Sultan Nazrin Muizzuddin Shah
IPOH: Sultan of Perak Sultan Nazrin Muizzuddin Shah urged the people, particularly political leaders, to stop racial or religious provocations.
He said it was important for both sides of the political divide to tone down racially-tinged vitriol that had been apparent recently.
“After 62 years of independence, the voices of racial and religious hatred have been played out verbally lately.
“The post-14th General Election political temperature is increasingly heated, and this is due to things being done by people from both sides; those who lost and those who won.
“What victory do these leaders want by competing against each other’s ego in their quest for influence and political support?
“What satisfaction will they gain if there is bloodshed or if bodies are scattered while building and vehicles are destroyed by fire?
“It is compulsory for us to tone down such temperatures,” said Sultan Nazrin at the state-level Maal Hijrah celebration at Casuarina@Meru Hotel here yesterday.
He said racial and religious provocations were like ticking time bombs.
While citing past cases, in which mosques and Hindu temples were desecrated and Prophet Muhammad was insulted, Sultan Nazrin said these acts were done by people who wanted to gain something.
“Be aware of it! The splinters from such time bombs do not discriminate their victims. In fact, the grandchildren and family members of those who install such time bombs are also exposed to the consequences of these shallow minds.”
He said whenever provocations occurred, the facts and validity of the news were not important as people’s emotions would get the better of them.
He said emotions clouded the judgment of even the well-educated, and that was why such provocation must never be allowed to continue.
He said when dealing with such cases, the law must be upheld to protect the people’s safety, property and the innocent.
He said other recent issues, such as an item in the school curriculum, disciplinary action against a student and the wrong way of flying the Jalur Gemilang, had been interpreted through racial and religious lenses.
“This is not healthy as it puts the country in danger. A majority of our citizens love peace, but they are getting worried and scared.”
Sultan Nazrin presented the state Maal Hijrah Icon award to former Perak syariah chief judge Datuk Muhamad Asri Abdullah, who received RM10,000, a medal, plaque, a certificate and an umrah package worth
Muslim Welfare Organisation of Malaysia permanent chairman Datuk Dr Abu Bakar Shaari was named the recipient of the Ar-Ridzuan Special Award, which also came with a prize of RM10,000, a plaque, a certificate and an umrah package worth RM7,000.
In Alor Star, Sultan of Kedah Sultan Sallehuddin Sultan Badlishah attended the state-level Maal Hijrah celebration at Wisma Darul Aman here.
He reminded people not to be selfish and not to disregard the country’s peace and harmony.
“We have only one country. This is where we live, work and go about our daily lives in peace. Don’t be selfish to the point that we allow the country to be destroyed by irresponsible people.
“These approaches must be embraced by all sides because it is for the betterment of the country, especially as it is key to enhancing the image of Islam as a religion that will remain relevant throughout the ages.”
He urged people to embrace maqasid syariah (primary goals of syariah) and Rahmatan LilAlamin (blessings for the whole world) for the betterment of society and the country.
Present were Sultanah of Kedah Sultanah Maliha Tengku Ariff and Menteri Besar Datuk Seri Mukhriz Mahathir.
The imam of Masjid Kampung Pokok Asam in Sungai Petani, Abdullah Yahaya, received the state Maal Hijrah Icon award. He also received RM15,000, a certificate and other gifts.
In Kuala Terengganu, Sultan of Terengganu Sultan Mizan Zainal Abidin attended the state-level Maal Hijrah celebration at the Kuala Terengganu State Stadium here.
Present were Sultanah of Terengganu Sultanah Nur Zahirah, Yang di-Pertuan Muda Terengganu Tengku Muhammad Ismail, Tengku Setia Mahkota Raja Tengku Muhammad Mua’az and Tengku Puteri Daulath Raja Tengku Fatimatuz Zahra’.
Also present were Menteri Besar Datuk Seri Dr Ahmad Samsuri Mokhtar and his wife, Datin Seri Tuan Faizah Tuan Ab Rahman.
Sultan Mizan presented the state-level Maal Hijrah Icon award to Pas president Datuk Seri Abdul Hadi Awang, who received RM10,000, an umrah package worth RM10,000, clothing worth RM500, a trophy and a certificate.
In Kuantan, the Maal Hijrah celebration was held on a moderate scale at the Sultan Haji Ahmad Shah Broadcasting Complex here. It was attended by more than 1,000 people.
Regent of Pahang Tengku Hassanal Ibrahim Alam Shah Al-Sultan Abdullah, who launched the event, presented the Pahang Maal Hijrah award to five recipients.
Present were Menteri Besar Datuk Seri Wan Rosdy Wan Ismail and State Mufti Datuk Seri Dr Abdul Rahman Osman.
We have only one country. This is where we live, work and go about our daily lives in peace. Don’t be selfish to the point that we allow the country to be destroyed by irresponsible people. SULTAN SALLEHUDDIN SULTAN BADLISHAH, Sultan of Kedah
Published in: The New Straits Times, Monday 2 September 2019
The following is the royal address by the Sultan of Perak, Sultan Nazrin Shah at the 2nd Malaysia-China Youth Civilizational Dialogue on Islam and Confucianism in conjunction with the 45th anniversary of Malaysia-China diplomatic relations.
I AM delighted to join all of you at this conference. Although it is organised by the old members of two well-known universities of Malaysia and China — the International Islamic University Malaysia and Peking University — today’s event is in fact directed for the benefit of our next generation, the youths of Malaysia and China.
Furthermore, this civilisational dialogue celebrates the 45th anniversary of the bilateral relations between our two countries.
We are here today to reflect on the contributions of two distinct, major spiritual traditions, Islam and Confucianism, to ethics in the 21st century.
May I commend the two alumni associations most sincerely on their selection of a conference theme which foregrounds — indeed, celebrates — the potential for dialogue and collaboration between different religions, cultures, and communities.
It seems to me that we are, in many ways, ideally situated for such a conference today. Geographically speaking, I am proud that Malaysia is vibrantly multicultural, a fitting location for a dialogue between different religions and sets of beliefs.
Indeed, with its majority Muslim and substantial minority Chinese population — comprising about 61 per cent and 25 per cent respectively — Malaysia is essentially a living, national example of this cultural exchange in action.
In Malaysia, Muslim and Chinese citizens — the latter with a centuries-old heritage of Confucian philosophy — exist side-by-side, living and working together with others from a wide variety of ethnic backgrounds and creeds.
In this sense, the conference is taking place in the ideal setting for an intellectual collaboration between Islam and Confucianism.
It is my sincere hope that Malaysia will represent the harmonious relationship between these two great traditions for many years, decades, and centuries to come.
A less peaceful world
Yet today’s conference is ideally situated not only geographically speaking, but also, I believe, in time. We are living in an increasingly conflicted and divided world.
According to the Global Peace Index — a measure of international harmony published by the leading think tank, the Institute for Economics and Peace — our world today is less peaceful than it was 10 years ago.
One need only skim the newspapers or tune in for the news headlines to be convinced of such a claim. Countries across the globe are experiencing violence fuelled by intolerance, and a hatred of racial, cultural, and religious difference.
Now more than ever, we need international, intercultural, and civilisational dialogues: we need — to return to a favoured image of mine — to build bridges, both within and between countries throughout the world.
Now, it is fair to say that there is much bridge-building work already being done, not least by international organisations such as the United Nations.
A prime example, in our current century, is the UN’s “Alliance of Civilizations” initiative, which began in 2005.
This was established largely in defiance of Samuel Huntington’s controversial “Clash of Civilisations” thesis, which proposed that the Islamic world, China, and other non-Western powers would join forces in a conflict against the West.
The “Alliance of Civilisations”, in response, sought to forge international, intercultural, and interreligious cooperation, particularly between the Western and Islamic worlds.
The “Alliance” was fully supported by the Organisation of Islamic Cooperation — an organisation which, notably, is patron to the International Islamic University Malaysia — and the OIC’s support, in itself, demonstrates the enormous potential and will of Islam to spread peace and build bridges throughout the globe.
However, the historic cultural and political dominance of the West has meant that, for decades and even centuries, the focus of international bridge-building has been between the West and other countries and cultures, as with the “Alliance of Civilizations” project.
This, in turn, means that the equally important bridges that should — and indeed do — exist between eastern civilisations have often been sidelined or overlooked.
We are, I believe, on the brink of a major shifting or widening out of focus.
History less Western-dominated
As exemplified by the work of the Oxford historian, Peter Frankopan, especially in his recent book The New Silk Roads, the spotlight of world history is presently on the move, becoming less Western dominated and Eurocentric, and more interested in the countries and cultures of the East.
As such, this conference could hardly be more timely. Today, we have come together to consider Islam not alongside the cultures and beliefs of the West, but instead alongside one of the oldest spiritual traditions of the East.
This is an intercultural dialogue which many — including the renowned Chinese Harvard scholar, Professor Tu Weiming — believe holds great promise for the future wellbeing of humanity as a whole.
I must say that I, too, feel greatly optimistic about this dialogue, and its potential to make a truly positive contribution to ethics in the 21st century.
I have indicated already that we are inhabiting a world in crisis, and thus, today’s conference is brilliantly poised to explore how Islam and Confucianism can help us to overcome these major global challenges.
On the face of it, there is much that seems strikingly different about Islam and Confucianism. Confucianism is one of the world’s oldest spiritual traditions, beginning in China in around 500 BC, with the teachings of the Chinese philosopher Confucius.
By contrast, Islam is a relatively young world religion, founded more than 1,000 thousand years after the death of Confucius, by the Prophet Muhammad sallallahu ‘alayhi wassalam, in the 7th century.
In addition to their founding dates, another major contrast between Islam and Confucianism is the extent to which they can be considered religions.
As the distinguished Chinese philosopher, Professor Chung-ying Cheng, rather boldly puts it, whereas Islam is an organised religion, Confucianism may be thought of as an “unorganised non-religion”.
Now it goes without saying that, for some adherents of Confucianism, this is clearly not the case — and indeed, there has even been a Holy Confucian Church established in China in recent years.
But it is certainly true that, whereas Islam is unquestionably a leading monotheistic world religion, Confucianism’s religious identity is less definite.
And this brings me to a final, apparent point of difference: that of size. Islam today has around 1.8 billion followers, making up just under a quarter of the world’s population.
By contrast, while the numbers are more difficult to estimate, it is thought that less than 1 per cent of people worldwide are followers of Confucianism today.
However, these figures fail to tell the full story. While a relatively small number of people might identify as “Confucian”, Confucianism’s cultural reach is far broader. It is estimated to have some form of influence over the lives of more than 1.6 billion individuals — or 18 per cent of the world’s population — living predominantly in China, as well as in the Korean peninsula, Japan, and in Southeast Asian countries like Malaysia.
Thus, Islam and Confucianism are in fact similar in that they both influence the lives of billions of individuals worldwide.
Both are, moreover, experiencing what we might think of as a period of flourishing at present. Research by the Pew Centre in the US shows that Islam is by far the world’s fastest growing religion.
Although perhaps on a smaller scale, meanwhile, Confucianism is currently witnessing what many in the scholarly community are calling a “revival”, not least in China.
Resurgence of religion and spirituality
Indeed, the predictions of many 19th and 20th century philosophers, particularly in the West, of the decline of religion, have
been starkly contradicted by the trends in both Confucianism and Islam today.
Far from “Gott ist tot” — the “Death of God”, to invoke Nietzsche’s famous phrase — what we are witnessing today is a resurgence of religion and spirituality, and I believe that it is hardly any surprise. In troubled times such as those through which we are living, humanity cries out for faith, for guidance, and for the sense of community that can be found in shared beliefs.
For all their seeming theological differences, a major area of convergence between Islam and Confucianism is that they both see religion as inseparable from politics and ethics.
This was a point made numerous times at the first conference of its kind on Islam and Confucianism, hosted by the University of Malaya’s “Centre for Civilisational Dialogue” a little over 20 years ago.
At this conference, for example, Professor Tu Weiming spoke of how “the inseparability between political leadership and moral authority” is an idea “shared by the two traditions”. He described how both traditions draw a direct line between the “healing and development of one’s own spiritual body” and the “serving” of the “body politic”, and suggested that “a spiritual leader is also a political authority” in Confucianism and Islam, in terms of providing the “standard of inspiration” for the people, and for the nation.
In other words, both Islam and Confucianism would propose a spiritual, not a secular approach to handling even those crises which are often viewed as being beyond the remit of religion, such as economics or climate change.
With this in mind, I would like to spend what remains of my speech sharing some preliminary reflections on the ways in which Islam and Confucianism might contribute productively to the global ethical tradition today. Many of the themes and ideas I touch on will no doubt be explored at greater length and in greater depth in other papers throughout the conference’s two days.
I would first like to suggest some of the ways in which I see Islam and Confucianism interacting with a global issue very close to my heart: that of climate change. We are now in the midst of what many are calling a “climate emergency” — a “climate emergency” has indeed been declared in countries such as Canada and the United Kingdom.
The global temperature is rising at an unprecedented rate due to the emission of greenhouse gases, generated particularly by the burning of fossil fuels.
This in turn means melting ice caps and rising sea levels; climate scientists, for instance, estimate that most central and eastern Himalayan glaciers will have disappeared entirely by 2035.
Climate change, along with human activities such as deforestation, is also having a devastating effect on biodiversity, with the World Wildlife Fund (WWF) estimating that the rate of species extinction is at least 1,000 times higher than the natural extinction rate — that is, the rate without human-induced damage to the planet.
With last month, July 2019, confirmed as the hottest month on record, and with some leading climate scientists estimating that we have as little as 18 months to take action before the damage becomes irreparable, our world is in now desperate need of a new ethical imperative.
When we turn to the teachings of Islam and Confucianism, we find that both endow their followers with a grave responsibility to take care of the planet and its creatures. According to Islam, mankind is God’s khalifah – His representative or “vicegerent” on Earth – enjoined to protect and oversee His creation.
A similar notion of humankind’s stewardship of the planet, and of our close relationship with it, was articulated by a leading student of Confucius, who said: “Heaven, the Earth, and humans are the basis of all creatures. Heaven gives them birth, the Earth nourishes them, and humans bring them to completion”.
What I find particularly compelling about this philosophy, beyond the idea of human responsibility for the Earth, is the sense it conveys of all things on the planet being inextricably linked. Indeed, this Confucian teaching is echoed by classical Muslim philosophers such as the great Ibn Khaldun, who taught that: “All created things are subject to a regular and orderly system. Causes are linked to effects where each is connected with the other and any change will affect one another in a pattern that is both remarkable and endless.”
For too long, humans have thought only about themselves, without realising that if we do not nurture the Earth, the Earth will not nurture us. Only now is the stark and terrible reality of that fact beginning to sink in, with a report by the Intergovernmental Panel on Climate Change only two weeks ago declaring that climate change is reducing the Earth’s ability to sustain human life. These gems of Confucian and Islamic wisdom I shared a moment ago thus offer an urgently needed reminder: we all exist in a symbiotic relationship with the planet, and we all must take better care of it now, before it stops taking care of us.
Ethics of environmental sustainability
In both Islam and Confucianism, then, we find the basis for an ethics of environmental sustainability. Indeed, I have spoken in the past about the striking overlap between the teachings of Islam and the United Nations’ Sustainable Development Goals or SDGs. For instance, where the Qur’an emphasizes the centrality of water to life, pronouncing that “We made every living thing from water”, SDG numbers 6 and 14 are both concerned with access to clean water, and with protecting the planet’s oceans and seas.
We need not look hard to find a crossover between the SDGs and Confucianism, either. Take, for example, SDG number 12, which stresses the importance of “Responsible Consumption and Production”. Is this not what is also being emphasized in the phrase, attributed to Confucius, from the "Book of Rites": “To fell a single tree or kill a single animal, not at the proper season, is contrary to filial piety”?
Our planet is in urgent need of the ethical approach advocated by both Islam and Confucianism, an approach which reminds us of humankind’s responsibility for and dependence on the Earth. I see this as a vital contribution to be made by the two great spiritual traditions to global ethics in the 21st century.
Alleviation of poverty
Another area which I would like to touch upon briefly is the potential of Islam and Confucianism to help alleviate global poverty. While extreme poverty has fallen since the 20th century according to World Bank statistics, around 10 percent of the global population, or some 780 million individuals, still subsist on less than US$1.90 per day.
The rate of poverty alleviation, moreover, is slowing. In both Islam and Confucianism, we find a spiritual imperative to share wealth, to support those in need, and to value social good above financial gain. A well-known Confucian saying, for instance, declares that “the superior man thinks of virtue”, while “the inferior man thinks of profit”.
In Islam, meanwhile, zakat or almsgiving is one of the Five Pillars of the faith. Charitable giving is not simply something which Muslims are encouraged to do; it is absolutely integral to an Islamic way of life. In seeking to build a world in which wealth is shared more equitably, in which people value giving more than keeping and acquiring, we may look to these spiritual traditions as a source of ethical guidance.
Ethics of tolerance
Perhaps the single biggest contribution to be made by Islam and Confucianism to ethics in this century, however, lies in their mutual promotion of tolerance, genuine acceptance, and community. In both traditions, there is enshrined an imperative towards understanding and harmony, which can undoubtedly support those productive conversations between nations and peoples that need to take place today.
It is no coincidence that Islam and Confucianism have a long history of being in respectful, productive dialogue with one another. Just as the two traditions coexist in Malaysia and in many other countries today, so they have lived alongside one another for many centuries, particularly in China.
As far back as the 13th century, there was a Muslim governor in the Yuan Court of Kublai Khan, alongside many Confucian advisers. In the 17th century, arguably China’s most famous Muslim scholar, Wang Daiyu, produced a number of celebrated Islamic writings in Chinese, using concepts drawn from Confucianism to articulate and explain Islamic theology.
There is a long and peaceful history of trade between the Muslim Malay Sultanates and the Confucian Ming dynasty; exemplified best with the voyages of Admiral Cheng Ho. The two traditions – Confucianism and Islam – have enjoyed centuries of mutual exchange, collaboration, and harmonious dialogue. This is in part because, as we have seen, despite their many differences, the two traditions also share some major points of convergence and similarity. Their single most important similarity is their shared belief in showing tolerance and genuine acceptance towards others.
In an increasingly divided and conflicted world, both Confucianism and Islam encourage us, as humans, to recognize our likeness to others, and to respect – rather than to mistrust or reject – any differences. An important Qur’anic verse reads, “O mankind! Indeed, we have created you from a single man and a single woman, and made you into races and tribes so that you should recognise one another.”
We are enjoined to reach out to the other, to find points of contact even in our seeming differences. In a phrase which shares much of this sentiment, meanwhile, a famous Confucian saying declares, “By nature men are alike. Through practice, they have become far apart”. Both spiritual traditions offer to the 21st century much-needed ethics of bridge-building, of establishing a truly global community in which we can recognize that we are, after all, more similar than different and that any differences are to be celebrated, not feared. It seems entirely fitting that this bridge-building ethos should be borne out not only by a singular religion, but by two major global belief systems and philosophies placed in dialogue with one another.
Today, China – the birthplace of Confucianism – is home to a sizeable minority of Muslims. As well as bordering Southeast Asia, a region with a significant Islamic population, China has, moreover, political, economic, and cultural relationships with Muslim nations throughout the world.
At the same time, there are many ethnic Chinese – the majority of whom have been influenced by Confucianism – living as citizens in numerous Muslim-majority countries in Southeast Asia, most notably Malaysia and Indonesia. How the two cultures and traditions interact will, therefore, have far-reaching consequences, not only for the future of Southeast Asia, but for peace and prosperity on a global scale. For all of these reasons, I believe it is timely that we all reflect on Islam and Confucianism, and the contributions they make to the ethical tradition in this new century.
In concluding, then, I would like to wish you all a productive and enriching time at this two-day conference. It is my firm belief that our planet has much to gain and learn from a collaborative dialogue between Confucianism and Islam, just as the two traditions have much to gain and learn from one another.
As the 18th century Chinese Muslim scholar, Jin Tianzhu, wrote: “Those who study only Muslim books and neglect Confucian writings cannot possibly comprehend the Truth, and vice versa. One should know both things”. And, in this spirit of seeking out the “Truth” – what Muslims call “haqiqa” – there is the popular saying from the Hadith for our Muslim-Sino dialogue, in which Prophet Muhammad sallallahu ‘alayhi wassalam encourages us to “seek knowledge even unto China!”
Another famous Hadith, meanwhile, declares, “Wisdom is the lost property of the believer, let him claim it wherever he finds it”. It is my profound hope that, in providing a platform for sharing and seeking out wisdom today, this conference might itself contribute to ethics for the 21st century, in order to steer and guide our world through the many challenges to come.
Published in: The New Straits Times, Thursday 22 August 2019
The following is the keynote address of Sultan of Perak Sultan Nazrin Muizzuddin Shah at the 5th World Conference on Islamic Thought and Civilisation (WCIT) at Casuarina@Meru, Ipoh, Perak, yesterday.
BISMILLAHI r-Rahmani r-Rahim. Assalamu‘alaykum warahmatullahiWabarakatuh.
Your Excellencies, distinguished scholars, ladies and gentlemen,
It gives me great pleasure to welcome you all to this, the 5th World Conference on Islamic Thought and Civilisation. As ever, I am most delighted to be here to address you all today, at this conference hosted by the university which bears the name of my dear father, the 34th Sultan of Perak, Al-Marhum Sultan Azlan Shah. It is truly an institution which is very dear to my heart, and, returning here for another of these prestigious, international conferences, I am heartened — indeed, proud — to see Jami’ah Azlaniyah, this Islamic university, continue to flourish and thrive in an increasingly global context.
As the WCIT takes place for a fifth time, I must laud the efforts of the organisers on their selection of a theme which is, at once, positive, proactive and cautionary.
This conference gathers together some of the world’s finest thinkers, speakers and scholars, to reflect on the important challenge of “Securing the Future”, and to share ideas about practical strategies for doing so. For, the phrase “Securing the Future” reminds us that the future is, indisputably, not yet secure. The world is beset with many burgeoning crises. Global warming and pollution pose a very real and imminent threat to the planet, not only to plant and animal life, but ultimately to human existence.
Poverty and financial instability continue to devastate the lives of many people the world over, with more than 780 million individuals globally subsisting on less than US$1.90 (RM4.03) per day. Almost every day in the news we hear of discord between nations and peoples, such that, according to the data collected by the World Economic Forum, someone is displaced every three seconds, driven from their home because of war or persecution. As of the end of 2016, the number of people displaced by conflict worldwide was greater than the population of the entire United Kingdom. Indeed, from all of these perspectives, the future seems far from secure.
I am especially heartened to note, therefore, that through its many excellent sub-themes, including “Learners Today, Leaders Tomorrow”, “Economy Matters” and “Cultural Language of Religion”, this conference sets out to address a variety of serious global challenges for the future in discursive and proactive ways. I want to touch upon a number of these related topics this morning, and I am delighted that we can also look forward to papers by eminent researchers from a wide variety of countries, fields and academic institutions, which will explore these themes in greater depth and detail.
Ladies and gentlemen,
Although I have opened on a serious note, I come here today with a message of hope and positivity, a call for action. I come here to tell you, to urge you to believe that “the future is ours”.
The future is ours to safeguard and shape, and ours, I hope, to enjoy. “The future is ours.” It is a short, seemingly simple assertion, and yet one which invites a number of questions — not least, what do I mean by “ours”? To whom, am I suggesting, does the future belong?
As a Muslim, I say that “the future is ours” in that I believe Islam has much to offer the world when it comes to tackling some of the biggest challenges of the future for mankind, particularly in economic and environmental terms. I have spoken in the past about the ways in which Islamic finance could play a vital role in addressing issues of poverty and financial instability on a larger, global scale. It is widely acknowledged, for instance, that Islamic banks generally fared much better during the financial crisis of 2007-2008, demonstrating greater resilience than non-Islamic banks, according to a report by the International Monetary Fund. This, surely, is a sign that Islamic finance models could contribute greatly to the global banking sector as a whole, providing stability and security in the face of future economic uncertainty.
As well as offering the hope of future economic stability, Islamic finance may also hold some of the answers when it comes to addressing the serious problem of widespread poverty. Through the social finance institutions of zakat, waqf and sadaqah, Islam enshrines charitable giving at its core, and there is no doubt that these mechanisms could be better mobilised to provide poor-relief to a greater number of individuals, both Muslims and non-Muslims, worldwide.
We should also note, moreover, the huge potential of sukuk bonds to generate wealth for the common good and for all people.
Although sukuk are Syariah-compliant investments, a number of Socially Responsible Investment or SRI sukuk have been developed in recent years which are designed to raise money to fund socially beneficial projects for everybody. Take, for example, Gavi, the Vaccine Alliance, which launched the first international sukuk intended for a charitable purpose in 2014, raising US$500 million in its first year to help fund immunisation programmes in some of the world’s poorest countries. I am delighted, also, to be able to mention the Khazanah sukuk as an example of an SRI sukuk, which helps to fund schools and education right here in Malaysia. I sincerely hope that more sukuk may be used to such socially responsible ends in the future, and as sukuk issuance continues to increase, spreading to new markets such as the United Kingdom and South Africa, it seems that this hope could very well be realised. Sukuk bonds are emerging as a viable, popular and ethical investment option, and this is a contribution which Islam can make to the future of the economy and to human welfare, on a truly global scale.
This discussion of sukuk, moreover, leads me into another area in which I believe Islam has an important role to play in securing the future of the planet: that of protecting and preserving the natural environment. As well as SRI sukuk bonds, recent years have also witnessed the inception of the so-called “green” sukuk,
and I am very pleased to be able to say that Malaysia has been an innovator, promoting bid’ah hasanah, in this respect. Just last year, in 2017, Malaysia launched the world’s first ever Green sukuk as a collaboration between Malaysia’s Central Bank and Securities Commission, together with the World Bank. The proceeds from this sukuk will finance environmentally beneficial projects such as the development of renewable energy sources here in Malaysia.
But, there is much more still to be done when it comes to tackling the ever-growing problem of climate change. This conforms to Islam’s philosophy of the Adamic man’s mandate as God’s khalifah, to act as stewards of the planet.
Allah subhanahu wa-ta‘ala reminds us of our God-given honour in the Quran with the words, “We appointed you as stewards (khalifah) in the earth — so that We might see how you behave!”
With this God-given honour, we are entrusted also with a grave responsibility.
At present, humanity is damaging, not nurturing the planet, and this ultimately means damaging the future. Carbon dioxide pollution, generated particularly by the burning of fossil fuels, has resulted in rapidly rising global temperatures, leading to the melting of glaciers and ice caps, and to dramatic rises in sea levels.
To give a tangible sense of the rate at which this crisis is developing, researchers predict that most central and eastern Himalayan glaciers will have entirely disappeared by 2035. This is a stark indication of the speed with which we must act if we are to address the escalating problem of global warming. Climate change and human activities such as deforestation are also having a devastating effect on the earth’s biodiversity, leading to the extinction of the other living creatures with which we share this planet. According to the World Wildlife Fund, the rate of species extinction is somewhere between 1,000 and 10,000 times higher than the natural extinction rate. The preventable loss of a species is truly a loss for our future. It is a God-given duty of Muslims to strive to reverse or, at the very least, to halt this environmental damage. The future of the planet is our divine responsibility.
When I say that “the future is ours”, however, I do not speak only as a Muslim. I speak also as a human, as a citizen of the world, as belonging to that Adamic family: for I believe that the future belongs to each and every one of us, irrespective of our religion, our race, and even our nationality.
Indeed, if we are to take on the major challenges like climate change, which pose a serious and imminent threat to our future, we must think and work beyond our modern borders and identity boundaries, and we must also, moreover, empower each and every individual to feel that their actions can make a difference.
The former First Lady of the United States of America, Eleanor Roosevelt, once wrote in an inspirational phrase, that “the future belongs to those who believe in the beauty of their dreams”, and although it might sound like something of a cliché, it is a notion that I would like all of us to hold on to today. The future belongs to those who believe that they have the power to shape it, to effect real, decisive change, and to have their voices heard.
Ladies and gentlemen,
We have just witnessed our 14th general election two months ago here, where the citizens of Malaysia, the voters, brought about substantial, even unprecedented political transformation through the ballot box. From this defining moment in our country’s relatively young history, I do hope that the citizens of Malaysia feel empowered to make their mark, and to influence their nation’s future.
As I stressed a little over a decade ago, “Malaysians of all races, religions and geographic locations need to believe beyond a shadow of a doubt that they have a place under the Malaysian sun”. It will require what our ulama call both tajdid as well as islah, to breathe new life into and to rejuvenate our institutions, and where necessary to improve upon them.
There is no denying, however, that there will be “growing pains” in our journey to make Malaysia a mature democracy to join the rest of the community of nations already in that Premier League of democracies, so to speak. That is why I believe that we should not leave anyone behind in this process, including those with whom we may disagree. We must avoid the unhealthy practice made in some countries where, following an important victory, “the winner takes all”. Everyone under the Malaysian sun should be part of this journey, and we should be mindful to involve all of the nation’s stakeholders in this historic journey.
Ladies and gentlemen,
I have spoken at this conference several times in the past about the vital importance of investing in and empowering the world’s youth. Young people, after all, really do represent our planet’s future. To reiterate a hugely pertinent quotation which I cited two years ago, by the director of the United Nations Population Fund, “Young people are the innovators, creators, builders and leaders of the future. But, they can transform the future only if they have skills, health, decision-making and real choices in life”. Of course, investment in education and healthcare is absolutely vital, as I have emphasised in the past, but it is this notion of involving young people in decision-making and empowering them to feel that they do have “real choices in life” which I wish to dwell on before closing. We often talk about young people being the leaders and policymakers of tomorrow, but I suggest that we also need to do more to make young people feel actively consulted and engaged in decision-making today. Indeed, there are numerous case studies which demonstrate that mobilising youth populations, for example, in national peace building and community cohesion projects can be hugely effective, significantly improving the overall success of such efforts. Following the end of the Nepalese civil war a little over a decade ago, the thorough involvement of young people in peace consultations resulted in an 80 per cent reduction in violent protests. Meanwhile, earlier this year, UNESCO reaffirmed its commitment to continue and to reinforce its work with young people in community development in South Sudan, ensuring, “that their voices are not only heard, but that they actually become drivers of change in their respective communities”.
At the same time, there is also evidence to suggest that when young people feel disempowered, disaffected and ignored, they will inevitably seek to bring about change in other, less constructive, collaborative, democratic and even peaceful ways. Analysis of the Arab Spring of 2011 has suggested that youth unemployment was one of the underlying causes of the uprising, with unemployment rates at almost 30 per cent in Tunisia, where the protests began. Notably, reports indicate that jobs were high on the demand lists of these early protestors. What is especially tragic about this fact is that, despite youth unemployment being a root cause and driver of the uprising, very little has changed in the aftermath of these events in the Arab world. Indeed, World Bank statistics indicate that youth unemployment rates are actually even higher now than they were in 2010-11. The message, it seems, is only too clear.
When young people are consulted and actively involved in political and diplomatic processes, they can help to effect change which is significant, peaceful and positive for all. When young people feel overlooked and disenfranchised, the routes they may take in their attempts to get their voices heard can actually result in a worsening of their already compromised situation.
In Malaysia, it would seem, but also around the world, we need to do more to enable young people to “become drivers of change”, to empower them to believe that the future really is theirs to influence and build. As leaders, scholars, and people with a platform, we need not only to champion those issues which we believe matter to today’s youth, but also to invite young people to speak and to be heard, to share their ideas in their own words, within democratic and diplomatic forums, and not outside of them. To underline the vital importance of this, I would emphasise that young people currently make up nearly half of the world’s population: as of 2017, 42 per cent of the global population was under the age of 25, and that number is set to grow. We must, I think, do more to engage these many millions of people in shaping their tomorrow, today.
Ladies and gentlemen,
My thoughts today have not shied away from the many difficult challenges facing our world in the future. Youth disempowerment, financial uncertainty, political turmoil, global warming: these are just some of the serious issues which we must address, and quickly, indeed, if our world is to have a future at all. But my message is ultimately, I hope, one of optimism. It will undoubtedly take the efforts of us all, young and old, men and women, of every faith, nationality, race and creed, to secure our planet’s future. The future is our collective responsibility; and, if we take up that responsibility now, the future will also, I believe, be our reward, in this life and in the next.
Published in: The New Straits Times, Wednesday 18 July 2018
It gives me great pleasure to be here this morning, and to address this gathering of experts and proponents of waqf and Muslim endowments, which is a fascinating subject of real interest and importance to me.
I would like to begin by applauding the Ministry of Higher Education and the University of Malaya on the establishment of a Chair devoted to waqf studies, which draws attention to the many facets of endowments in the Islamic tradition that can be explored and optimised for the advancement of society as a whole.
My hope is that this positive development for waqf in Malaysia will encourage other government ministries, religious authorities, corporate bodies and individuals to consider this social finance instrument as a viable, sustainable funding option for socially beneficial projects, thereby reducing dependency on public funds.
Indeed, I look forward to the day when endowment-funded universities become the norm rather than the exception here in Malaysia, and I hope that the various state Islamic councils and universities can work hand in hand to make this vision a reality.
The general concept of waqf should be familiar to us as a predecessor of modern trusts and endowments. A donor endows a waqf with an asset and, in doing so, makes an irrevocable transfer of that asset, while also stipulating the intended charitable use of the funds it generates.
A waqf institution then spends its revenue in perpetuity on the fulfillment of public needs, according to the wishes and conditions established by the donor.
Once the asset is registered as waqf under Islamic law, it can no longer be inherited, sold or given as a gift. It is placed under three key restrictions: irrevocability, perpetuity and inalienability. In fact, the asset now belongs to the divine Almighty, Allah Subhanahu wa-Ta‘ala (SWT), and remains intact or permanent.
This permanence points to the original sense of the Arabic word for waqf, which literally means “to freeze” or “to stop”; in other words, as the original asset is now “frozen”, only its generated revenue can be channelled to the stipulated beneficiaries.
Although some have argued that the practice of waqf may have existed well before the advent of the Islamic religion, Islam was, in fact, the first religion to develop a comprehensive legal framework that promotes, guides and fosters the development of the institution of endowments and charitable trusts.
In a famous Hadith invoked by the Muslim ulama to legitimise the practice of waqf, the Prophet Muhammad Sallallahu ‘alayhi Wassalam (SAW) said:
“When a human being dies, his or her good deeds also come to an end, save three things (that they leave behind): (first) a perpetual charity (sadaqa jariyah), (second) any beneficial knowledge, and (third) a pious child praying for him or her.”
A notable example of a waqf property is the Well of Sayyidina Uthman Radiyallahu ‘anhu (RA) in Madinah, which was founded in the first year of Hijra during the Prophet’s own lifetime. The famous Well of Uthman originally belonged to someone who was selling water to the poor inhabitants of Madinah at an exorbitant price.
The Prophet SAW promised Paradise to the person who would buy the well and endow it to the residents of that city. Upon hearing this, Sayyidina Uthman at once set out for the owner and purchased the well in two instalments, paying a total sum of 38,000 silver dirham, which was a hefty sum of money at the time. He then registered the well as waqf and allowed everyone, Muslim and non-Muslim, to draw water for free.
Alhamdulillah, this well has remained “intact” to this day, and one can still witness water being pumped from it, albeit now using an electrical motor, to irrigate the surrounding farmlands. Indeed, many date palms and other trees thrive in the area.
Over the years, the authorities in charge of the waqf, the mutawalli, have invested the money received from the sale of farm produce as well as from other investments related to the original endowment. As of 2013, this investment income totalled 50 million Saudi riyal (RM52.24 million). As the enduring example of the Well of Uthman makes evident, waqf undoubtedly stands as one of the greatest contributions of Muslim civilisation.
Throughout the Islamic world, and across many centuries, waqf has led to the completion of magnificent works of architecture, and has allowed vital services — including education and healthcare — to be financed, organised and maintained, to the benefit of hundreds of thousands of individuals, Muslims and non-Muslims alike.
Waqf also provided a means of achieving a more equitable distribution of income and wealth, and of introducing sustainable and inter-generational social investments in society. Some of us today may not realise this, but for every conceivable enterprise for the advancement of public good across the Muslim world historically, there was always a waqf behind it.
Institutions of waqf reached their zenith during the 16th and 17th centuries, at the height of the Ottoman Empire. Indeed, the waqf system became one of the building blocks of the Ottoman economic and social order.
Imperial waqfs established by the Ottoman sultans were some of the largest economic and social institutions of the time, holding vast agricultural land holdings and diverse income-yielding real estates, managing extensive budgets, and providing not only religious services, but social and educational projects too.
In the language of economists, these imperial waqfs also functioned as redistributive institutions. They collected income from different rural regions, and channelled the funds into town economies, redistributing this income through the purchase of food and other goods, the provision of charitable services, the upkeep of buildings, and even through maintaining the salaries of their employees.
As well as contributing to the economic development of the Muslim world, moreover, historians have shown that the law governing waqf was borrowed by Europeans, and by the English, in particular, following the Crusades in the Holy Land (1095-1291), when they became acquainted with Islamic jurisprudence and culture.
A famous example of this — something I was privileged to witnessed during my days at Oxford University — is Merton College, which was established with a financial endowment in 1264. Scholars have argued that the original endowment deed which established the college was based on Islamic law through waqf deeds common at the time.
This endowment has, of course, facilitated centuries of scholarships, learning and teaching, and has safeguarded and fostered the freedom of thought and expression which is so essential to the university system today.
We might draw a parallel with the earlier Nizamiyyah College of Baghdad, founded in 1065; this institution’s independence and self-government, made possible through its waqf endowment, created the intellectual environment which, in turn, produced luminaries of the Muslim world, such as the great Imam al-Ghazali (d. 1111). Indeed, the historical significance of waqf is highlighted by the fact that the founding of Merton College is now generally viewed as a milestone in the evolution of European and Western universities.
In the United States of America, meanwhile, most of the top universities have their own endowments. The Harvard Endowment, which is Harvard University’s largest financial asset, is made up of more than 13,000 individual funds invested as a single entity.
The endowment’s returns have enabled leading financial aid programmes, promoted groundbreaking discoveries in scientific research, and funded hundreds of professorships across a wide range of academic fields.
Distributions from the endowment provide a critical source of funding for Harvard. At the end of the fiscal year of 2017, the endowment paid out US$1.8 billion (RM7.1 billion), contributing over a third of Harvard’s total operating revenue in that year — to put this into perspective, this is larger than the government budget of Afghanistan, Montenegro, and Barbados, for example (figures taken from The World Factbook — Langley: CIA, 2016).
This endowment, which has facilitated so much discovery and learning, is ultimately modelled on the Islamic waqf system.
It is, I believe, a testament to the contribution that the concept of waqf has made to progress and development worldwide, and it also demonstrates the immense potential of the waqf instrument to generate funds for international public good.
Despite these success stories in the East and the West, both today and in the past, the prevailing view is that more could and should be done, to ensure that waqf institutions are managed effectively to achieve broader socio-economic objectives.
In Malaysia today, most of the waqf properties are connected to religious institutions: mosques, madrasas, and cemeteries. Very little of these waqf land generate income for the waqf’s sole authorities, the mutawallis, which are the respective state Islamic councils here in Malaysia (i.e. the Majlis Agama Islam Negeri).
These properties and lands are underdeveloped, and this is due in large part to their location, as much of the waqf land is rural, scattered across large areas, with little potential for development. Current statistics indicate that of Malaysia’s nearly 13 and a half thousand hectares of waqf land, only two per cent of the total area has actually been redeveloped.
In addition to the challenge posed by the location of these waqf lands, the state Islamic councils also face problems in relation to the registration of waqf land titles. In cases where the land was bequeathed many generations ago, the titles for waqf land cannot always be identified. Without these titles, it is almost impossible for these councils to develop the land.
More broadly, waqf is under-utilised as a viable instrument for social economic sustainability simply because of a widespread lack of understanding about its operational structure, and about the applicable, permissible ways of channelling its benefits.
Many stakeholders, as well as members of the general public, remain unaware of the different ways in which the waqf system can be harnessed to generate revenues to be distributed to beneficiaries.
Perhaps the biggest impediment to the development of the waqf system, however, is the perceived poor management of waqf institutions, as a result of limited regulation and supervision mechanisms.
Of the various challenges to the waqf system that I have mentioned, it is this last point which I wish to focus on today, as I believe that strong governance and professionalism are the keys to inspiring public trust in waqf institutions, which will, in turn, generate greater vibrancy within the system, thereby addressing many of the other problems I have outlined already.
I am delighted to observe that the past three decades or so have witnessed the creation of a comprehensive and dynamic ecosystem in the world of Islamic finance.
Yet, while waqf can undoubtedly benefit from this ecosystem, there are peculiar factors relating to waqf which need to be addressed through specific measures. In order to strengthen governance within the waqf infrastructure, and to develop a broader strategy to revive the use of waqf as a platform for Islamic social finance, it may therefore be necessary for the institution of waqf to develop its own formal governance framework.
This framework may include a clear specification of the roles and responsibilities of the waqf trustee and the waqf authority, as well as a code of conduct outlining the need for the trustees to act in good faith, with prudence and fiduciary care, and in the best interest of the donors and beneficiaries.
For this reason, I believe that the internal governance of the waqf authorities must not be neglected, and that there should be adequate internal controls put in place, including risk management protocols and regular audits.
Good governance also involves strengthening engagement with the relevant stakeholders.
Waqf authorities should continuously engage with different stakeholders, while also establishing an effective communication policy to manage these relationships.
In terms of communication with the wider public, meanwhile, I believe transparency is another essential requirement, especially for the environmentally-aware millennial generation, who are the champions of the Environment, Social and Governance (ESG) Criteria that underpin ethical finance.
As the potential founders and donors of years to come, these young people really do represent the future of waqf. We should pay attention to their demand for alternative financial products, and seize this as an opportunity to demonstrate to them and others the true potential of the ESG financial governance mechanisms that have already started to emerge, for example, under the institutions of both zakat (tithes) and waqf.
To establish effective governance, we must further ensure that all waqf governing bodies have the experience and expertise required in this asset-management role. This includes ensuring that waqf authorities possess the necessary understanding of the Islamic principles and laws which govern waqf.
Officers of waqf authorities and their trustees should, therefore, undergo regular training in this area, which would also allow them to remain up-to-date with the latest developments in relevant areas, such as the Islamic finance industry.
To unlock the full potential of waqf assets, meanwhile, the state Islamic councils should also collaborate with the private sector to tap into the latter’s wealth of experience in commercial property development. Such collaboration proved highly beneficial, for instance, in the case of the first commercially-developed waqf land project in Malaysia — the headquarters of Bank Islam Malaysia in Kuala Lumpur.
Implementing and maintaining a robust governance framework for the management of waqf may seem a daunting and onerous undertaking, but it is an absolute imperative if waqf authorities are to gain and reinforce stakeholders’ trust and confidence, thereby ensuring the sustainability of waqf as a key component of Islamic social finance, and of the social economy as a whole.
In this day and age, when noble and benevolent intentions are sometimes given in to our own selfish desires, or even exploited by irresponsible parties, it is more important than ever that the institution of waqf remain unblemished and beyond reproach.
While improving waqf governance is essential, other mechanisms also exist which could help to restore waqf to its former prominence. Indeed, there are examples of some of these already in action.
Take, for instance, the recent call for the revival of idle, immovable waqf assets through the adoption of new innovative contracts of Islamic finance. These contracts, such as Musharakah Mutanaqisah (Diminishing Partnership) and Build-Lease-Transfer arrangements, succeed not only in transferring the idle and unproductive waqf holdings into modern buildings, but also in providing job opportunities for large numbers of people in building and construction projects.
The creation of movable waqf assets — including cash waqf models such as waqf shares, mobile waqf and corporate waqf — is another encouraging recent development. Among other benefits, these cash waqf models have enabled the setting up of clinics and dialysis centres to improve healthcare, and the provision of qard al-hasan, an interest-free loan that is extended by a lender to a borrower at goodwill, to allow the impoverished and needy to begin small businesses.
We must also, of course, consider the ways in which the waqf system can work alongside and complement other instruments of Islamic finance. For instance, Islamic financial institutions, potentially with the support of government, could be more active and creative in developing waqf assets through the issuance of sukuk to increase participation from the public.
In this regard, the Securities Commission Malaysia has already established a regulatory framework to facilitate the issuance of Sustainable and Responsible Investment (SRI) Sukuk. The objective is to spur the growth of the Syariah-compliant SRI Sukuk segment, leveraging on similarities in the underlying principles of the Syariah and SRI.
Of particular relevance to today’s event is the fact that one of the categories eligible for SRI projects under this framework is the development of waqf assets. This should help to unleash the potential of waqf as a mechanism for undertaking Syariah-compliant SRI projects of a significant size. I, therefore, urge Islamic financial institutions and related stakeholders to initiate and enhance existing efforts to issue waqf-based SRI Sukuk as soon as practically possible.
As we seek to develop the waqf system in these times of rapid change and discovery, we must finally consider how financial technology, or digital finance, might be harnessed to enhance the efficiency of waqf collection and distribution. Waqf may be calculated and monitored using smart apps, for example, that present funding options to donors based on their personal preferences.
Indeed, portals and apps have already been created to collect cash waqf, such as through crowdfunding schemes, and to finance small businesses through qard al-hasan. The advent of blockchain technology provides another means by which donors can monitor waqf donations and ensure that beneficiaries receive what has been allocated to them.
In this age of ever-increasing connectivity, technology can also be used to link donors in wealthy Muslim nations to those in need in poverty-stricken or conflict-torn areas, in a more structured and transparent manner.
The possibilities presented by the connection of billions of people worldwide, through mobile devices with unprecedented processing power, storage capacity and access to knowledge, really are unlimited. Technological advances are being made every day, and emerging breakthroughs in fields, such as artificial intelligence, robotics, the Internet of Things, nanotechnology and biotechnology will, no doubt, further enhance the potential of the waqf system in ways that we cannot imagine today.
However, our laws and regulations, along with our innovative products and methods, cannot alone guarantee the effective revival of the institutions of waqf. The success of all that I have mentioned also requires a “softer” element, upon which the long-term sustainability and viability of waqf ultimately depends.
That softer element is trust or amanah. Trust can only be established through the actions of responsible individuals and the financial community collectively. More must, therefore, be done through public awareness and educational programmes, to enlighten donors, trustees, beneficiaries and all other stakeholders of the waqf ecosystem, as to the measures and actions that will be necessary if we are to fulfil the true purpose of waqf and ensure its long-term sustainability.
The importance of Islamic social finance is increasingly being recognised on an international level, with waqf, zakat and sukuk all seen as financial tools that could help to improve our quality of life, and sustain the welfare and wellbeing of humankind in the world today.
Given the significant potential for waqf to contribute to humanity in this way, it is essential that its stakeholders worldwide now work to coordinate and collaborate across national boundaries, in the orderly development of the waqf ecosystem.
In this context, and given its global leadership in the Islamic finance industry, Malaysia has not just the opportunity, but also the responsibility to act as an example that other countries may emulate, and to pave the way for this internationally essential development.
Published in: The New Straits Times, Friday 23 February 2018
The following is the keynote address by the Sultan of Perak Sultan Nazrin Muizzuddin Shah at the conference yesterday at Mandarin Oriental, Kuala Lumpur.
BISMILLAHI r-Rahmani r-Rahim. Assalamualaikum Warahmatullahi Wabarakatuh.
It is my great pleasure to be here at such a prestigious international event to discuss crucial questions about the future of the Islamic economy. Embedded within this economy is the concept of halal. As those of you gathered here today will know, halal refers to that which is permissible or lawful according to Islamic law. As such, the concept and practice of halal should be omnipresent in the end-to- end ecosystem of both production and consumption within the Islamic tradition. The halal industry has, therefore, always been of paramount importance to Malaysia as a Muslim-majority country. Indeed, I would like to take this opportunity to encourage the ongoing work of the Halal Industry Development Corporation (or HDC) in Malaysia, which has implemented various initiatives since its foundation in 2006, with the aim not only of furthering the development of the halal industry locally, but also, I hope, of fostering its ecosystem beyond Malaysia.
There are approximately 1.84 billion Muslims in the world today, making up around 24.4 per cent of the world’s population, or just under one quarter of humankind. By 2030, this number is expected to increase to 2.2 billion. It is important to recognise, however, that although Islam is one religion, the Muslim community is not one homogenous group. The worldwide Islamic community is spread over 200 countries, with an estimated one fifth of the world’s Muslim population living in non-Muslim- majority countries. Muslims throughout the globe are citizens of their respective countries, but they also have a sense of belonging to the ummah, the worldwide Muslim community.
The growing Muslim population worldwide translates into a rising international demand for halal products. Halal is now a truly global industry, and this ever-increasing globalisation represents an exciting opportunity for the Islamic economy, to grow more prominent within the world economy as a whole. However, it also presents a number of challenges, to do with international attitudes and rapid technological change; and it entails important responsibilities concerning the ethical governance of the halal industry and its proper regulation worldwide. I will be considering these aspects of the burgeoning global halal industry in my speech today.
These are, indeed, exciting times for the global halal economy. The value of the halal industry is growing at a remarkable rate: from approximately US$2.3 trillion (RM8.89 trillion) in 2012, the halal sector is expected to almost triple, to US$ 6.4 trillion by this year. This is an astonishing growth within a period of just six years, and represents a major success for the global halal industry. In Malaysia, there have been a number of concerted efforts and programmes, most notably, the formulation of the Halal Industry Blueprint for 2008-2020, to propel the international growth of the industry, and to make Malaysia a global leader in innovation and production.
While halal is perhaps most often associated with food and drink, there are in fact a wide range of halal products and services which can be offered, including healthcare and pharmaceuticals, personal care and cosmetics, travel and tourism, and financial services. According to Reuters, by the end of 2018, the halal food industry alone will be worth USS 1.6 trillion, the halal cosmetics industry will be worth USS 39 billion, and the halal pharmaceuticals industry will be worth US$ 97 billion. It is projected that the halal food and drink sector may be worth as much as US$ 2.1 trillion by 2030.
This vast and widespread growth is due to the increasing demand for halal alternatives across a variety of retail sectors, particularly in parts of the world with a rapidly growing Muslim population. The halal market is not only thriving in Muslim-majority countries, but also in major non-Muslim- majority economies, including China, Japan, the US and the UK. In the United Kingdom, for instance, food production companies are increasingly recognising the importance of the Muslim market, with around 20 per cent of sheep meat in England being consumed by the Muslim population. More and more companies are therefore catering to the Muslim market by producing halal food items. Indeed, one of Malaysia’s Department for Halal Industries has been collaborating with local councils in the North East of England to develop a business hub for producing halal meat. This is an excellent example of the way in which building bridges and establishing global links can help to foster the development of the halal industry worldwide.
There is also an increasing international awareness of the importance of halal tourism, with travel agents offering halal holiday packages. Halal tourism is thriving across Europe, to the extent that Spain even hosted the inaugural Halal Tourism Conference in 2014, and will also be hosting the Halal Expo conference, on food, tourism and lifestyle, later this year.
As these facts and figures attest, recent years have witnessed the rapid international growth of the halal industry across a variety of sectors, and this growth is predicted to continue. Countries are increasingly catering to Muslims at home, as well as appealing to Islamic tourists and holiday-makers overseas. There is a growing realisation, it seems, that halal is a way of life, and that businesses need to meet the needs and demands of Muslim consumers. In this way, the halal industry is propelling the growth of the Islamic economy on an international level.
Despite these success stories, however, the industry must address some significant challenges if this encouraging trend is to continue.
First and foremost, we must acknowledge that halal continues to face some opposition in non-Muslim majority countries. While many non-Muslims are also choosing halal products for their business and personal needs, recent years have witnessed the rise of what we might call “halal phobia” in certain countries. In December 2017, for instance, a French supermarket supplying halal products was ordered to close for not selling pork or alcohol. This kind of reactionary behaviour could potentially damage the globalisation of the halal industry.
I spoke several years ago at the Saïd Business School in Oxford University, about the role and importance of branding in relation to halal products. While we should be proud of the proliferation of Islamic brands in global markets, we must also ask ourselves to what extent we want to segment markets along identity and religious lines. Pushing Islamic brands too aggressively may affect the marketability of products in non-Muslim communities, and will almost inevitably invite reactions from other religious groups. There is, it seems, a delicate balancing act to be performed, between ensuring the availability of halal products and services to Muslims worldwide, and encouraging non-Muslims to see halal products as viable options for themselves as well.
Another potential challenge to the internationalisation of the halal industry is the so-called “Fourth Industrial Revolution”, or Industry 4.0. Rapid and unprecedented technological advances are currently transforming economies, jobs, and even civilisation itself. We must recognize that the world is changing. Billions of people are now instantly connected to each other via countless portable machines. Huge increases in processing power and storage capacity mean that data is being collected and harnessed like never before. Along with the incredible benefits of such developments come substantial risks, as evidenced by big data scandals such as the one high-profile case unfolding in the news at the moment.
Past industrial revolutions have shown us that if companies and industries do not adapt with new technology, they can struggle or even fail. The change brought about by the Fourth Industrial Revolution will be inevitable, not optional, in my view, and the halal industry must therefore adapt to the new technologies available, in order to discover the benefits they offer. For, I strongly believe that the technological innovations we are witnessing today have the potential to strengthen and improve not only the economy, but also the world as a whole. The possible rewards of Industry 4.0 are staggering: heightened standards of living; enhanced safety and security; and greatly increased human capacity. Rather than falling behind, the halal industry must tap into these potential benefits if it is to continue to grow on an international level.
We must harness new technologies in order to contribute to the global spread of the halal sector. The Malaysian International Halal Showcase (MIHAS) 2017, meanwhile, provided a platform for companies from across the world to share their experiences in using technology to capture the halal market, for instance, in the areas of imports and exports, as well as in improvements in halal product packaging. Again, we see how international collaborations and the sharing of ideas can benefit the halal industry on a global scale. Although the Fourth Industrial Revolution presents a challenge to businesses and industries worldwide, therefore, it also presents an opportunity to expand and improve, and to strengthen international links, for those companies willing to think creatively and modernise with the times.
I wish now to turn to an equally important, related topic: that of responsibility, and regulation. For, it is not sufficient to pursue the global spread of halal products and services, without reflecting on the way the halal industry is run and regulated. The concept, and indeed, the philosophy of halal goes beyond the preparation of food — beyond, even, the habits and beliefs governing consumption, behaviour and lifestyle. It is also, crucially, I believe, about an ethical and wholesome way of doing business.
To that end, the regulation and governance of the halal industry is going to be key, especially if it requires strategic collaboration across the whole of the halal ecosystem involving numerous government ministries, agencies and business stakeholders. The latest initiative by the Government of Malaysia in setting up the Malaysia Halal Council to coordinate this effort is both timely and welcome. In this country, where the final authority on matters relating to Islam rests with Their Royal Highnesses The Malay Rulers, I am pleased that the establishment of this council has the consent and support of the Conference of Rulers.
Ultimately, supporting the establishment of an international standard for halal products conforms to Islam’s philosophy of the Adamic man’s mandate as God’s khalifah and stewards on earth.
With this God-given honour, we are entrusted also with a grave responsibility: that of ensuring ethics and integrity in business. We must work to establish what the Malaysia International Islamic Finance Centre, or MIFC, has called “a holistic end-to- end Syariah compliance” in the halal industry, ensuring not only the production of halal goods and services, but also a Syariah-compliant business and finance model in its value chain and ecosystem.
We need, in other words, to pursue the continued development of a “halal economy”, in the fullest sense of that phrase. The concept of the “halal economy” was in fact brought to prominence at this very conference in 2011, to describe the integration of the halal industry with Islamic finance. This is a testament to the vital role that the World Halal Conference plays, in promoting the importance of the philosophy of halal and its strong relationship with the spiritual life of Muslims, and facilitating discussions about how to take the halal industry forward in an ethical way.
According to a 2014 report by the MIFC, the global halal industry represents a major opportunity for the growth of Islamic finance models on an international level. The report describes these sectors as “natural economic partners”: the successes of the halal industry could help to promote Islamic finance, while the increased use of Islamic finance models and mechanisms could, in turn, help to ensure “end-to- end Shariah compliance”, making sure that the global halal industry is run in both a successful and an ethical manner. These two key facets of the Islamic economy need to exist in a symbiotic relationship if we are to witness the continued international expansion of a truly halal economy, which is both successful and responsible.
At the heart of Islamic finance is the aim to foster inclusive growth, and to support the livelihoods and aspirations of humankind worldwide. Islamic finance has been practiced for centuries around the world, but it has increased in prominence in recent years. Today, over US$260 billion is invested in Islamic funds in over 300 global Islamic institutions active around the world. By 2020, the Islamic finance sector is forecasted by some to grow to over US$ 6.7 trillion.
We have witnessed significant successes in Islamic finance in recent years, but there is still potential for expansion. In particular, it is striking that Syariah-compliant trade finance, specifically, represents only a very small proportion of global trade finance — in fact, approximately 1.5 per cent, as of 2016. As the halal industry continues its rapid expansion, therefore, halal industry players, together with the Islamic financial institutions, regulators and other market participants, should aspire to do more to nurture a halal ecosystem through the use of Syariah-compliant trade facilities. This would facilitate the growth of Islamic finance within the global trade economy, and would help to promote the sought-after “end to end” compliance for the halal industry.
At the same time, moreover, the halal industry could actually benefit greatly from the capital that can be generated via Islamic finance mechanisms, such as sukuk and takaful. Indeed, some halal companies are already pursuing these funding methods, such that, as of 2014, US$5 billion had been raised through sukuk by 40 issuers from the halal industry. In spite of this, according to the MIFC, however, “the potential of sukuk financing in support of halal businesses is yet to be realised”.
We have seen in Malaysia in recent years the potential of corporate sukuk financing. 2016 was a record year for corporate sukuk issuance: corporate issuers dominated the market with US$47.3 billion of issuance, representing a market share of 63.2 per cent. This is in contrast to historical trends, where issuance was driven largely by sovereigns. This is, I believe, a positive indicator, hinting at the huge global potential of sukuk funding for the halal industry, to raise funds and finance business in a fully Syariah-compliant way, with the aim of achieving that desired goal of “end-to-end” compliance in its ecosystem.
It seems no exaggeration to suggest that the core principles underlying Islamic finance — in promoting inclusion, equity, property rights and ethics — are, fundamentally, “universal values”. Islamic finance has much to offer the world’s economy, and there is a natural connection between Islamic finance principles, responsible finance, and the UN’s Sustainable Development Goals or SDGs.
Indeed, in a recent speech, I suggested that Syariah and SDG compliance are, in many ways, one and the same. I would like to reiterate that point today. The UN’s 17 Sustainable Development Goals were set out in 2015 with the ultimate aim to “end poverty, protect the planet, and ensure prosperity for all”. In promoting risk-sharing and ethical investment, as well as charitable giving through zakat and waqf, Islamic finance has the potential to play a major role in the achievement of these aims.
For the global halal industry, what this means is striving to provide goods and services in a way which is not only halal, but which is also tayyib. As those of you gathered here, will no doubt be aware, the term “at-tayyib” is used in the Quran and the Sunnah to describe something that is good and wholesome. In reference to food, for instance, the Quran calls on humankind to consume food that is both lawful and wholesome. The famous verse is when Allah subhanahu wa-ta‘ala (SWT) says:
“O humankind! Consume from the earth what is halal and tayyib, and follow not the footsteps of the devil!”
We should not be content, therefore, with simply achieving something that is halal, but instead should strive for something that is also tayyib, namely good, ethical and wholesome.
In the context of the global halal industry, this means working to supply products that are sustainable, not damaging to the planet, and pursuing business models that are ethical, responsible, and not exploitative. I have spoken already about the importance of integrating the halal industry with Islamic finance, and this, truly, is why: because the ethical and responsible mechanisms of Islamic finance can produce a business model for companies supplying halal goods and services, which is not simply halal, but which is also tayyib. Indeed, I would say that all the players within the halal ecosystem should strive to make their end-to- end transactions tayyib and wholesome.
Allow me to briefly give an example of how I envisage this wholesome or tayyib business and supply chain working in action. Imagine a company that supplied halal chicken. First and foremost, the company should be funded in a fully Syariah-compliant way, perhaps with the help of sukuk bonds and/or Syariah-compliant trade financing contracts, and financed by an Islamic bank. It should pay and treat all of its employees fairly, with the kindness and respect that are central to the teachings of Islam. Then, the chicken should be farmed in a sustainable, environmentally-friendly, and ethical manner, and ensured a good quality of life in fulfilment of our responsibility to act as khalifah and stewards of the planet. It should, of course, be slaughtered according to the proper halal ritual, transported with consideration of the damaging carbon emissions generated by certain kinds of fuel, and even packaged in sustainable and recyclable packaging wherever possible. Finally, it should be sold to retailers and consumers at prices that are fair for all involved in the transaction.
This, I believe, represents a wholesome and tayyib value chain, producing goods which are halal, and which are also sustainable and financed in a Syariah-compliant manner. It is in this way — in striving for tayyib as well as halal in this industry’s ecosystem — that I believe the Islamic economy can realise its full potential within the wider global economy.
Consumers worldwide, both Muslims and non-Muslims, are increasingly seeking ethical and sustainable options, with the aim of safeguarding the future of humanity, and of our planet. As the halal industry continues to globalise due to rising international demand, it must harness the socially responsible funding mechanisms of Islamic finance, and strive to produce goods and services which are both halal and tayyib. By capitalising on the synergies between Islamic finance principles and the United Nation’s SDGs, we can demonstrate that the Islamic economy has a vital role to play on a global level, and that it is, ultimately, beneficial to Muslims and non-Muslims alike.
After all, Allah SWT reminds us of our God-given honour in the Quran that, “We appointed you as stewards (khalifah) in the earth ... so that We might see how you behave!”
So, ladies and gentlemen: I hope we can behave by striving to make the world a better place for the entire human race, thereby realising our full potential and mandate as the Adamic man and woman. We can make a start by understanding that the true philosophy of halal is one that embraces tayyib in all of our end-to-end dealings in this world. Let us take this realisation forward in continuing to foster a truly halal economy, an economy in which the sum of its parts is not only in full legal compliance, but is also in divine concord.
Published in: The New Straits Times, Friday 6 April 2018