The Islamic action plan
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The emirate’s ability to build an Islamic economy will depend on its success in bringing together the fragmented sharia-compliant sectors Dubai’s ability to develop an Islamic economy will depend on how successful it will be in bringing together the fragmented sharia-compliant, halal and Muslim-friendly sectors, both domestically and across the globe. Cooperation with other Islamic hubs is a major factor that will need to be addressed during the creation of a cohesive Islamic economy. In Islamic finance, Dubai will need to keep up with developments in Islamic financial centres in the UK and Malaysia. Globally, the growing amount of Islamic financial assets is encouraging, as are efforts in creating new products. But the market is still dominated by conventional banking and finance. If Dubai wants to change that, it will need to lead innovation and harmonisation to help the sector evolve. That includes the furthering of underlying frameworks. One of the most pressing issues is the establishment of Islamic standards and a legal framework that leaves no room for confusion. While regulatory bodies do exist, there is not much trickle-down to the actual markets. On a national level, that could be addressed by creating specific departments or experts dedicated to Islamic industries. The UAE government’s plans to establish a national sharia board to oversee corporate boards is the first step towards this goal. Beyond that, the creation of standards could have an impact on the regional market and become international benchmarks. For companies operating in halal production, it is also about credibility. Presenting a halal choice to Muslim consumers will not automatically mean they will choose it over a conventional product. They will need to be able to trust the brand is truly halal and that the product is of comparable quality. All these elements will require much time and effort to develop. If Dubai manages to pull that off, significant opportunities could arise to tap into a growing global trend. 7.11.2013