By Blake Goud | Islamic Finance Gateway (IFG)
The goal of the Dubai Islamic Economy Development Center (DIEDC) is to make Dubai a reference point for the Islamic economy, said Abdulla AlAwar, the center’s CEO. The Islamic economy initiative, which was launched at the direction of Sheikh Mohammed bin Rashid Al Maktoum at the beginning of 2013, aims to diversify Dubai’s economy and make the emirate the capital of the global Islamic economy.
At an IFG focus session last week, AlAwar described a few initiatives planned for the seven pillars of the Islamic economy which include:
• Islamic finance: Launching the Dubai Global Sukuk Center to position Dubai as the leading destination of sukuk;
• Halal industry: Make Dubai the trusted solutions provider for the production, supply, certification and standards for halal products;
• Tourism: To expand Dubai as a destination for halal and family-friendly tourism;
• Digital Islamic economy: Provide entrepreneurs with incubator offerings to develop the Islamic economy;
• Lifestyle: Promote Islamic art, design and fashion;
• Information and knowledge: Launch training programs (e.g. the Dubai-based City University of London MBA program in Islamic finance) to find and develop talent in the Islamic economy including supporting academic research in the Islamic economy to be a reference point for information on the Islamic economy; and,
• Standards & certification: Develop Islamic economy standards across the other six standards.
In response to a question about the role the DIEDC expects for SMEs, AlAwar said they hoped financial institutions would be proactive in supporting the sector. In particular, because the share of Islamic banks’ assets in the UAE was at 25% and was expected to double based on estimates compiled by Ernst & Young, Islamic financial institutions would have a key role. He said they would work alongside the DIEDC under a DIEDC initiative which will focus on programs to support SMEs. Some of these programs are in collaboration with Dubai SME and Dubai Silicon Oasis.
After a question about standardization, AlAwar highlighted the challenge to meet consumer expectations that is driven by different interpretations for implementation. Standards setting bodies should focus on minimum uniform standards to allow for non-material areas of differences in opinion. The DIEDC is already engaged with the Emirates Authority for Standards & Metrology and the Dubai Accreditation Department in halal standards development to become a reference point as a trade hub as well as in standards setting through further work with the OIC.
Private sector involvement in the process is ‘crucial’ according to AlAwar, although the DIEDC is primarily involved with working with Dubai government entities like the Free Zones. The private sector can participate by promoting the Islamic economy and developing products and services that are sharia-compliant. Local companies have already become involved, like Al Islami Foods, which is working with the authorities in Dubai to implement the standards and was also involved with other companies at the Global Islamic Economy Summit (GIES) last November.
In response to a question about whether the Islamic economy initiatives represented a shift towards a more top-down approach to sharia governance, AlAwar explained that it was not a shift, but another way to enhance the economy of Dubai. Within the diversified economic ecosystem of Dubai, the initiatives would add sharia-compliant activities to be part of that broader ecosystem as well as developing unified standards that could be applied on the ground in the UAE. Some of the developments of Dubai as a transshipment point for halal food will benefit countries where there is limited availability of halal food. Dubai’s standards will ensure integrity through the entire production and distribution process.
More information about the Dubai Islamic Economy Development Center can be found on its website at www.iedcdubai.ae/.