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Global Warming and the Danger to Coastal Communities

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Global Warming and the Danger to Coastal Communities
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“Go and explain to developing countries why they should continue living in poverty and not be like Sweden”, “No one has explained Greta that the modern world is complex and different and… people in Africa or in many Asian countries want to live at the same wealth level as in Sweden”. These are two of the several statements Russian president Vladimir Putin made in criticism of Greta Thunberg’s UN speech while he spoke during an energy conference last year. But why is the situation that the Russian president is referring to, so complex? And why is that the world leaders who are failing to tackle climate change are now trying to tell the world that it is not just about climate but also geopolitics? This piece tries to delve into the inevitable dilemma that is emerging in the sphere of climate change mitigation and the geopolitics that has always been the one of the topmost priorities for the nations around the globe.

The Present State

Historically, the industries and the global economy has been reliant on fossil fuels, resulting in the anthropogenic climate changes that we are witnessing today. At present, geopolitics is at the center of the struggle for mitigation of the climate change phenomenon. This has led to a variety of responses from different nations. Some are trying to postpone the responsibility, some are trying to deny, and some are trying to spearhead the fight against the problem. However, the issue of climate change is not one that can be solved by one or a subset of nations working in isolation. It remains to be seen how the results of climate change as well as the struggle for mitigation will impact the ground reality for the populations, as it is widely expected that the effects on different nations will be to different extents. Some are set to be hit harder than others, and some are going to be hit even if they have not done anything to contribute to the problem. In this background, many of the concerns about the technological manipulation of nature, environmental destruction, North-South relations, sustainable development, conflict and resource wars have returned to prominence in recent years in the increasingly intense debate about climate change. In this piece we a look at some of the major themes in the geopolitical landscape today related to climate change and climate change mitigation activities.

Russia and Saudi Arabia are two of the several examples of nations which depend on energy commodities export for most part of their revenue. They are also the best examples of nations with vastly established fossil fuel production and processing infrastructure. Accordingly, they face different geopolitical challenges than others in terms of their climate mitigation policy adoptions. Nations like Russia and Saudi Arabia, as well as Qatar, Iran, Venezuela, and UAE depend on exports of oil and gas to developing and emerging economies like China and India. However, an increasing emphasis in these developing economies for a transition towards renewable energy sources has been creating unrest in the oil, gas as well as coal export dependent nations. In case of Russia, another issue, in form of permafrost thawing has been emerging since the last few years as a big worry threatening its infrastructural facilities in Far East region as well as the Siberian region. Last year Russia witnessed several oil spills due to weakening infrastructure in its facilities. However, this issue is dwarfed due to the fact that infrastructure can be upgraded, but if the demand for oil and gas reduces in the global markets due to a renewable energy transition, then the vast infrastructures will become loss generating assets.

                In Gulf countries, the narratives of collapse and chaos in a post-oil world has taken over most policy makers’ imagination. According to some predictions, over the next 50 years, these countries could be facing a twin issue of increasing strain on societies and economies due to climate change on one hand and increasing shortage of funds on the other, either due to the decreasing exports and demand, or due to simply less production due to waning stores of energy. Moreover, emergence on alternative sources like shale oil in US and oil and gas in Central Asian region can also lead to increased strain in these countries. This has led to new geopolitical conditions becoming possible for the Gulf region which has for long been dependent on a US hegemony in the region for overall security framework. A receding US interest can witness an increasing interest of other powers like China and Russia.  

Moving to the developing world, economies like India, Brazil and even China have at various times expressed an unwillingness to concede mitigation of emissions of greenhouse gases and pointed towards their right to economic and industrial development, world equity and issues. This stance has attracted criticism from the developed world who see this struggle against climate change as a journey in which every nation needs to stand in unity. However, on one hand where concepts like ‘Common but Differentiated Responsibilities’ has emerged in climate action frameworks, countries like India have showed that they are ready to lead in the action for climate change mitigation by implementing policies to work towards a transition to renewable energy. This stance although is also influenced by the fact that India is forced to import most of its fossil fuel needs from other countries which exists as a big burden to its economy. By decreasing its reliance on energy imports, India can look towards following a more independent course in the geopolitical order. As seen in the collapse of Iran-US relations which led to India being forced to abandon its oil imports from Iran, a situation where India is not dependent on oil itself, stands to be a big win. Further, initiatives like the International Solar Alliance have helped India to cultivate India’s image as a responsible global actor, at par with other like the European Union who has been using climate change activism as an element of its foreign policy to retain command over the global climate change policy agenda and thus assert not only regional, but global influence.

               Talking about the global powers, US and China are undoubtedly the two biggest players in the world today when it comes to geopolitics, as well as emissions. In US, about half of electricity is generated through coal power plants as the nation has abundant coal deposits. The last four years under President Trump witnessed US detaching itself from major climate change action frameworks like the Paris Agreement based on the reasoning that any policies which have a chance to curb economy growth will have a disastrous effect on the lives of American citizens as well as national security. On the other hand, China, which has for some time now been the biggest greenhouse gas emitter, has now been working towards becoming the leader in sphere of sustainable energy. Chinese president Xi Jinping at the last year’s United Nations General Assembly made the promise that China will become carbon neutral by 2060. According to scholars of the field, through this stance, China not only wants to enhance its geopolitical position as a main partner to EU for future, but also wants to take away attention from its human rights abuses, and aggressive behavior. This phenomenon needs to be understood in the light of the fact that today almost all mining, production and processing of rare earth elements, which are essential for the production of renewable energy infrastructure like solar panels, takes place in China. Thus, providing not only an upper hand to China as an economic power but also as a great geopolitical power in sustainable energy.

               Not all countries however face the dilemma of effects of slowing economy in case they go for transition to renewable energy or adopt policies that mitigate emissions. The poorest of the countries stand to go bankrupt and loose relevance due to geopolitics of climate action in case the world decides to transition fast to renewable energy. These are the poor countries of Africa which have recently started establishing their oil production and now almost completely depend on it. As mentioned by Russian president Putin, these are the economies which look towards economic development based on their energy stores. They however have massive potential for renewable energy extraction too. But this potential need massive amounts of investment in infrastructure to realize, an element that these economies do not possess. Further, as the oil produced by these satisfy the needs of the developing and emerging economies, most of their buyer nations will see no benefit in trying to aid the African economies to substantially create their supplier’s renewable energy sector.

               Similar is the case of the Central Asia region where the nations depend on extractive industries of oil, coal, and gas. Both climate impact as well as climate change mitigation and adaptation in this region is projected to heighten geopolitical tension.  Not only are the foreign direct investments in the region low at present, but the existing investments do also not prioritize resilient and sustainable development and is related mostly in sector of non-renewable energy resource extraction. The geopolitics of this region is connected in more than one way with the issue of climate change. The region is prone to water and energy shortages. Whereas carbon rich Kazakhstan, Turkmenistan and Uzbekistan extract and use oil, gas and coal for their energy production, other nations in the region- Tajikistan and Kyrgyzstan, which have lower GDP per capita uses clean hydro energy. Thus an inequality exist as the downstream nations are those which are more reliant on fossil fuels and the upstream nations, although not energy rich, possess ample hydroelectric potential. This inequality is estimated by the scholars to create strains in the region which can spill over in the rest of Asia.

The Dilemma

               It might seem like the fossil-fuels based energy export reliant nations are set to lose the most in the coming future as the world starts looking for ways to transition towards clean fuel and energy in the coming years. However, the oil and gas industry might not be ending anytime soon.

               For instance, Nord Stream 2, a planned pipeline through the Baltic Sea, which is expected to transport natural gas over from Siberia to consumers in Europe is being looked upon as a secure and reliable as well as cleaner source of energy for the coming decades. It indeed will replace the coal powered sectors in Europe and help reducing carbon emissions, however, this is also expected to provide Russia a sort of geopolitical push that it has not witnessed in many years now in terms of its relations with Europe, especially since the conflict with Ukraine in 2014. Although, this has changed in recent times as tensions arose with Georgia and the political chaos around Alexei Navalny’s poisoning, who was being seen as a political competitor to President Putin by some in Russia.  However, this is not to say that Russia has not been working towards climate change mitigation agenda. In November last year, Russian President Putin signed a decree ordering the Russian government to work towards meeting the 2015 Paris agreement to fight climate change, but stressed that any action must be balanced with the need to ensure strong economic development.   This in geopolitical terms can be seen as an attempt to align Russia with the change in presidency in US, where the new president  Joe Biden is supposed to be an avid supporter for climate activism and is expected to work towards making US carbon neutral with a long-term plan, in stark contrast to the previous president Donald Trump.

               Another geopolitical battle is emerging in the Arctic, where several nations like the US, China and Russia are no vying for dominance. In Arctic, with melting snow, shipping is all set to witness an increase. According to some estimates, if shipping along the Arctic becomes fully accessible, Bering Sea can become an area of contention for US and Russia, as well as China, thus reducing the importance of other choke points and the nations controlling them, like Egypt and Southeast Asia. This phenomenon also exists in line with the argument that if oil ceases to be a central driver of the global economy, many regions like Gulf are set to see their long-standing relations with the western nations like US change.

               Climate change related migration, which can result out of several reasons like submergence of islands, droughts due to varying rainfall patterns, stronger hurricanes or storms, or massive flooding of rivers due to higher rate of melting of glaciers that feed them with water, is also becoming a geopolitical contention that the nations are staring at today. The world has witnessed in 2015 refugee crisis in Europe, the extent of chaos, heightened populism, and nationalism, as well as lack of trust in multilateralism and established institutions that can be caused. Even though in this case, the result was not due to underlying climate change related challenges directly, similar effects due to influx of refugees and similar migration patterns can be expected from the regions of changing patterns of rainfall. This leads us to think where the current situation leaves us today for the future.   

What does the Future Hold?

               For many economies, initial investment cost for renewable energy systems is usually high, resulting unaffordability for many, especially in developing countries. Some others on the other hand, like Malaysia, with some of the highest level of subsidies on fossil fuels result in renewable energy market to remain economically weak and uncompetitive. Similarly, for Australia’s economy, which has for long been reliant on  fossil fuel industries to ensure the economic prosperity across the country, it is now becoming an issue of contention which it will need to resolve in order to ensure not its own, but also its neighborhood’s sustainability lying in the Indo-Pacific region as low lying islands which are at the risk of submergence due to climate change related effects.  

               In today’s world, not only can conflicts related to renewable energy infrastructure lead to stress as seen in case of Central Asian region, but also strain over issues like transfer of technology between developed and developing countries can turn into bigger forms of geopolitical conflicts. It also remains to be seen if the resources like rare-earth metals, which are needed for expansion of cleaner energy platforms will be available according to need of a nation or be made available to the highest buyer and turned into a business. The global order as it stands today between the oil producers and the oil consumers is also set to change as the climate change mitigation policies are adopted resulting from increasingly severe negative effects emerging from the anthropogenic climate change.           

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Trump’s Tariff Battles: The Global Fallout

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Baba Yunus Muhammad

Tariffs are a form of taxation on goods crossing national borders. While proponents argue that they can protect local industries by making imports more expensive, most economists view them as a blunt instrument that can harm both the target country and the domestic economy while also escalating trade conflicts. Here’s an overview of Trump’s latest tariff threats and their potential impact worldwide.

China: Retaliation and Countermeasures

During his campaign, Trump threatened a 60% tariff on Chinese goods, but the actual figure has been set at 10%. When combined with existing tariffs, this brings the average rate on Chinese imports to between 20% and 30%. Trump claims these measures are aimed at pressuring Beijing to crack down on the smuggling of fentanyl and its precursors into the US. However, analysts see broader economic motives at play.

With 14% of China’s exports directed to the US, the impact of Trump’s tariffs is somewhat limited. Many Chinese firms have already relocated parts of their supply chains to circumvent these barriers. Still, Beijing has responded forcefully by imposing 15% tariffs on US coal and liquefied natural gas, and 10% tariffs on crude oil, farm equipment, and large vehicles. Additionally, China has imposed export restrictions on critical materials such as tungsten and tellurium, which are vital for US industries.

Perhaps more consequentially, China has initiated an anti-trust investigation into Google, raising concerns that this could be the beginning of a broader crackdown on American tech firms operating in the country. The deepening divide between the world’s two largest economies could have long-term global repercussions.

Mexico: Short-Term Relief, Long-Term Uncertainty

With 83% of Mexico’s exports going to the US, the impact of tariffs would have been significant. However, a last-minute deal has paused the proposed tariffs for a month.

While the official justification for the tariffs was Mexico’s alleged cooperation with criminal organizations facilitating illegal immigration and fentanyl trafficking, critics argue that the real motivation is Trump’s opposition to trade deficits. Economist Paul Krugman has warned that measures designed to eliminate trade deficits could also deter foreign investment.

In response, Mexican President Claudia Sheinbaum dismissed Trump’s claims as baseless but agreed to deploy 10,000 troops to the border. The US, in turn, has pledged to curb the flow of high-powered weapons into Mexico. Despite this temporary resolution, business leaders worry about long-term instability, with Brian Winter, a Latin America expert, warning that companies may reassess Mexico’s role in North American supply chains.

Canada: Last-Minute Reprieve Amid Economic Anxiety

A temporary pause on tariffs against Canada was announced following urgent discussions between Trump and Prime Minister Justin Trudeau. Given that 77% of Canada’s exports go to the US, this was a crucial development.

The justification for targeting Canada—stemming the flow of fentanyl—was unconvincing, as only 19kg of the drug was seized at the US-Canada border last year compared to 9,600kg from Mexico. However, the vagueness of Trump’s objectives may actually work in his favor, allowing him to declare victory without a clear benchmark.

Canada had prepared retaliatory tariffs on $106 billion worth of US goods, primarily from Republican-leaning states. Meanwhile, a grassroots movement in Canada has emerged in response to Trump’s threats, with campaigns encouraging domestic purchases and branding pro-Trump figures as “Vichy Canadians.”

European Union: Preparing for Retaliation

Trump has vowed that new tariffs on the European Union will “definitely happen,” citing the US’s goods trade deficit with the bloc, which he claims exceeds $300 billion. However, official data from 2023 puts the deficit at approximately $160 billion. Furthermore, when services are included, the US actually runs a trade surplus of $107 billion with the EU.

In anticipation of Trump’s measures, the European Commission has devised a “carrot and stick” strategy—offering increased imports of US liquefied natural gas while preparing retaliatory tariffs on American goods. The outcome of these negotiations will be pivotal for transatlantic trade relations.

United Kingdom: A Balancing Act

While Trump has suggested that the UK might face tariffs, he also indicated that a resolution could be found, citing his positive relationship with Prime Minister Keir Starmer. For now, this uncertainty leaves Britain in a precarious position.

With 68% of the UK’s exports being services, which are not subject to tariffs, the immediate impact may be lower than for other countries. However, the UK’s trade relationship with the EU complicates matters. If Trump’s tariffs escalate into a full-scale trade war, Britain could be forced to choose between aligning with the US or the EU—its largest trading partner.

Conclusion: A Risky Game

Trump’s tariff threats have created economic uncertainty across multiple regions. While some countries have secured temporary relief, the long-term impact of these measures remains unclear. If trade tensions continue to escalate, the global economy could face significant disruptions, with repercussions extending far beyond the US and its trading partners.


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African Nations Target 300 Million New Power Connections by 2030

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In a bold initiative to address Africa’s persistent electricity deficit, several African nations have committed to opening up their energy sectors to attract investment and provide electricity to 300 million people by 2030. This effort, known as Mission 300, was launched in April by the World Bank and the African Development Bank (AfDB) and aims to mobilize at least $90 billion in funding from multilateral banks, development agencies, private investors, and philanthropies.

Bridging Africa’s Energy Gap

Africa remains the region with the highest number of people lacking access to electricity, a major hindrance to economic growth and development. To tackle this, Nigeria, Senegal, Zambia, and Tanzania, among other nations, have pledged to reform their electricity utilities, integrate more renewable energy, and increase national electrification targets. These commitments were made at an energy summit attended by African heads of state in Tanzania’s commercial capital.

Kevin Kariuki, Vice President for Infrastructure at the AfDB, emphasized the need for cost-effective expansion and rehabilitation of national electricity grids. “We want to expand and rehabilitate our electricity grids using the least cost possible,” Kariuki stated.

Financing the Mission

World Bank President Ajay Banga highlighted that the initiative’s success hinges on unlocking significant private sector investment. The World Bank plans to contribute $30-40 billion, while the AfDB will provide an additional $10-15 billion, with the remainder expected from private investors and other sources.

To encourage private sector participation, the World Bank will only disburse funds to countries that implement necessary regulatory and policy reforms. Historically, investors have been hesitant due to concerns over unfriendly regulations, bureaucratic delays, and currency risks.

Renewable Energy at the Core

Half of the planned new electricity connections will be through expanding national grids, while the other half will rely on renewable energy sources, including solar and wind-powered mini-grids. This approach aligns with Africa’s growing push toward sustainable energy solutions, reducing dependence on fossil fuels and enhancing energy resilience. Ajay Banga underscored the developmental significance of electrification, noting that access to power is a key enabler of economic growth, job creation, and poverty reduction.

Looking Ahead

As African nations embark on this ambitious journey, the success of Mission 300 will depend on effective implementation, transparent governance, and sustained investor confidence. If successful, this initiative could mark a turning point in Africa’s economic transformation, unlocking new opportunities for businesses and communities across the continent.

The coming years will be critical in determining whether these commitments translate into tangible results, providing millions of Africans with the electricity needed to power industries, businesses, and households.


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Pakistan’s Bold Gamble: Can it Build a Riba-Free Economy?

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Imagine a world where money doesn’t just grow—it heals. That’s the vision 2,000+ global leaders brought to life at the 8th World Islamic Economics and Finance Conference (WIEFC) with Islamic Finance Trends 2024 in Lahore this January. Forget stuffy lectures—this was a revolution. Pakistan, often overlooked in global finance debates, suddenly became the heartbeat of a $4.5 trillion ethical finance movement. From AI tools sniffing out hidden interest to ‘green Sukuk’ funding hurricane-proof homes, this conference didn’t just talk about change—it blueprinted it.

Why should you care? Whether you’re a student, investor, or just tired of Wall Street’s greed-first mindset, Islamic Finance Trends 2024 is reshaping how money works for everyone. Think climate action funded by ethical bonds, apps that calculate Zakat in seconds, and microloans lifting farmers out of poverty—without interest.

Stick around. We’re breaking down the conference’s biggest reveals, from Pakistan’s bold legal reforms to the tech tools making ethical finance as easy as ordering Uber Eats. Spoiler: This isn’t just about halal banking—it’s about building a financial system that doesn’t leave anyone behind.

Pakistan’s Legal Revolution—A Model for the World

Pakistan’s bold legislative reforms have turned heads globally. The 2022 Federal Shariat Court (FSC) ruling, which declared interest-based systems unconstitutional, set off a chain reaction. By 2024, the 26th Constitutional Amendment cemented this shift, mandating a full transition to Shariah-compliant finance by 2028. But what does this mean in practice?

  • Pakistan’s Islamic banking assets soared to 50 billion in 2024, up from 30 billion in 2022. This growth now represents 22% of the nation’s total banking sector, with projections hitting 35% by 2027. Analysts attribute this surge to regulatory incentives, including tax breaks for Shariah-compliant institutions and public awareness campaigns.
  • Globally, the Islamic finance industry expanded by 14% in 2023, driven by Sukuk issuances worth 250 billion a record high. Saudi Arabia’s12 billion sovereign Sukuk and Indonesia’s blockchain-based offerings contributed significantly.

Malaysia, a pioneer in Islamic finance with a $900 billion industry, recently signed a knowledge-sharing pact with Pakistan. “Their regulatory framework is a gold standard,” noted Bank Negara Malaysia’s governor, citing Malaysia’s dual banking system, which allows conventional and Islamic banks to operate side-by-side. Key features include:

  • Shariah Advisory Councils: Independent bodies that audit financial products.
  • Tax Neutrality: Equal tax treatment for Islamic and conventional instruments.

Saudi Arabia’s Vision 2030 has allocated $1.2 billion to develop fintech solutions compliant with Shariah principles. The Saudi Central Bank (SAMA) launched a sandbox in 2023, testing 40+ startups focused on digital Zakat platforms and AI-driven Murabaha contracts.

Dr. Hussain Qadri’s Vision: Beyond Compliance

In his keynote, Dr. Hussain Mohi-ud-Din Qadri warned against “checklist Islamization.” He argued:

“Replacing ‘interest’ with ‘profit’ in contracts isn’t enough. True Islamic finance must dismantle systems that perpetuate inequality.”

His speech highlighted Pakistan’s new Zakat-based social safety net, which redistributes 2.5% of assets annually to 8 million low-income families. The program uses biometric verification to prevent fraud, ensuring 98% of funds reach intended recipients.

Converting Pakistan’s $130 billion interest-based debt into Shariah-compliant instruments is a Herculean task. The solution? Asset-backed Sukuk—a financial instrument that ties returns to tangible assets like infrastructure or renewable energy. Unlike conventional bonds, Sukuk holders own a share of the asset, aligning with Islam’s prohibition of speculative risk.

In March 2024, Pakistan issued $2 billion in green Sukuk to fund wind farms in Sindh. The offering was oversubscribed by 300%, attracting investors from the UAE and Singapore. By 2025, these projects are expected to power 1.2 million homes and cut carbon emissions by 4.5 million tons annually. Key terms:

  • Tenure: 10 years.
  • Profit Rate: 7% annually, tied to energy sales.
  • Guarantor: International Finance Corporation (IFC).
  1. Nigeria: Lagos State’s $1.25 billion Sukuk funded the Lekki Deep Sea Port, creating 170,000 jobs. Investors receive profits from port operations, with returns averaging 9% since 2024.
  2. Indonesia: The world’s first blockchain Sukuk raised $500 million in 2024, with 60% of buyers under 35. Built on Ethereum, the platform allows real-time tracking of proceeds.
  3. Germany: Tesla’s Berlin Gigafactory secured €750 million via hybrid Sukuk, blending Islamic finance with ESG principles. Proceeds fund solar panel installations and worker housing.

In Punjab, a pilot project offers micro-Sukuk to small farmers. Instead of loans, investors receive a share of harvest profits. Early results:

  • 40% rise in crop yields due to better equipment access.
  • Default rates below 2%, compared to 15% for traditional microloans.
  • Farmers like Ali Raza, 42, report higher incomes: “I used to pay 20% interest. Now, I share 10% of my wheat profits—it’s fairer.”

Education Crisis—Building the Next Generation of Experts

The Islamic finance talent gap is staggering. With 1.9 billion Muslims worldwide, the industry needs 1 million new professionals by 2030—but current graduation rates meet only 30% of demand.

Since 2006, Kuala Lumpur’s International Centre for Education in Islamic Finance (INCEIF) has trained 25,000 professionals across 100 countries. Its secret? A curriculum blending Shariah, finance, and tech. Courses include:

  1. Fintech Ethics: Balancing AI with Shariah principles.
  2. Climate Finance: Structuring green Sukuk.
  3. Pakistan’s new National Islamic Finance Development Fund (NIFDF) aims to replicate this, targeting 10,000 graduates by 2030. The fund partners with 15 universities to offer scholarships and internships.
  • Egypt’s NowPay: This AI platform offers “halal investing” tutorials to 500,000 users monthly. Interactive modules simulate real-world scenarios, like screening stocks for Shariah compliance.
  • Saudi Arabia’s Hala: A robo-advisor that screens 10,000+ stocks in real-time using algorithms vetted by scholars. Users grew by 300% in 2024.

A 24-year-old graduate of Lahore’s Islamic Finance Academy, Rahman now designs Sukuk for a Dubai-based bank. “My internship at Malaysia’s CIMB Islamic changed everything,” she says. “We need more cross-border programs.” Rahman’s team recently structured a $500 million Sukuk for a Saudi solar project, integrating ESG metrics.

Ethical Finance Goes Global—Unexpected Adoption

Islamic finance is no longer confined to Muslim-majority nations. From London to Tokyo, ethical banking is resonating with ESG-focused millennials.

Launched in 2024, Britain’s first fully Shariah-compliant pension fund attracted £300 million in six months. “Even non-Muslims are opting in,” says fund manager Amina Khan. The fund excludes companies with debt-to-asset ratios above 33%, aligning with Shariah’s risk-sharing ethos. Top holdings include Unilever and Nestlé, both screened for ethical supply chains.

Goldman Sachs’ Islamic ESG ETF saw $1.2 billion in inflows in Q1 2024, outperforming conventional funds by 8%. The ETF uses a dual screening process:

  1. Shariah Compliance: No alcohol, gambling, or interest-based income.
  2. ESG Metrics: Companies must score B+ or higher on climate audits.

Toyota’s $500 million Sukuk funded a hydrogen-powered vehicle plant in Osaka. Meanwhile, 40% of Japanese homebuyers now consider “ethical financing” a priority—up from 12% in 2020. Firms like Japan Islamic Finance Consultancy (JIFC) facilitate Musharaka (partnership) agreements, where banks and buyers co-own properties.

Pakistan’s 2028 Roadmap—Bold or Overambitious?

Dr. Qadri’s WIEFC address laid out a three-pillar strategy:

  1. National Islamic Finance Development Fund:
    • $200 million pool with 30% reserved for women-led startups.
    • First project: A blockchain Zakat platform to track donations from source to beneficiary. Pilot launches in Karachi in 2025.
  2. Regulatory Sandbox:
    • Testing AI Shariah auditors that scan contracts in seconds. The AI cross-references 50+ scholarly opinions to flag non-compliant terms.
    • Pilot with Karachi’s Stock Exchange begins Q3 2025.
  3. Rural Inclusion:
    • 15 million unbanked Pakistanis to gain mobile Islamic banking access by 2027.
    • Partnering with China’s Alipay to deploy 10,000 agent networks in villages. Agents earn commissions for onboarding users.
  • Skeptics: “Egypt took 15 years; Pakistan’s 2028 deadline is reckless,” argues Cairo-based economist Dr. Farid. He cites Egypt’s 2004-2019 transition, which required rewriting 120+ laws.
  • Supporters: “Iran eliminated interest in 18 months post-1983,” counters Dr. Qadri. The Central Bank of Iran replaced interest with “expected profit rates,” though critics argue this is semantics.

Climate Action—The Unlikely Role of Islamic Finance

A surprise WIEFC theme was climate change. With 63% of Sukuk funding green projects, ethical finance is becoming a climate ally.

In March 2024, the UAE’s $1.5 billion green Sukuk for Dubai’s Mohammed bin Rashid Solar Park sold out in 3 hours. The project will offset 6.5 million tons of CO2 yearly—equivalent to taking 1.4 million cars off roads. Investors include BlackRock and Norway’s sovereign wealth fund.

After 2022’s catastrophic floods, Pakistan launched Qard al-Hasan (benevolent loans) for rebuilding. Features:

  1. 0% interest, 5-year repayment grace period.
  2. 200,000 homes rebuilt by 2024, using climate-resilient designs like raised foundations and bamboo frames.

Technology—A Double-Edged Sword

As AI reshapes finance, WIEFC speakers debated: Can algorithms uphold Shariah ethics?

  • Bahrain’s Rain: A crypto exchange screening tokens for Shariah compliance. Rain’s scholars reject tokens linked to gambling or excessive debt.
  • Pakistan’s Nayapay: Mobile app offering AI-driven Zakat calculations to 2 million users. The app scans bank statements and suggests donations based on income and assets.

Dr. Kamarul Zaman Yusoff warned:

“Technology can’t replace scholars. An AI might miss the maqasid (higher purpose) of a transaction.” He cited a 2024 case where an AI approved a contract with hidden interest (Riba), later overturned by scholars.

Lagos State Governor Babajide Sanwo-Olu:

“Our Sukuk-funded port proves Islamic finance can drive development without debt traps. We’re replicating this model for schools and hospitals.”

France’s Ethical Banking Experiment

Société Générale’s Paris branch now offers Shariah-compliant mortgages. Client Marie Dupont:

“I’m not Muslim, but I prefer their transparent pricing. No hidden fees—just a fixed profit rate.”

Finance Minister of Indonesia Sri Mulyani Indrawati:

“Young investors want tech and ethics. Blockchain Sukuk delivers both. Our next step? Tokenizing Waqf (endowment) assets.”

The WIEFC 2025 made one truth undeniable: Ethical finance isn’t a niche—it’s the future. As Dr. Qadri concluded:

“Profit and piety can coexist. Our task is to build systems that honor both.”

What began in Pakistan’s flood-ravaged villages with interest-free Qard al-Hasan loans now echoes on Wall Street through Goldman Sachs’ billion-dollar Islamic ETFs. Islamic Finance Trends 2024 aren’t just reshaping markets—they’re rewriting the rules of ethical wealth. From Saudi Arabia’s $12 billion green Sukuk funding solar megaprojects to Indonesia’s blockchain-powered bonds attracting Gen Z investors, this year has proven one truth: money can uplift communities and portfolios when guided by conscience.

Pakistan’s bold legal reforms—eliminating Riba by 2028—show how nations can balance faith and finance. Malaysia’s education hubs and Nigeria’s Sukuk-funded ports prove this isn’t a niche movement. Even skeptics can’t ignore the numbers: a $4.5 trillion industry growing 14% annually, 63% of Sukuk funding climate projects, and apps like Egypt’s NowPay making halal investing as easy as TikTok.

But the real win? Islamic finance’s DNA—zero interest, shared risk, and ESG alignment—is pushing all finance toward fairness. Whether you’re a farmer in Punjab accessing micro-Sukuk or a Tokyo salaryman choosing ethical mortgages, 2024’s trends offer a roadmap: profit doesn’t have to come at humanity’s expense.

Courtesy: Halal Times


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