The United Kingdom is seeking support from the central bank and other regulators to develop Islamic finance in the country,particularly in Mindanao.
Aaron Chan, economic advisor at the British Embassy in Manila, said besides its involvement in the peace process in Mindanao, the UK is also pursuing trade and investment in the region.
“The fact that we are working slowly but steadily toward approaching peace and stability in Mindanao, that needs to be followed by economic investment. One of the ways that we think we can be of help in providing opportunities is by encouraging the growth of Islamic finance in Mindanao,” Chan said in a press briefing on Wednesday.
Islamic finance is based on the elements of Sharia or the law of Islam, which governs Islamic societies. The concept of Islamic finance is that money has no intrinsic value and should only be used as measure of worth and medium of exchange.
Chan said UK is generally bullish about Philippine prospects for Islamic finance, but one of the biggest hurdles in the market is the fact that the different Sharia boards or regulatory agents in the country are fragmented.
“In this case, the way to promote this market is to encourage a more cohesive regulatory framework,” he said.
In this regard, Chan said the UK is working with the National Commission on Muslim Filipinos on financial regulation to promote the welfare and livelihood of Muslim Filipinos.
“Right now, we are helping them finalizing their working draft on the policy work map toward regulating Islamic finance products in the Philippines,” he said.
“So mainly, we are working actively with the Commission, but we’re also reaching out to the Bangko Sentral ng Pilipinas. We are doing that by hosting a roundtable discussion with the BSP. The people from the Commission can present their working draft so that BSP can see where the gaps are,” he explained.
Finally, Chan said the challenge is to bring people together to identify specific ways to develop Islamic finance in the country.