Interview of Ines Wouters, Lawyer at Afschrift, Belgium, Member of ISFIN
Islamic Shari’ah Investment in Belgium – An introduction
How do you see the development of investments emerging from Islamic countries in Belgium ?
Investment from Islamic countries in Belgium is at the moment at a rather low scale. It is certainly very beneficial to develop shariah compatible products to attract investments from Islamic countries, for Muslim population but also for non Muslim population. Civil law principles and Christian background in Belgium create a favorable background which needs to be developed. We also have in Belgium a rather large Muslim population which can play a significant role in this senses.
How could Belgium’ s government develop a Sharia’h friendly legal environment to attract Islamic investors ?What are the regulatory issues and perspectives ?
At present Belgium legal and tax background allows the development of some Sharia’h compatible products without any change in the law and the tax system. Such products are to be developed in accordance with our specific legal and tax particularities. This is the role of local jurists with the help of sharia’h scholars. However the Ministry of Finance has already committed himself to work to create a more friendly environment but has not pin pointed yet any particular point to be dealt with.
What are Belgium’s main challenges to enable proper development of Islamic finance there ?
Clearly the main obstacle is psychological. There is still some misunderstanding to be cleared. Some financial institutions are reluctant to start as they anticipate a negative reactions from their traditional clients. This is in my opinion rather temporary and misunderstandings need to be cleared.
Many corporations/companies in Belgium are anticipating investments in Arab and Islamic countries. What would you recommend them to do business/invest in the Islamic world ?
To have a better knowledge of Islamic world and particularly a good understanding of Sharia’h principles.
How have you structured the Islamic Finance team in your firm ?
We have a small team, working for Muslim and non Muslim clients. As it is always in our firm we work closely with our clients and develop products according to their needs.
What are the main advantages of Sharia’h accredited investments, mechanisms and transactions ?
Transparency, stability, simplicity, asset or service backed.
What would you recommend to Islamic investors willing to carry operations in Belgium ?
There are two aspects. One is to address the needs of Muslim population which is very demanding for Sharia’h compatible products. A middle class is starting to take roots in Belgium and the needs for business investment, housing etc, is developing quickly. The other aspect is the information aspects with traditional Belgian population to understand the principles and the mecanisms of Islamic finance. The current financial crisis will make people more open to alternative source of financing.
It is important to show that Sharia’h compatible products can be helpful for all, Muslim and non Muslim. It can also be a new source of funding and a new way of thinking the finance and the economy.