Selected Papers on Islamic Economics

Compiled by Moulana Ahmed Fazel Ebrahim

[The Role of Foreign Aid|Media Ignorance]
[A Drain by Emigrating Brains |Economic Control]

People Are Enemies to that which they are Ignorant of

Introductory Article

Islamic economics encompasses every sector of activity. Numerous cultural ramifications emerge through the ages requiring a renewed insight into the interpretations of the Shariah, some of these are changed while others remain inflexible. We cannot claim to be following Islam while we do not apply most of its teachings.

Therefore plenty of Muslims who do not uphold Islam ,except in name, turn a deaf ear when they hear of the Islamic Economic System since they well know that the system is interest-free. To be rather precise, the system does not make any allowances for interest-related contracts.

Such Muslims, proceed to attack this concept, which is totally new to them, since they have neither bothered to study Islam and are neither willing to accept those of its teachings which run contrary to what they desire to implement or against that which they presently undertake. Some of these Muslims are university and college graduates, business people and other professionals. They have become enemies to that which they do not know! They thus dictate anti-Islamic policies and ensure that these are executed and accepted in the circles and institutions within which they operate.

Muslims, especially those who are engaged in business are obligated to study the Islamic Economic System and to apply it. We cannot respect or accept the aberrant views of those who intentionally or ignorantly intend to stop the progress of Islamic Economics due to many evil and ill objectives, despite the fact that they seek the benefits and the protection of such a system.

It is sad that we have to ask, “What has happened that has caused Muslims to live for centuries as strangers to Islam?” They have failed to learn except the four principles, Salaah, Siyaam (fasting), Haj and Zakaah. Many Muslims even show negligence in the discharge of some or all of these Faraa’id (obligatory duties). Muslims have discarded and ignored the Islamic System to an extent that ultimately led them to choose the legal system of those who colonised their lands and the systems of other countries to which they selected to emigrate.

Colonisation, Westernisation, Communism, Capitalism and other ideologies have each its own culture and infrastructure. Muslims trapped into these systems set forward to accept and apply these intruding thoughts and threw up their own culture and teachings.

Despite the cries of refutation and warning from our Ulema and concerned Muslims, the general populace continue to reject Islamic norms and consider advice as mere echoes that are to be left to fade in the air.

The Masaajid pulpits are often left for the ignorant to say whatever they want.The doors of corruption and propaganda have been widely opened in the various media and informational services. Newspapers and magazines welcome all those who propagate Western, Christian and/or anti-Islamic thought.

The weapons of those who propagate Westernisation are sharp and diverse. They have managed to change educational curriculars, in the primary stages to university levels, from being religious and material to that which is solely intellectual and non-religious.

In Islamic societies, Islamic Tarbiyyah (education and upbringing) has been therefore left at a marginal level! The student reaching secondary schooling is considered to be mature and fit to end association with Islamic Education. The students then begin to end their association with the Dien. The university is a place filled with academic sciences that are totally separated from religion.

Many or most Muslim students, who ought to imbibe themselves with the Islamic teachings and further their association to Allah, now only study liberal, democratic, socialist and other political and legal systems. These students, whose primary responsibility is to know and promote Islamic Law, are now engaged in promoting French, English or American Law, and then blame the very Ulema who taught them Islamic fundamentals as those who are backward and who did nothing to preserve Islam.

The commerce, accounting and economic students fear to apply or study the Islamic economic system since their entire curriculum is based upon a Ribaa or interest based economic system, the application of which, brings to them the attraction of financial resources. They find no need to study or consider the Islamic financial model since their peers, in the Capital World, reject it. Even after graduation and intergration with Islamic societies and Muslim business people, they still continue to viciously promote the interest based financial system.

How distant are we from Allah’s Shariah? When will we practically apply Islam’s laws? It is ofcourse firstly obligatory that we apply these rulings upon our ownselves. Numerous Muslim countries operate on the interest-system, despite knowing that Islam rejects it. They however provide feeble excuses and invalid interpretations of interest to justify their activity. This is the reality towards which they have diverted.

If this is our situation, then how would we face our Sustainer on the day that we are to face Him? Each person would be held liable for that which he had earned.

The biggest problem is therefore related to the blind following of foreign cultures and giving vent to the desires of the soul. This is expressed in a proverb relating to a father who had left gold coins for his son, but the latter thereafter went out to steal because he did not know the difference between gold and brass. The very same situation is reflective of our state of affairs. This is because we have diverted our attention from the treasures of the Dien which will improve our worldly and post-worldly condition, and instead, have opted to foreign objectives of life. We have thus become subject to economic powers that have diverted our energies solely towards materialism.

The application of Islamic economic principles would expel poverty from Muslims and from Islamic countries and the adoption and execution thereof would motivate businesses, encourage economic growth, reduce unemployment and curb false increases in the inflation levels

When sceptical Muslims are informed of such concepts, they blatantly answer by statements that conclude in the expression, “Our foreign experts do not agree with your view.” Whenever they are guided towards the Islamic model, which is designed by Allah, who had created man and who best understands man’s needs, they answer, “Where have you found this innovated theory?” If it is answered that the theory is found and elucidated in the very depths of our cultural, historical and religious works, they reply, “We have not read or studied them.” The truth of the matter is that they have not even heard of such a matter since they have neglected and discarded it as unimportant material that befits location in museums and cultural libraries that deserve no attention or significance.

When these works are exposed to them and when translations thereof are forwarded to them in an academic format that proves the practicality of the system, then they cunningly distance themselves, hiding their astonishment upon the evidence. The so called intelligentsia among them, then fight against it and argue without reason, fearing the shame facing their affairs and because their religious ignorance has been made manifest.

This is the condition of Muslims today. This is however very much better than that which existed in the near past. Islamic awareness has begun to spread. Islamic revival is becoming a general issue. Many people have turned to their religion in the desire to find a personal and distinguished objective. The road is however long and filled with thorns and holes. Those that take this path should therefore arm themselves with patience and fortitude. They must firmly believe that Islamic Law must prevail over all Islamic States. Their courage to apply the “Shariah” code must not languish. Allah will assist whosoever assists His Dien. “And Allah is (eternally) controlling over His affair, but most people do not understand.” (Surah Yusuf verse 21)

Details extracted from the Editorial. “An-Naasu A’daaun Limaa Jahilu [People are enemies to that which they are ignorant of].” Al-Iqtisaad-ul-Islaami [Islamic Economics] Feb. & Mar. 1994:4 – 5.

Note: This magazine was published by Dubai Islamic Bank.

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The Role of Foreign Aid

Introduction

A problem plaguing the economics of some Muslim countries is the servicing of foreign loans that it obtained and which increases to an ultra-high level. This is because the borrowing country fails to meet its periodical payments. At times, this could be as bad as leading to the direct devaluation of its currency. This issue, coupled with non-productive investment that provides little or insignificant foreign exchange, also leads to the debtor countries’ inability to service escalating credit.

It is surprising that poorer or needy Islamic countries obtain interest-based loans from major banks. Unfortunately, the rich Islamic countries also invest in interest-dealing banks, especially in those owned by foreign countries. The Qur’ânic prohibition against interest has been violated in both instances since Muslims are neither permitted to borrow on interest and neither can they accept to take interest by investing on such a basis. Interest is thus a burden for the debtor countries, and the richer Islamic countries are Qur’ânically prohibited from using interest received for their benefit, unless of course if Islamic jurists permit the discharge of taxation, levies, penalties, etc. by non-Islamic states from such interest.

The Qur’ân has clearly prohibited Muslims from consuming or taking interest. The richer Muslim countries that invest in interest dealing banks also lose the purchasing power of their resources, unless of course if they violate Allah’s order even further by using such interest. They also then assist in the strengthening of the interest system. If this be the situation, then Allah’s penalty and punishment to them would be inevitable.

Borrowing Muslim countries have unfortunately neither curbed expenditure upon Islamically prohibited avenues, e.g. the music industry (in most Islamic countries). and the wine & beer industry (e.g. in Morocco until now, i.e. 1995). Nor have they laid an infrastructure that leads to better utilisation of existing resources. The weak imân (faith) of Muslims in these countries has also led them to violate Islamic injunctions by investing their capital in foreign interest-dealing banks. Their Muslim population has further aggravated this situation by taking loans on interest to finance their requirements as well as in their engagement into luxuries that Allah has prohibited.

Muslims have failed to take heed of Allah’s prohibition upon interest and have attempted to justify, against Qur’ânic dictates, that they have economic justification for foreign aid that has to be paid back with interest.

Muslims must now reflect, abandon sinning and re-adopt Islamic financing techniques to elevate their economic position.

Rationale of Foreign Aid

The need for foreign-aid on an interest-basis would be assuredly substantiated by those who promote it; through theoretical terms and economic interpretations to prove its positive result in the pragmatic domain. This postulation is however still in conflict with Allah’s order.

Recipient Muslim countries must adopt policies that reduce their dependence on foreign-aid and direct their country towards self-sustaining growth. The role of foreign-aid cannot be denied. It has positive and negative effects.

Proposed strategies to be fore-planned for the negative effects

  1. Financing needs only and only according to Islamically allowed contracts.
    1.1 Contracts with foreign countries, foreign banks and financial institutes should be in strict Islamic terms.
    1.2 Provision for lateral and bilateral breach of contract.

  2. Mobilise domestic savings.
    2.1 Encourage investment into Islamic Banks that conform to Islamic principles.
    2.2 Encouraging savings by placing limits upon resource utilisation
    2.3 Rural and national development

  3. Development of a proper taxational structure.
    3.1 Prevention of tax evasion.

  4. Creating the infrastructure for
    4.1 our own technological development
    4.2 productive investment
    4.3 ensuring appropriate privatisation or nationalisation.
    4.4 favourable foreign investment policies
    4.5 expansion of exports

  5. Appropriate fiscal and monetary policies
    5. 1 Governing foreign remittances.

  6. Prevention of the brain-drain

  7. Reduction of unemployment.

Foreign-aid is not against the Islamic spirit, but the use thereof and the manner of such aid must not violate Islamic teachings. We require foreign expertise in many avenues. This does not imply that we must strangle the economy by aid that provides investment opportunities for a given class of capitalists but actually places a burden upon the entire nation that does not truly reap any fruit of such aid. our religion is not segregated from our economy.

Foreign-aid, when taken on Islamic principles would prevent problems for the balance of payments account as well as relieve savings for non-productive public infrastructural expenditure.

However, such aid should not be attached with other strings (i.e. tied aid). e.g. the purchase of goods, etc. from the lending country at prices that are higher than world market prices, for example, some U.S. Aid programmes require the recipients to spend the aid on U.S. exports, which are also then subsequently overpriced.

Neither must the recipient country be obligated to exchange rates that are against the real rates or to any other biased policies in favour of the lending party.

Article Consulted

Ahmed, Salman, and F.M. Irfan Chaudhry. “Economic Development and Current Situation in Pakistan: Role of Foreign Aid.” Pakistan Banker Jul. -Dec. 1991: 31-39.

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Media Ignorance

The Media Is Ignorant Or Desires To Remain Ignorant Of Islamic Economic Issues

The Media

The various media serve to be the people’s informational source. Words conveyed must be a trust that should be truthfully conveyed and relayed, since truthfulness is an obligation. Those that address the public are held responsible to rely upon facts and not hearsay. They must comprehensively and indepthly understand all issues and relations to the subject matter. Their material must be distant from being a surface treatment and from misconceptions or accusations that are void of acceptable proofs.

Islamic Economics

Islamic economics is not restricted to the prohibition of interest only. It also relates to the specification of avenues into which investment is made as well as the extent thereof. All other economic concepts are part of its system as well. The Islamic economic model is formulated by Allah, mankind’s Creator, He who has fashioned the rich and the poor. He is our Sustainer unto whom belongs not only the materials of production but also the manufacturers, the cultivators and all the middlemen. The economic model designed by Him is therefore perfect and does not admit of deficiencies which will necessarily be found in all models formulated by the human mind. This is because Allah fully understands human needs, not only those that existed in the past, but also those that would exist in the distant future.

The task of Islamic economics is neither the sole responsibility of Islamic banks or a group of Ulema. This is because development, employment, social structuring and controlling the financial resources of a country are all economic issues planned at government levels. Also because the implementation of Islamic economic principles is mainly executed within trading circles.

Business economics pertains to the use of scarce and limited resources for the diverse and ever changing unlimited needs of the human race. Islamic economics however pertain to directing these resources firstly for necessities that should not be against the dictates of the Shariah.

It is our predicament that Muslims speak much more than that which they practically do. Dr. Yusuf A]-Qardaawi once expressed his pain after having read statistics confirming that the average working hours of certain Islamic societies is only 27 minutes a day. How can an Ummah, filled with laxity, rise under the shade of such grievous unemployment in Islamic countries and within other Muslim groups.

Individuals are responsible for their own progress and should monitor their own deeds by themselves. External supervision ought to only be for directive purposes. The accountant as well as all others are responsible for work time, the tasks and duties given to them and for the properly of others that is placed in their trusts. Islamic economics is therefore a science infused with Islam’s ethical requirements as well.

The application of Islamic economic principles, especially in non-Islamic states, is only a minor exemplification of certain sectors of the Islamic ideal and to therefore promote it until full growth, is not only better than neglecting it, but is also an Islamic obligation.

Interest-based Financing

Interest-based financing requires greater security from the client.

It necessitates the borrower to make a higher profit, in the case where the loan is not of a consumptional nature but rather one that is investment related, in order to service his interest debt.

The demand for money on interest leads to an increase in inflation, which in turn causes the currency in a highly inflationary market to lose its purchase value in proportion to the rate of increase in inflation. This subsequently causes a further increase in the production costs thus raising the costs of produced goods to a level that the market sustains. At this point a reduction in demand is possible in certain sectors and could thus mark the entry of the deflationary spiral or, on the contrary, even introduce stagflation, i.e economic stagnation and inflation together.

Zakaah

The Zakaah obligation, if discharged by currency. places more purchase power within the hands of needy consumers. These people would necessarily spend any Zakaah they receive because of their poor financial position. Their spending also increases trading activity in the areas where they spend their monetary means.

Discharging Zakaah also saves the State. to some extent, from providing aid to its recipients. Where Zakaah is given in kind, it also lowers the storage costs for people, especially the business class, if the quantity of the Zakaah is large.

Islamic Banking

Islamic Banks are subject to negative aspects. This is because of the age-old stagnation regarding the development of such banks. These aspects, with exceptions, should not be a cause of targeting it, or the reason for which the entire Islamic financial model is criticised.

The West were very eager to hear that Islamic Banks be ultimately unsuccessful. They awaited that moment, but were grieved to hear that these banks continued to progress and expand in size and number. They thus, sought avenues to halt its motion.

They also accused such banks of not being totally Islamic in order to destroy the Muslim public’s trust. Gullible Muslims then set forward to 5~ against the banks, despite the fact that they themselves continued to deal with fully interest-dealing banks. What form of justice is this?

It is necessary that Islamic banks, Islamic insurance companies, etc confess any negative aspects within its operations and systems as well as eagerly work to remedy the prevalent ills therein.

Details extracted from: AI-Halwaani, Basyooni. “Tajaahool I’laami Li Qadhaayal Islaami [The Media’s Feigning Ignorance towards Islamic Economic Issues].” AI-Iqtisaad-ul-Islaami, [Islamic Economics] Feb. & Mar. 1994: 11-15. Published by Dubai Islamic Bank.

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A Drain by Emigrating Brains

Islamic States suffer from a shortage of technological development. These States have however, despite such a deficiency, continued to stand extremely behind the progress and development that is taking place in the non-Muslim East – West. The Ummah also continues to lose intellectual brains in the fields of engineering, medicine, chemistry, physics, agricultural technology and other fields. These scholars are lost to the favour of the countries to which Muslim intellectuals emigrate in search of higher standards of aesthetic amenities and educational and work prospects for the family.

The Ummah is then deprived of all the efforts and costs that were borne to create these scholars. Due to migration from Islamic lands, the rare expertise of these intellectuals is lost to the reins and culture of the West. This then also aids the non-Islamic sector to excel in its technology while the Islamic sectors suffer from scientific development.

What are the reasons? To what extent does this phenomenon take place? What factors can be used to reverse this situation? Which economic forces can be adopted to use these intellectuals’ strengths to uplift the Ummah to the required standard of technology? Technology is a foundational requirement for industrial development, which in turn, is the pivot for economic control.

Islamic States do not Appreciate Intellectual Capability, The Latter have therefore Found Recognition in Other States

Most Muslim intellectuals left Muslim countries by their own will. They were needed and therefore welcomed by other countries. It is also astonishing that 15 Egyptian nuclear specialists teach at the National Arizona Institute that is one of the most acclaimed of American institutes. We do not have definite statistics on this drain in every faculty. However, foreign statistics have given us a good indication of the case at hand, e.g. Arab doctors form 30% of America’s medical practitioners, while 18% of its engineers and 10% of its biologists are also Arab.

There are also indications that 100 thousand graduates of the third world have migrated to Europe, America and Australia. Most of these migrants are from Arab & Islamic States. It is indeed shocking to know that most of the scholars are those who specialise in the fields of science and technology. America and most European states preferred the migration of these scholars and provided them, not only work opportunities, but also national rights and citizenship.

Despite migration, Muslim scholars do not have any effect in the political decision making of those States to which they migrated. This is due to various factors, e.g. absence of co-operation between the very Muslim scholars, indifference towards politics and Islamic affairs, fear of the loss of opportunities that they enjoy or strategic placement by the controlling authorities so that no Islamic cry is ever heard.

Jewish scholars, despite being minorities, are on the contrary, always found to have a say in the political affairs and decision-making process for the organisations for which they work as well as in the countries that they select for residence.

Arab and Islamic States easily permit the migration of Muslim intellectuals while a state like Israel welcomed the procurement of scholars from Russia and Eastern Europe after the collapse of Communism. The Jews have pre-planned the reception of required intellectuals for the political, technological, economic and educational development of their countries.

Progressive States have 92% of Intellectuals, Only 8% of the latter Exist in Developing Countries

Islamic States do not encourage research and scholastic output. Intellectuals are therefore obligated to migrate in search of knowledge. There cannot be industrial output and development without technological progress which is a tool for strategic activity in the political and economic sectors.

On the opposing field, the far-eastern states spend a considerable sum of their budget in attaining scholastic research. America spends an extremely high amount for development. This is the backbone of its leadership. Islamic states, very pathetically, only spend 0,2% of their G.N.P. in research and development. Therefore, expenditure by each Muslim for the latter is 300% less than their counterparts in the progressive states.

Sometimes older technology is not very different from the latest technology. This is because each of the latter is a development of the former and was also initially dependant thereupon. Our Ummah suffers the fate of importing or copying technology. It therefore fails to acquire its very own capabilities and places itself in danger of ignorance and dependence upon foreign expertise. This gives the clear indication of the indifference that it holds regarding the development of its own technology. Copying technology and scientific advancements will not place us in the age of advanced high-tech. This does not imply that we must not acquire all foreign achievements, since this is also necessary and is at times the product of united efforts. However, we ought to be enabled to exploit and benefit from all avenues. Information and resources attained and achieved must be politically and economically beneficial without detriment to our religious, cultural, social and moral lives.

It is true that precedence in the fields of technology will not be achieved except by those who can generate new ideas and innovate not only concepts but practically create new utilities. This ability is impossible to obtain through idleness. The result of scholastic research is only attained after a long period of continuous effort, perseverance and persistence by keeping in mind the final objectives of achieved developments. It is also necessary that such research be integrated with practical and meaningful application for productive purposes.

Misunderstanding

We have to realise that the Arab and Islamic society despises the intellectual and views him with the eye of humiliation. Wealth and power are the only issues that have now become the main attractions for the Muslim society.

Many intellectuals left Islamic countries without owning anything. We have also heard of rare specialist scholars who are proficient in the most dangerous and important of sciences to have been found killed or slaughtered. Not even a whisper was heard concerning their deaths. Neither was anything mentioned in the media. On the contrary, the entire world is in uproar and fails to sit upon the death of an artist or soccer player. People buzz with such news; as if a major catastrophe has befallen us. No one is hurt by the death of an Islamic scholar. No matter how low be the qualifications of a foreigner or non-Muslim, he is always considered the best in the eyes of a Muslim. This has therefore resulted in enmity since Islamic scholars find others to have always been given preference in their very own countries. This has also enabled such non-Muslims with opportunities to excel. Other states ensure job availability and opportunities for its labour forces that have been nurtured from childhood, protected and educated. Non-Muslim States give their scholars every opportunity to use their strengths and experiences as well as to best exploit such faculties.

Arab and Islamic States also suffer from the disconnection of practical application from the education that it provides its youth, e.g. Arab students in the engineering faculty study imported books, the contents of which are irrelevant for application in their societies. They very seldom know about happenings and developments in their countries since 90% of all major investments in their countries are given to foreign companies.

Despite all negative factors, which need to be remedied, Muslim intellectuals cannot always justify their migration and escape from the fields in which they are direly required. We ask them in the most humble sense to return to their countries and to participate in its development. The recent years that have passed have shown a new trend towards favouring scholastic research. Many Arab governments have now begun to increase budgets for scholastic research, universities and research centres. The future projects itself to be brighter than our past.

Bad Planning

Some academics believe that Muslim intellectuals emigrate because they find themselves to be sitting in a strange world that is distant from the type in which they wish to be existing. Some or many Islamic countries do not place graduates and appropriate people in appropriate positions and in fields of their specialisation. It is not rational to place a scholar who has specialised in biological sciences or chemistry in areas of agriculture that are remote from any relation to the two given sciences.

Educational institutes and respective authorities in the administrational sector are also responsible and should bear the necessary tasks in the preparation of Muslim scholars to harmoniously blend their education with utility and application in the societies that they live. The institutes must not deprive the students from acquiring the most needed qualifications of our times. This is for the very benefit of the Islamic society. There are many and diverse types of examples, e.g. we failed to use the expertise of Farouk Al-Baaz, an Egyptian Scholar, who later achieved many academic awards for America.

It is therefore necessary to increase the educational fields as well as the employment avenues for educational qualifications in specialised fields.

It cannot be acceptable that a scholar who excels in nuclear engineering returns to his Muslim country only to sit in an office and administrate or supervise over a group of employees who serve a task totally different from his field! This is the unfortunate plight of many. The latter are thus forced to emigrate to the West where they find every aid to develop their talents and abilities as well as realise their intellectual desires.

In conclusion, the beneficiary is always the society in which such scholars live and the students who are enabled to study under them. Dr. Abdur-Razzaak Sairafi, a science teacher at the Cairo University, once quoted a Muslim intellectual who specialised in nuclear engineering. The latter said that most of the students who studied about nuclear weapons under his tutorship were Jews. Can we now accuse this Muslim academic of betrayal since he allowed Jews to benefit from his knowledge and experience in the field of nuclear power since they would exploit this science to harm the Muslims? Can we level any accusation against him if knowledge is the joint property of every human and because he provides a service to earn an income? The abundance of Jewish students is through the University’s approval and not due to his acceptance. We must indeed rebuke our universities for the inability and failure to procure the like of these specialists, especially those who have such rare specialisation. Sadly, Islamic universities and institutions have abstained from giving him the necessary aid and tools to help the Islamic society in the area of his specialisation.

Help them instead of Crying after Witnessing the Distant Hills

A teacher at Alexandria University had expressed that political, economic and educational conditions are major factors governing the choice of a Muslim scholar. There are examples of Muslim academics who emigrated to other countries under pure political pressure or repression. There are those who migrated for pure economic reasons that do not pertain to academic affairs. There are others who have not found intellectual posts that concord with their specialisation. They were therefore compelled to search for appropriate posts in one of the western universities. The examples are many.

We, instead of crying later, must now obtain benefit from the experience and abilities of these scholars who have shown their academic excellence. Presently, there are numerous distinguished research scholars in various specialist fields, especially in the fields of rare research relating to the needs of Islamic societies. We must create a bridge of co-operation between these academics and our research institutes. Subsequently, we would benefit much from the efforts of these scholars, some of whom have prepared dissertations and theses or supervise students undertaking research in the various departments. This requires good co-operation with them and appropriate modes of benefiting from them and their academic efforts.

Muslim academics who have migrated to the west are not a total loss to the Islamic World. They would become good messengers for our countries as well as a means for increasing their intellectual standards. This however requires that we develop an appropriate plan to link them to their countries.

Let us now end the stream of accusation against emigrant Muslim minds and revert to establish a relationship. Muslim academics have, in most cases, not ended their relationship with the Islamic world.

Islamic societies have recently, constantly pursued the acquisition of intellectuals, intelligence technology and technical ability. The west and the non-Islamic world have placed limitations and specifications regarding their technology exports to the Islamic world. This is only one link in its strategic chain to keep the Islamic world ideologically backward and culturally decadent. This will ensure that these states remain backward and incapable of being a threat to them, either economically, politically or militarily. We have already witnessed and daily continue to see that the west considers the industrial and cultural awakening of the Islamic world as the arising of an enemy that would harm the western world and its economic interests. The Islamic world, however, not only consumes the products of the western world, but now also consumes its culture, its industries and ideologies.

It has now become obligatory for Islamic States to take measures preventing this brain drain. However, this cannot be executed if the so termed “Islamic State” is not “Islamic” in the true sense. And if it is also totally incapable of giving Muslim intellectuals in the country any appropriate alternatives with suitable payment according to their profession and needs. Stringent restrictions should be placed upon students who are sent to foreign countries to receive education or even those who are educated in local institutes.

Presently, many scholarships and grants given by institutes and companies in Islamic States are accompanied by conditions, for example, working for the company for a fixed period so that it benefits from the experience gained by their delegates. Muslim governments can however specify many other conditions, viz.

  1. Working in the same or other Muslim State for a fixed period.
  2. Training Muslim students in Islamic States for a fixed period.
  3. Providing academic material for Islamic Universities, institutes, or organisations for a fixed period. The academic material can either be translations that are required, individual scholastic research or the completion of delegated research projects that may be for companies, the government or any of its associate organisation or bodies.
  4. Corresponding from foreign states to Islamic States and providing material, in the various divisions concerned for a fixed period.
  5. Other conditions and specific details for each condition however require to be meticulously drafted.

There are other procedures and steps that could also be adopted to encourage their participation in the building of the Islamic Economic Bloc, e.g. raising their living standards and increasing salaries of specialist scholars at our universities. Politics and favouritism must be eliminated from our universities. It is necessary that we re-organise our house from within before placing the blame upon others.

Resurgent Minds ……….. Are Most Important

We must dissociate ourselves from old customs that stand as an obstacle to intellectual progress and technological development in our so termed “Islamic” countries.

Muslim academics have developed in the West because it has proliferated tools for such development and accorded them the required aid and opportunity for progress as well as secured their economic well-being. Many Muslims of meagre economic well being and intellectual status have indeed reached remarkable positions due to their migration from Muslim societies.

Since we cannot reclaim most of the emigrant Muslim minds, we therefore have to re-position ourselves. Re-structuring our strategy for producing, maintaining and protecting the intellectual requirements of the Islamic society is a vital duty and an urgent task of Islamic economists.

The new generation must be encouraged to research, study, innovate, develop and excel. They must be given all the intellectual and technological resources to continue with the new blue-print. They will represent our future hope since we cannot waste our time by being occupied with those who have been nurtured in the West and who enjoy sitting in the lap of the non-Islamic society. The latter have already deeply cuddled themselves within the bosom of their masters and would hardly return to Islamic lands. Their first bond of allegiance is not Islam and would most likely never be. This is since the countries where they received their education and where they were nurtured are now also the same which feed their stomachs and satisfy, by amenities and pleasures, their aesthetic requirements. Their souls have now lost all bearings that might direct them to worship the Kabah’s Sustainer. They should not be neglected but approached in the hope to benefit from their experience. Allah guides whomsoever He desires to His path.

Re-Organising The Market Structure In Islamic States

There are very strange market forces in the Muslim States and unfortunately, the greatest amount of theft, corruption and bribery. These factors lead to the outflow of Islamic brains and the deprivation of Islamic societies from their intellectual ability and experience. Muslim countries, due to the loss of their elite, pay a high economic cost for all imported technology that they will be constantly obligated to buy until the re-structuring of their industrial power.

Muslim states also import unemployed labour of foreign countries. Such migrant labour received from Europe and Asia was often futile to those countries but was accepted under the claims of lower costs. When necessary, such borrowed labour is not negated. However, no attempt is made to train the available personnel within these states. This labour that immigrates to the Islamic countries, exports their income to their home countries. These states thus face a further drain of monetary resources.

Another dangerous element relating to the importing of labour, besides the non-creation of internal expertise, relates to racial and nationality discrimination. Arab states, unfortunately, do not see Muslims from other countries as fellow Muslim brothers, but rather view them as nationals of other countries. Arabs despise Muslims from other countries and do not accept them as part of the Islamic brotherhood. According to these Arab nationalists, such Muslims must find their own solution to living in Arab countries and should not interfere or bother about Arab politics.

According to these Arabs, it is therefore praiseworthy to employ a European Christian instead of an Australian Indian Muslim, even though both of them have the same qualifications. Others have shown their love for the west to such an extent that employing a Jew is better for them than employing a Muslim who may have a higher qualification.

Muslim States are therefore different from true “Islamic states” and Islamic economics is viewed as a science to be applied only in Arab states. No consideration is given to Non-Arab states like Pakistan, Afghanistan, Indonesia or Malaysia. Neither is any consideration given to include Muslim minorities in the global Islamic fraternity, nor are their needs and interests catered for.

Non-Islamic labour includes Muslims who have no Islamic interests and as such flagrantly violate Islamic injunctions. It also comprises of Kaafirs (disbelievers) whose life pattern, social behaviour, economic and commercial transactions, dressing, culture, ideology and behaviour totally conflict with the religious injunctions of Islam.

Giving the aforementioned class of people the right to live as they please, destroys the entire fabric of the Islamic society. This results in Muslims walking naked on the beach and Muslim women unveiling themselves in the streets of Islamic countries. Muslims then enter freely into bars (e.g. Casablanca, Morocco, 1995). The doors of prostitution are then opened and all efforts to rescue such a society are a failure. Crime then penetrates the Islamic world and justice becomes difficult to execute. All the satellite dishes then only receive the sick culture of the non-Islamic World.

Some states received Muslim academics because their youth were found to have lost interest in higher and tertiary education. On the contrary, Europeans and non-Muslims from other parts of the globe find it easier to obtain work opportunities in Arab States. These countries receive very little information and technical benefit from them.

The longer Muslim academics live in foreign countries, the more difficult does it become for them to return to their home country. We must therefore scan and eliminate all factors that prevent their return. Marriage is also among the vital factors. Many youth have married non-Muslim spouses and have had children from such marriages. Their partners have thus had influencing authority or absolute authority in their locational decisions. Others have found life in the west enjoyable due to open sexual amenities to which they have become addicted. The loss of Muslim academics to the non-Muslim or non-Islamic world meant the failure of the Muslim world’s economic planning. This aspect therefore attacked the advancement of the countries that delegated and supported them.

Loss of Muslim intellectuals meant the loss of Muslim leaders. This then meant that the Ummah grouped without necessary direction from the expertise of its scholars. The micro-economic scene was thus filled with chaos that prevented macro-economic stability of the state. It was thus obligated to become dependent upon foreign expertise.

Technology has proven itself to be the bridge for progress and development. Its effects are also witnessed in the administrative and social sectors. Our natural resources require to be used and strategically exploited for our benefit and not be considered as cheap deposits for export.

The following factors could be added as reasons for driving away Muslim academics:

  1. Severe internal circumstances and instability
  2. Backward social and economic conditions
  3. No political control over labour and employment
  4. Low salaries
  5. Aesthetic living conditions
  6. Backward educational and other outdated public services
  7. Unstable employment relations

Factors that promote intellectuals and academics

  1. Freedom of thought
  2. Political liberation and freedom
  3. High salaries
  4. Aesthetic living conditions
  5. Diverse work opportunities
  6. High levels of technological and educational development

We can imagine the manifest danger of the drain on Islamic countries by considering the ability of each outstanding academic who changed the course of history, e.g. Albert Einstein, who produced the atomic bomb that led to the Allies’ victory and Japan’s subjugation. Likewise, the discovery of penicillin created a revolution in medical biology.

It is also an acknowledged fact that economic development is dependent upon obtaining technology that is not easily obtained since it requires skilled professionals to operate and experienced hands in the relative technologies, which at times have never ever been delivered to Muslim hands. Thus the import of certain technologies obligate Islamic countries to concurrently import migrant labour at high costs from states that provided this technology. This is then the opposite reflection of importing needed technology.

Technology advancement has had the following negative influences on the Ummah:

  1. It created a new breed of colonialists who hoard technology to control developing countries and prohibit development therein.
  2. It deeply rooted the concept of keeping others subjected.
  3. In view of the absence of expertise in the states that were provided with any vital technology, it controlled the use of such technology by using informed experts and supervisors to monitor the export of technology and use of equipment.

Permanent And Temporary Migration

Studies have exposed that migration occurs in the following two modes:

Firstly, permanent migration: The Muslim migrant permanently takes residence in the host country either by obtaining nationality, work permits, permanent residence status, getting married in those countries or taking his family with him. Arab professionals and artisans count for more than half of the migrants to America.

Secondly, temporary migration: This migration is due to short or limited periods of employment after which the emigrant returns to his home country. This form of migration should also not be seen as void of harm since the emigrant spends years of hard labour during his youth or the better part of his life in which he possesses the ability to be creative.

Migration mostly takes place to progressive and developed countries, especially to America and Western Europe. Migration is therefore to selective states and specific fields attract higher migration than others. It is also noted that this migration increases yearly in proportion to the number of emigrants.

Unlimited Losses

Migration or Hijrah causes the following harms:

  1. Economic obstacles that stand in the face of social and economic progress due to the absence or loss of professionals. Islamic states thereby lose human capital of a higher standard that plays a vital and primary role in development.
  2. Monetary losses which Islamic countries have to constantly bear for continued education in the west. These countries therefore found the ability to produce labour at the cost of Islamic countries.
  3. Medical costs and the loss of production due to the absence of appropriate medical services and the migration of doctors, medical technologists, dentists and others in the same or associate sectors.
  4. Social and cultural losses which are reflected by the society being deprived of the services that the above class would have been able to provide.

Linking Scientific Institutes to the Reality of Life and the Benefit of the Sciences

  1. Organisations and institutes in Islamic states must now draft plans for development and higher institutes of learning. It must undertake appropriate economic and administrative studies. The required faculties and associated equipment must be provided and continually updated.
  2. Providing better salaries, benefits and incentives to reward their activity.
  3. Providing an abundance of material in the various fields related to the needs of the practical market. These materials must be placed in the easy reach of the graduate students.
  4. To place the appropriate person in the appropriate place in conformity to his specialization, his desires and his ambition. Also, to rely on the ability of an individual so that this be a means for his advancement.
  5. To benefit from scholastic research to solve the problems that face the society and our economy.
  6. Respecting knowledge, Islamic scholars and giving them freedom of thought and innovation within Islamic boundaries, as well as protecting scholars from the negative factors that influence them.

Extracts from an article by Basyoony Al-Halwaany Haaziem Ajoor in the magazine “Al-Iqtisaad-ul-Islaami” No. 154.

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Economic Control

The non-Islamic Powers have due to Muslim laxity, gained control over natural resources and its utilities. They have therefore developed a physical army that is presently totally beyond the poor, outdated and borrowed technology which. Muslims have purchased from the very same powers. lie latter have through research, meticulously planned operations, etc. within the various economic sectors, enabled themselves to not only control the utilities of these resources, but also the avenues in which these are used.

Due to Muslims discarding the orders of Jihad and neglecting the need for progress as well as erroneously regarding economic advancement to be against Islamic teachings, the non – Muslim powers colonised fought or gained economic control of Muslim countries. Even after the independence of such countries, the main economic elements are still within the hands of foreign groups.

Muslims, whose lives are to be the most peaceful, now have politically unstable countries. Muslim states, let alone economically planning the strategic use of their resources, neither have mutual unity nor co-operation due to which any strategy planned for its growth is eventually unsuccessful.

It is always the west that proceeds to establish unity among their states. The EEC and all its ramifications relating to commercial co-operation and monetary union are major issues that demand the attention of Muslim economists.

In the very early era, after the Muslims were finally conquered by foreign powers which imposed their own form of currency and robbed the Ummah of its pure metals.

The Ummah discarded its monetary system, and was thus compelled to adopt a foreign system with the ills of the fractional reserve banking system. The Ummah failed to finance and support scholars who could have been selected to develop the Islamic monetary system so that a pragmatic theory of proper exchange rates, that is acceptable in the Islamic economic system, could also be developed. Because of this absence, the economic system of the capitalistic west or the communistic east which partially backed its currency with precious metals or used other modes, was also adopted in Muslim states. The market values of these metals, used for backing, fluctuated; but no corresponding change was effected in the amount of paper currency that was placed in the economy. Rather, other economic variables were applied as the determinants for the circulation of a further print of money or for the reduction of the money (paper currency) supply. The main variable, in this context, was the demand for money, which in turn was based on the extent of produced goods that were supplied for public consumption.

In fact, some countries had no backing by precious metals. but rather by foreign currency. it is even more surprising that the Swiss continued to keep their currency highly backed by gold, despite the Bretton Woods contract (1944) under the United Nations.

Muslims were therefore entangled into the study of this system and had to conform to the methodologies by which it operated.

Muslims cannot conceive to wage an economic battle against the west or any other power since their countries totally depend upon foreign technology. ‘Re Ummah has, with minor exceptions, shown no earnestness to exit its degenerative state.

Islamic countries are restrained from economic control due to the following factors, which must be attended to, for any meaningful domination of the Ummah:

  • Islamic states provide less than 8% of the needs of non-Islamic economies. The latter economies can even reduce this low figure.
  • Much capital from Islamic states is invested in non-Muslim enterprises and interest-dealing banks of non-Islamic States. This leads to increased development in such states while the Islamic countries fail to benefit from such capital for its own infrastructure] development. Islamic states import more from the non-Islamic countries, than that which their GNP can support.
  • Not a single Arab – Islamic or non-Arab – Islamic state has the technological competence to give it any competitive edge in production or export.
  • The total lack of foresight amongst Islamic countries to unite and create an economic bloc that would control the Ummah’s resources.

Published by: Madrasah Arabia Islamia, P.O.Box 9786, Azaadville,1750, South Africa

 

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