Japan, the country of lowest interest rate and third largest national economy of the world, has big potential to get better financial positioning in international and regional financial markets by virtue of Islamic Banking and finance which is a missing component of Japanese financial industry.
This was stated by renowned Islamic financial expert Zubair Mughal, the Chief Executive officer, AlHuda Center of Islamic Banking and Economics while addressing Japan Halal Forum in Tokyo.
He mentioned, Islamic finance is now not only confined to Muslim world but non-Muslim countries are also equally benefitting from it, as we have very good examples of USA, South Africa, U.K and many other non-Muslim countries, therefore, Japan have a good proposition to expand its financial Mix by entering this niche market which will not only develop financial and economic activities within the country through different unique feature of Islamic Banking and Finance products but also help out to increase their financial ties with other regional financial centers i.e Malaysia, Indonesia, Singapore etc and expand financial vision to Muslim world especially oil rich Muslim states i.e. UAE, Qatar, KSA etc. which will assist to diversified the product mix of Japanese financial industry.
He mentioned that to enter into Islamic financial market is not a new phenomena for Japan financial industry as some of the Japanese Banking and financial companies are already providing Islamic Banking and Takaful ( Islamic Insurance ) services in Malaysia, Middle east and some other countries, even Japan also have experience to issue the Sukuk after the amendment in financial regulatory regime for the facilitation of Islamic financial products which was highly appreciated in international financial industry. Asian Largest Stock Exchange (Tokyo Stock Exchange) can also attract new investor base through Islamic indices and Sukuk listing which would be another milestone for the Japanese Economy.
He revealed some beneficial facts about beneficial use of Islamic Finance in Japan, as Islamic Banking and Finance products are primarily based on trade based modes which creates real economic activities, in the result the expected returns will be very good and creates the jobs, entrepreneurship and other business advancements which will definitely develop more returns/profits comparatively low interest rate benchmark of Japanese banking market. He also mentioned that Islamic Banking and Finance also develop Halal industry in Japan which will supplement Halal food export, attract millions of new tourist through Halal Tourism concept and other develop other allied services in Japanese market.
Originally published on www.nation.com.pk