DIEDC: UAE Agreements with Turkmenistan Opens New Opportunities in Islamic Economy

DIEDC: UAE Agreements with Turkmenistan Opens New Opportunities in Islamic Economy

Such a basic idea was expressed by the Emirati financial media, commenting on the recent signing of the Memorandum of Understanding between the Dubai Islamic Economics Development Center and the State Bank for Foreign Economic Affairs of Turkmenistan.

The memorandum was signed during the visit of the governmental conference of Turkmenistan led by President Berdimuhamedov to the UAE on March 15th, 2018. The document was signed by Sultan bin Saeed Al Mansuri, UAE Economy Minister and Chairman of the Dubai Islamic Economics Development Center (DIEDC) and Rahimberdi Jepbarov, Chairman of the Turkmenistan Foreign Economic Bank (TFEB), and confirmed intention to share information, experience and best practices in the Islamic economy.

As indicated on the official website of the Government of Dubai, a Memorandum of Understanding aimed at establishing channels between the two countries in the field of Islamic banking and finance, as well as sharing experiences in the halal industry.

In particular, DIEDC, in partnership with TFEB, organizes seminars and training courses and shares professional knowledge in research and development. In addition, both sides have created a joint system to oversee cooperation in the research and knowledge sectors that support the development of the Islamic economic system.

Commenting on the signing of the Memorandum of Understanding, Sultan Bin Said Al Mansouri said: “The UAE and Turkmenistan have been developing successful economic cooperation for a decade, especially in the oil and gas and energy sectors. The partnership between DIEDC and TFEB will further strengthen the synergy between these two countries and open the door for new cooperation in sustainable investments in the Islamic economy, especially in the financial sector – an essential component of Turkmenistan’s long-term development plans.”

He noted the potential of the halal sector to stimulate investment between the UAE and Turkmenistan. In addition, he noted that sukuk (in the Islamic financial market this is a share in the allocated tangible assets or a funded project) is one of the main instruments in financing infrastructure, education and health projects, as well as in other vital spheres in accordance with the efforts of the two countries to promote the achievement of the United Nations sustainable development goals.

The Minister of Economy also said that the Islamic economy has proved its value in preserving and even expanding the sources of wealth, and its principles are consistent with the policy of food and energy security. He noted that the Memorandum will facilitate the exchange of experience in the halal sector, the expansion of trade in halal products that meet the requirements for health and safety in both Muslim and non-Muslim points of view.

For his part, Foreign Economic Bank’s Chairman Rahimberdi Jepbarov said: “Bilateral relations between the UAE and Turkmenistan continue to deepen and flourish, because we see great support from our colleagues from the Emirates. Dubai’s efforts to preserve the favorable ecosystem and its positive steps to standardize the Halal rules successfully strengthened their position as the global capital of the Islamic economy and gained international trust. Based on the existing cooperation in the field of renewable energy sources, we again joined forces to expand partnerships in mutually beneficial areas for both countries.”

As the Secretary-General of the DIEDC, Essa Kazim, said: “Our partnership with relevant organizations around the world contributes to the development of an investment culture based on ethical Islamic principles, increases awareness of Islamic financial products and creates an integrated ecosystem that guarantees equitable development.”

He also added that TFEB’s interest in sukuk reflects the growing international authority of the instrument, which is largely achieved through the attraction of sukuk to finance government projects, allowing it to contribute to economic diversification.

DIEDC Director-General Abdullah Mohamed Al-Awar emphasized the role of the partnership with TFEB in promoting the principles of Islamic finance and reaffirmed the UAE’s desire to share its successful experience of diversifying the economy in the post-oil era and the growing interest in investing in productive sectors that contribute to the achievement of sustainable development.

With regard to the halal sector, for Turkmenistan, which has focused on realizing its agricultural, industrial and commercial opportunities, while conserving natural resources, sharing experiences in this field of research will facilitate cooperation and investment, and will serve as a basis for launching new initiatives and programs.

The international significance of using sukuk increases: the market of Islamic finance annually grows by an average of 15-20%. In 2014, the debut issues of sovereign sukuk took place in Hong Kong, Senegal, South Africa, Luxembourg and the UK. To date, the leaders in the issue of sukuk are Malaysia and the Persian Gulf countries.

As part of the work on the development of “green finance”, Kazakhstan together with the European Bank for Reconstruction and Development plans in 2018 to issue sovereign state Islamic securities sukuk in the amount of up to $ 300 million.