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EDITORIAL

COP26: Africa’s Challenges Must Steer the Climate Change Conference

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The 26th session of the United Nations Framework Convention on Climate Change Conference of the Parties, popularly known as COP26, is happening at a time when the world has just experienced one of the warmest years on record. The year 2020 reached temperatures that were about 1.02°C warmer than average. These kinds of extremes, driven by climate change, are being felt intensely across Africa.

Greenhouse gases – such as carbon dioxide and methane – are largely to blame for the changes to the climate. Some of the sun’s energy is reflected back to space and is trapped by these gases leading to a warming of the earth. Increased concentrations of these gases in our atmosphere leads to global warming and consequently climate climate.

Africa carries the heaviest burden of the associated climate change effects, despite contributing less than 5% of the world’s greenhouse gas emissions. Industrialised countries – namely China, the US, India, Russia and Japan – top the list in the emission of greenhouse gases, especially carbon dioxide.

Africa is the most vulnerable continent to the effects of climate change due to its low adaptive capacity, as a result of financial and technological limitations, and an over-reliance on rain-fed agriculture. The continent is also witnessing a higher rate of warming than the global average of 0.15°C per decade between 1951 and 2020. Given the observed global warming, it is projected that the continent will experience an increase in hot extremes and more frequent and intense rainfall extremes.

The projected changes in climate are likely to cause devastating impacts across the continent. The current case of food insecurity as a result of drought in East Africa is a case in point.

The International Monetary Fund (IMF) estimates that sub-Saharan Africa has loses of over US$520 million in direct economic damages annually as a result of climate change since the beginning of this century. The cost of implementing the continent’s response to the challenges posed by climate change is estimated at between US$7 billion and US$15 billion annually. This is projected to shoot to US$35 billion per year by 2050. Consider this, by 2050 climate change is projected to cost Africa 4.7% of its GDP while North America will lose 1.1% of its GDP.

African countries cannot be ignored, or just listened to. Their needs should shape the agenda. There must be action that immediately addresses the challenges facing the continent.

How can the world come to recognise the magnitude of all this? COP26 provides that platform.

Revisiting the Paris Agreement

The COP26 summit will bring parties together to accelerate action towards the goals of the Paris Agreement and the UN Framework Convention on Climate Change.

The Paris Agreement, created in 2015, aims to limit global warming to well below 2°C, preferably to 1.5°C, compared to pre-industrial levels. Essentially, the agreement brought all countries together in a common effort to combat climate change and adapt to its effects.

The agreement provides a framework for financial and technical support to countries who need it. It also obliges developed countries to support developing countries in their mitigation and adaptation efforts – because they are largely responsible for the losses and costs associated with climate change.

The developed nations promised to raise US$100 billion a year to support climate change adaptation and mitigation in vulnerable countries. However, reports show that this pledge has fallen short by at least US$20 billion since 2018. Unfortunately, there are no clear plans provided by the “rich” nations on how this deficit will be met. This is the time to hold them accountable.

COP26 Platform

At COP26, countries will launch an adaptation goal and adopt strategies for achieving such a goal. This presents African countries with the opportunity to shape the agenda, once more.

Leaders of African countries should approach the convention with a strong, unified voice, presenting their climate change concerns and needs.

The negotiation outcomes at COP26 must succeed in favour of Africa and other developing countries by:

  • Making finance more accessible and faster to African and other developing countries.
  • Developed nations must pledge to boost non-financial efforts in climate change adaptation, such as education.
  • A re-commitment of climate finance in line with the revised nationally determined contributions (NDCs).

In addition, African countries should continue to remind developed nations of the need to complement local adaptation efforts with global emission reductions. The concentration of carbon dioxide is on an upward trend, despite a dip in 2020 as a result of economic slowdown due to the COVID-19 pandemic.

The G20 countries account for 80% of greenhouse gas emissions with China alone emitting nearly 25% of the global emissions, closely followed by the US.

Despite emitting the least greenhouse gases, African countries have sought to mitigate the effects of climate change. On average, by 2019, African countries were already spending about 5% of their annual GDP to support adaptation and mitigation initiatives, exceeding their contributions to climate change. In addition, regional organisations such as the African Adaptation Initiative are doing their best to build Africa’s resilience in the agricultural sector.

Most African countries have explored renewable energy resources that can help reduce the emission of greenhouse gases. There have also been numerous carbon sequestration initiatives, among other environmentally sustainable investments, running across the continent.

For instance, Morocco has taken the lead globally in production of solar energy, saving the world from over 760,000 tonnes of carbon emissions annually. The harnessing of geothermal energy in Kenya is another notable initiative to reduce the country’s emissions by 32% by 2030.

African countries are playing their part. But it rests on the shoulders of all nations to stay committed to deliver on the Paris Agreement’s promise of a fair, equitable, robust response to climate change.

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EDITORIAL

Trump’s Vision for the United Nations: A Return to Peace or a Power Play?

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The Trump administration’s approach to the United Nations has been marked by both rhetoric and retreat. While officials insist that U.S. President Donald Trump envisions a return to the U.N.’s founding principles of maintaining international peace and security, the policy specifics remain elusive. What is clear, however, is that Washington’s actions reflect a shift toward a more transactional, power-driven use of the international body—one that favors big-power dealmaking at the expense of multilateralism.

The Trump administration has made no secret of its dissatisfaction with the U.N., systematically pulling the United States out of key multilateral commitments. It has withdrawn from the World Health Organization (WHO), defunded agencies that focus on human rights, and announced a full-scale review of U.S. multilateral obligations, including the U.N. Charter itself. Such moves indicate a broader strategy: Washington is seeking to reshape the U.N. into a mechanism that serves its immediate national interests rather than an institution that fosters global cooperation.

This strategy became even more apparent last week, on the third anniversary of Russia’s full-scale invasion of Ukraine. Traditionally, the U.N. General Assembly has been a stage for collective condemnation of aggressors and an affirmation of international norms. The Biden administration had previously supported resolutions that reaffirmed Ukraine’s sovereignty and territorial integrity. However, Trump’s approach suggests a departure from this collective stance, instead signaling that the U.N. could be a forum where great powers dictate the terms of engagement, sidelining smaller nations and their concerns.

Preserving Multilateralism and Justice

We believe that the integrity of the U.N. must not be sacrificed on the altar of unilateralism. The United Nations, for all its flaws, remains one of the last bastions of collective diplomacy, providing a platform for weaker nations to voice their concerns and influence global decisions. The Trump administration’s efforts to undermine multilateralism and restructure the U.N. into a tool of great-power politics threaten the very essence of global cooperation and peacebuilding.

The Islamic world, particularly nations that have suffered from unilateral interventions and geopolitical maneuvering, should be deeply concerned. If the U.N. is remolded into a vehicle for power politics, then smaller nations—many of them in the Global South—will find themselves increasingly marginalized. This trend is dangerous, not only for Muslim-majority countries but for all states that rely on international law and institutions to uphold their sovereignty and rights.

The Need for Reform—But Not at the Cost of Integrity

Yes, the United Nations requires reform. The Security Council’s structure, the inefficiency of certain U.N. agencies, and its inability to prevent major conflicts all point to the need for change. However, reform must be inclusive, transparent, and aimed at strengthening multilateralism—not at dismantling it.

The Trump administration’s vision appears to be one of selective engagement: withdrawing from commitments that uphold human rights and international development while using the U.N. as a battleground for power politics. This double standard weakens the moral and diplomatic credibility of the U.S. and threatens global stability. If Washington is truly committed to a U.N. centered on peace, then it must reaffirm its commitment to international cooperation rather than coercion.

A Call to Action

The Islamic Economist urges all nations, especially those in the developing world, to resist efforts that erode the U.N.’s impartiality. The world cannot afford a United Nations that serves only the powerful while neglecting its broader mission to uphold peace and security for all. Leaders of the Global South, including those from the Muslim world, must push for genuine reform that preserves the U.N.’s role as a fair arbiter of international law and diplomacy.

The Trump administration’s attempt to remake the U.N. must be critically examined. If the organization is to continue as a force for global peace, its leadership must not capitulate to unilateral interests. The Islamic Economist stands firmly against any efforts to dilute multilateralism, urging all stakeholders to protect the fundamental principles of justice, equity, and peace that the U.N. was founded upon.


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EDITORIAL

The Future of the US Dollar and the Rise of a Multipolar Financial Order

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For decades, the US dollar has served as the bedrock of the global financial system, wielding an influence that extends far beyond trade and investment. However, recent geopolitical shifts, particularly within the BRICS economic bloc, have placed the future of dollar hegemony under intense scrutiny. With the return of Donald Trump to the global stage—bringing with him the same aggressive economic nationalism that marked his previous tenure—the debate over de-dollarization has reached a critical juncture.

Trump’s threats against BRICS nations, warning of 100% tariffs and the exclusion of member states from US markets if they pursue alternatives to the dollar, reveal the deep anxieties within Washington’s financial establishment. Yet, rather than deterring efforts to move beyond the dollar, his rhetoric is more likely to accelerate them.

The BRICS bloc—now expanded to include Saudi Arabia, the UAE, Iran, Egypt, and Ethiopia—is actively exploring a multipolar financial system. China and Russia, in particular, have been at the forefront of efforts to reduce reliance on the US dollar. China has methodically built up alternative financial networks, encouraged trade in yuan, expanded its Belt and Road Initiative, and diversified its foreign reserves away from the dollar. Russia, facing a barrage of Western sanctions, has strengthened its financial ties with China and other BRICS partners, increasingly using local currencies for trade.

Islamic economies, too, must take note of these shifts. The Islamic world, rich in natural resources and home to key emerging markets, has long been subject to the vulnerabilities of a dollar-dominated system. Economic sanctions, inflationary policies driven by the Federal Reserve, and the arbitrary use of financial restrictions have all underscored the risks of overdependence on the dollar. The potential of a BRICS-led alternative presents an opportunity for Islamic nations to establish financial mechanisms that are more aligned with their economic realities and strategic interests.

Yet, the transition to a multipolar financial system is not without challenges. A new global currency or financial infrastructure requires deep coordination, trust, and a level of economic integration that remains complex. Nevertheless, the momentum is undeniable. Trump’s approach—marked by economic threats and trade wars—has only served to weaken trust in the stability of the US-led order. His heavy-handed use of tariffs and sanctions, even against allies such as Canada and Mexico, highlights the fragility of the existing system and reinforces the urgency of diversification.

For Islamic economies, the path forward should be clear. Engaging with alternative financial systems, strengthening trade relationships within BRICS, and exploring new currency arrangements will be critical in securing economic independence. The principles of Islamic finance—rooted in fairness, risk-sharing, and ethical investment—are well-suited to this emerging multipolar landscape. By reducing reliance on the dollar and fostering regional financial cooperation, the Islamic world can play a pivotal role in shaping a more balanced and equitable global economic order.

The decline of US dollar dominance is not an overnight phenomenon, nor is it inevitable. However, the reckless wielding of economic power by Washington, particularly under leaders like Trump, is fast-tracking a shift that may have otherwise taken decades. The question is not if de-dollarization will happen, but how quickly and effectively it will reshape the global financial system. For the Islamic world, the time to prepare for this transformation is now.


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EDITORIAL

The Economic Significance of Ramadan: A Season of Ethics, Charity, and Growth

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As the blessed month of Ramadan approaches, Muslims worldwide prepare to embrace this sacred period of fasting, spiritual reflection, and heightened devotion. Beyond its religious and spiritual essence, Ramadan also carries profound economic significance, influencing markets, businesses, charitable giving, and financial ethics in a unique and transformative way.

Consumer Spending and Economic Activity

Ramadan is a season of increased economic activity across various sectors, particularly in Muslim-majority countries. The food and beverage industry experiences a significant surge as families prepare elaborate iftar and suhoor meals. Retail businesses also witness a rise in sales, driven by purchases of new clothing, household goods, and gifts in preparation for Eid al-Fitr. The hospitality and tourism industries benefit from heightened demand for Ramadan-themed events, spiritual tourism, and hotel accommodations, particularly in Makkah and Madinah.

Additionally, digital commerce has become a key player in Ramadan’s economic landscape, with e-commerce platforms seeing record-breaking sales, especially in groceries, clothing, and Islamic literature. Financial institutions also introduce specialized Ramadan products, including halal investment opportunities and Islamic microfinance programs designed to support small businesses during the holy month.

The Role of Zakah and Sadaqah in Wealth Redistribution

One of the most defining economic aspects of Ramadan is the emphasis on charitable giving. The obligation of zakah (mandatory almsgiving) and the encouragement of sadaqah (voluntary charity) facilitate wealth redistribution, reducing socio-economic disparities and fostering social cohesion. Many Muslims choose Ramadan as the ideal time to fulfill their zakah obligations, benefiting the less privileged and supporting charitable institutions, orphanages, and humanitarian projects.

The economic impact of zakah is far-reaching, acting as a form of wealth circulation that benefits local economies. When directed towards productive initiatives such as small-scale businesses, education, and healthcare, zakah contributes to poverty alleviation and economic empowerment. This reinforces the principles of Islamic finance, which prioritizes socio-economic justice and sustainability.

Ethical Finance and Economic Discipline

Ramadan instills a strong sense of financial discipline. The practice of fasting cultivates self-restraint, encouraging individuals to rethink their consumption habits and embrace a more frugal lifestyle. This economic moderation counters the culture of excessive consumerism and promotes ethical spending in alignment with Islamic values.

Islamic financial institutions often use Ramadan as a period to reinforce principles of ethical finance, promoting investments that align with Shari’ah guidelines—free from interest (riba), excessive uncertainty (gharar), and unethical industries. Many financial firms introduce Ramadan-specific savings and investment plans, emphasizing the importance of financial prudence and long-term wealth management.

The Socio-Economic Impact on Labor and Productivity

The impact of Ramadan on labor markets varies across different industries and regions. While fasting may reduce working hours and productivity in some sectors, organizations adapt by implementing flexible work schedules to maintain efficiency. Many governments and corporations adjust official working hours to accommodate fasting employees, ensuring a balance between economic productivity and religious observance.

Interestingly, Ramadan also fosters workplace ethics, encouraging honesty, teamwork, and a heightened sense of corporate social responsibility. Employers often use this time to initiate employee welfare programs, demonstrating the values of compassion and social responsibility inherent in Islamic teachings.

Conclusion

Ramadan is not just a period of spiritual rejuvenation but also an economic catalyst that shapes markets, drives philanthropy, and reinforces ethical financial practices. From the bustling commercial activities leading up to Eid to the profound impact of zakah and sadaqah on wealth redistribution, the economic dimensions of Ramadan underscore the inseparable link between faith and finance. As we embrace this blessed month, let us not only reflect on its spiritual virtues but also on its potential to foster inclusive economic growth and social equity for all.


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