Dubai outlines plans to unify legal framework for Islamic finance
The chief executive of Dubai Islamic Economy Development Centre outlined the phases for the development of a unified legal framework for Islamic finance during a meeting to discuss Dubai’s contribution to the Islamic economy.
Abdulla Al Awar said that once complete, the project would bring “much anticipated standardisation to the Islamic finance sector, reduce discrepancies in practices across the globe, and eventually translate into positive outcomes for the Islamic economy as a whole”, Dubai Media Office said.
The DIEDC is working with the Islamic Development Bank on standardisation and the two parties signed an agreement last month. The DIEDC had previously signed an agreement with the Accounting and Auditing Organisation for Islamic Financial Institutions for the use of its standards as a reference point in building the international legal framework.
The Sharia-compliant segment of Dubai’s economy contributed Dh41.8 billion to the emirate’s gross domestic product in 2018, a 2.2 per cent year-on-year increase, as Dubai continues to pursue its goal of becoming the top Islamic economy hub in the world.
The Islamic economy accounted for 9.9 per cent of total GDP in 2018, Dubai Media Office said, quoting data issued by Dubai Statistics Centre.
Of that, Dh17.9bn (43 per cent) came from the retail and wholesale sector, Dh10.7bn (26 per cent) from the financial sector, Dh7bn (17 per cent) from the hospitality and food and beverage sectors, and Dh6.2bn (14 per cent) from the manufacturing sector.
Dubai, the Middle East’s commercial hub, hopes to drive economic activity through Sharia-compliant segments to boost its GDP and position the emirate as a significant player in the fast-growing global Islamic economy.