Abdulla Mohammed Al Awar for The National
At a time when the IMF describes the global economy as entering “secular stagnation” because of a decline in investments and an ageing population, the Islamic economy stands in stark contrast offering an increasingly viable elixir for stimulating global economic growth and success in the 21st century.
Today, on the first day of the Global Islamic Economy Summit, we see that throughout the world, Muslims are becoming increasingly active as investors and manufacturers, bankers and traders, competitors and suppliers are emerging as real partners in the global economic system.
The fast-growing and predominantly young Muslim population of 1.7 billion people represents a major opportunity. This is clearly evidenced in the massive spike in Muslim consumer spending across a variety of sectors. So at a time when many other consumer markets, from New York to Sydney, are reaching saturation point, Muslims offer a new outlet from which to build a base for future growth.
However, although the consumers of the Islamic economy are primarily Muslims, there are others who share similar values who are increasingly being attracted to the Islamic economy’s underlying socially-conscious ethos, embodied in Halal food, modest fashion and family-friendly tourism.
The demand also extends to business practices that seek ethical finance, investment and insurance services. Any company that is not considering how to serve this value-driven market is missing a significant opportunity to impact positively its top and bottom line growth.
As the purchasing power of Muslims increases, the Islamic economy is creating value for consumers and the economies involved. Within the OIC, concerted effort is being made to develop intra-OIC trade, which is further facilitating the development of the Islamic economy sectors. And as the OIC countries become more and more integrated with the global economy, as suppliers and consumers, as well as providers and seekers of foreign investments, global interconnectedness is making it easier for developed economies and multinationals to seek out new growth markets.
In the next 10 to 15 years, the world will undergo fundamental change. Disruptive technologies, such as the Internet of Things, driverless cars, next-generation robots and 3D printing, will all have a dramatic impact on how we do business and interact with each other. At the forefront of this economic and social revolution will be young people, constantly innovating, asking how can this be done differently, or how it can be made better. With a population growing twice as fast as the global population, the Muslim world is poised to take centre stage in this new “new economy”. The question is no longer: “What is the Islamic economy?” It is: “How can we best benefit from it?” The answer to that question may well be found at the Global Islamic Economy Summit.
The Islamic economy has the potential not only to drive national economic growth but also to help heal the wounds that have left millions of people across the world disillusioned and seeking a better way of doing business. True, the Islamic economy is not without its own challenges, including job creation, training and education. But the combination of a young consumer market, an entrepreneurship engine driving innovation and wealth creation and synergies within and across Islamic economy sectors, is creating opportunities that are building an unstoppable momentum.
At a time when some respected economists say we are on the brink of a new global recession, triggered by events in the euro zone, uncertainly over the Chinese economy, mass migration and bearish equity markets, the Islamic economy could prove to be a knight in shining armour for struggling economies.
Abdulla Mohammed Al Awar is the chief executive of Dubai Islamic Economy Development Centre.