Australia Urged to Embrace Islamic Banking

Australia Urged to Embrace Islamic Banking

Australia has tried to implement the Shariah compliant methods of financing into the country and are encouraged to embrace Islamic banking. Islamic banking could help the Australian Government overcome infrastructure funding shortfalls, an Australian finance head says. The head of Australia's first Islamic finance company, Talal Yassine, met with government ministers in Australia's capital, Canberra, this week. "We are not bringing Sharia law in any way to Australia," he said."Islamic investment principles are all about value and conservatism and about investing in worthwhile things that are ultra-ethical - and I think I should be extraordinarily clear about that, there is nothing to fear here". Mr Yassine said Islamic investments avoid debt."It does not use the concept of interest and money making money," he said."It is more of a joint venture kind of approach and it avoids moral hazard investments - tobacco, alcohol, the gambling, armaments. "And basically it is a really conservative way of investing for value without using any sexy financial engineering that we've seen so much of and which has caused so much damage in the current world economic environment". But Mr Yassine said some changes could be made by the Australian Government to encourage Islamic investment in Australia.Mr Yassine said a simple example would be that in Australia a financial organisation needs to quote an interest rate to lend money, but Islamic financiers don't charge interest. Mr Yassine said making some changes to allow for the differences in Islamic banking would benefit Australia."The Islamic finance industry is worth at least $US1 trillion and growing at a very significant rate per annum," he said."And if we had a tiny slice of that, a one per cent, we are talking about multi billions of dollars".