (ONA) – Sayyid Shihab bin Tariq al-Said, will sponsor tomorrow  (Saturday) at al Bustan Palace Hotel the Oman Islamic Economic Forum (OIEF) organized by Amjad Company and lasts for two days.

The OIEF seeks to highlight the steps needed by the Sultanate to develop its Islamic finance sector and Takaful, the elements related to social responsibility in the elements of the Islamic economy.

It also seeks to provide proposals to form a regulatory framework for the Islamic finance sector which in turn will contribute to boosting the growth of the economy in the Sultanate.

The forum will cover a number of themes on the models for regularizing the Islamic banking sector, selecting the best right Islamic banking model for the Sultanate, Islamic banking as practiced by the Islamic banks,

structuring of the Islamic banking products, Sharia issues in banks and Islamic financial, horizons of (Takaful) at the AGCC countries, Arab Islamic market, the role of Zakat, Awqaf and alms in building an alternative Islamic  economic system and the Islamic banks as a mean for Economic reform.

The OIEF will bring together a number of stakeholders – financial practitioners, academicians, business leaders and key decision makers- from within and outside the Sultanate.

The Forum is an ideal opportunity to have an idea about some major personalities and institutions in the Sultanate and establish fruitful long term business relations.

ADIB wealth management seminar presents range of investment opportunities

Dhabi Islamic Bank (ADIB), a top-tier Islamic financial institution, hosted its first Wealth Management Seminar for high net worth customers and presented its outlook on global markets.

The seminar provided customers with the knowledge to understand diverse investment options and make effective investment decisions in a rapidly changing environment.

During the seminar, ADIB revealed the results of its customer survey on investor attitudes towards risk which shows that the proportion of ADIB customers who have an enhanced appetite for risk remains low,

while conservative investor numbers have grown continuously and balanced investors with a moderate appetite for risk remains the largest group.

Stuart Crocker, Global Head of Private Banking Group at ADIB said: “UHNW individuals have a unique and individual approach to risk. Significant changes in the global economy have impacted investor attitudes and this is clearly evident in the decline of enhanced risk taking investors and the growth of conservative to balanced investors.

ADIB has responded to this customer trend by announcing a range of capital protected investment instruments.” The seminar was held at the ADIB Headquarters in Abu Dhabi and hosted a well renowned speaker, Mazin Baghdadi, Deputy Head of Mutual Funds at HSBC Saudi Arabia.

He presented updates on local and regional markets as well as reports on the worldwide economic outlook and the unfolding situation in the Eurozone. ADIB presented its views on the various financial instruments that have increased in appeal in today’s investment environment. ADIB offers a complete range of Shari’a compliant investment solutions customised to the needs and risk tolerance of customers.

As part of ADIB’s strategy to update and educate clients, the bank regularly hosts seminars to help clients make the right financial decisions.

Bank Islam eyes M&As in Indonesia and Bangladesh

KUALA LUMPUR: Bank Islam Malaysia Bhd is eyeing opportunities for expansion in Indonesia and Bangladesh, which have sizeable Muslim populations and adequate Islamic banking regulatory policy and supporting infrastructure for syariah-based financing and banking operations.

Managing director Datuk Seri Zukri Samat said as mergers and acquisitions (M&As) were on Bank Islam’s agenda for growth, the bank was on the lookout for suitable candidates but had not initiated any discussions.

While the two countries had been identified as “very interesting” that fit into the bank’s expansion plan, Zukri, however, said that such plans would have to take into consideration the global economic situation and its effect on this region.

“Some economists believe that there could be a double dip with Europe going into recession and growth in Asia decelerating. We are monitoring the situation and because of that, we are adopting a cautious approach towards our agenda.

“Nonetheless, there are always opportunities in a crisis – acquisition may occur when a shareholder wants to exit – and as long as there are synergies and the pricing is right, the opportunity arises,” he told Bernama in an interview.

Zukri said both countries had sound economies which offered opportunities for Islamic banking, and the presence of many Indonesian and Bangladeshi workers in Malaysia also allowed the bank to tap the lucrative remittance business. — Bernama

Int’l Bank of Azerbaijan ready to apply to Central Bank for permission to start Islamic banking operations

Baku, Fineko/ The consultants drawn by the International Bank of Azerbaijan for Islamic banking development are completing their work.

IBA Islamic banking group’s head Behnam Gurbanzadeh says that the consultants are finalizing a report on the work.

“Immediately after receiving the report it will be submitted to the IBA Board to apply then to the Central Bank of Azerbaijan for permission to start Islamic banking operations,” Gurbanzadeh said.

He added that the first phase of the project has been finished. Within its framework the consultants evaluated the Islamic banking tools to be applied without changing the current legislation of Azerbaijan.

“The consultants proposed a new model for the Azerbaijani financial market to enable to increase the flow of liquid funds into the country, raise investments and open good markets for further financing of small and medium business,” the group’s head said.

The consultants estimated about 50 Islamic banking instruments, oriented primarily to the corporate sector.

“Within the first stage of the Islamic banking project the legislation allows introduction of about 6 Islamic instruments without changing the legal regulation, if the Central Bank of Azerbaijan is not against and gives us permission to conduct such operations.

In the future, on the basis of practice of applying the first 6 products, we will work on the second stage of the project, within which a legislative change initiative can be proposed. Today we want to show that this is a working model, bringing harm neither from economic nor social point of view, and then to begin the main part of the project,” Gurbanzadeh said.

The project consultants are Salans, KPMG, Pinsent Masons and Dar al Shariah.