The G20 has become the most globally accepted space in economic and financial affairs, incorporating the highest political level in their Summits and giving a firm step towards the democratization of the international economic affairs management.
Its agenda is composed of three major elements, with direct consequences for every economy in the world: The consolidation of a sustainable growth of the economy and a global re-balancing, the reform of the international financial architecture and the reform of the international financial regulatory system.
Within this institution, that brings together the world´s major economies, there are three Muslim countries. The first one is Indonesia; the state with the largest Muslim population in the world and an important member of the ASEAN. The second country is Saudi Arabia; the world oil market regulator. The third is Turkey; a hinge between the Asian and European continents.
After the international financial crisis, the inability of the financial regulatory system was evidenced and the measures that should be implemented to recover the belief that the system could work in a smooth and stable way were discussed within the group.
However, unlike the collapse of the banking giants that were considered “Too large to fall”, the Islamic banks and funds outperformed the financial crisis without big loss.
In this respect, the positive feedback of the Islamic finance from various corners of the world, during the crisis, could be interpreted as a vote for the confidence in the Islamic financial industry.
Economists believe that the current global financial crisis is set to create a “New International Economic Order” and to restructure the global economic institutions.
Given the fact that three developing Muslim-led countries are among the top 20 economies, they should encourage Islamic finance to exploit existing opportunities and demonstrate its worth by offering momentous alternatives to the international economic community.
In the last meeting of the Islamic Development Bank, that brings together the representatives from Islamic banks and invest funds, Indonesia, Turkey and Saudi Arabia expressed they will follow a joint strategy within the G20 in order to boost not just economic growth, but also the formation of a more fair society based on the Islamic values.
According to the finance minister of Indonesia, “The three countries have common values due to their Islamic population”. The minister stated that “different ways of high risk speculation, considered co-responsible of the outbreak of the crisis, are forbidden by the Sharia”, affirming that “it is a mechanism incorporated to minimize the risk”.
It sounds ironic that to rescue capitalism from its last crisis and restore the system stability, the solutions should come from the Islamic economic base. But like after the Second World War, when many of the social claims stated by socialism forced capitalism to give an answer under the form of the Welfare State, today the financial Islamism may force capitalism into a new model, more focused on people and in the real economy.
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