Full Speech
Mr. Andrew Morgan and Mr. Andrew Tebbutt, Islamic Finance News,
Prof. Emeritus Datuk Dr. Osman Bakar, Rector, IIUM,
Mr. Charles Haresnape, CEO, GateHouse Bank,
Dr. Khalid Khalafalla, CEO, ICIEC,
Datuk datuk,
Distinguished guests,
Ladies and gentlemen.
Assalamu’alaikum warahmatullahi wabarakatuh, and a very good evening.
- I would like to thank IFN for inviting me to address this audience of Islamic finance practitioners tonight at the IFN Awards Ceremony. It is indeed my honour.
- I would like to commend IFN for its foresight in recognising the immense potential and wealth of opportunities underlying Islamic finance.
- Tonight’s awards are not a celebration of individual achievements, they are confirmation of the collective ambition and dedication that has propelled Islamic finance forward, transforming aspirations into tangible impact.
- Global Islamic finance assets are currently close to US$5 trillion and expected to rise to US$7.5 trillion by 20281. This translates to an annual growth of 8.9%2. Within this context, Malaysia’s Islamic capital market stands at US$583.11 billion (RM2.6 trillion) as of November 2024.
- Just a few days ago, I was in Penang, attending the ASEAN Capital Market Forum Chairmen’s Meeting. We discussed our ambitions, challenges, and ASEAN’s attractiveness as an investment destination. Amid these discussions, one particular point stood out to me – despite our differences, there is recognition that Islamic finance can be an example and driver for inclusive and sustainable growth.
- As I look around this room filled with industry leaders, Islamic finance pioneers, and innovators, I realise that this conversation does not stop in ASEAN—it is about all of us. Because the challenges we face are not regional – they are global.
- Islamic finance has come a long way. But are we truly harnessing the power of Islamic finance to address the world’s most pressing challenges?
- Consider this:
a. Last year the World Bank reported that about 712 million people worldwide still live in extreme poverty, surviving on less than US$2.15 per day3.
b. Many reside in regions highly susceptible to climate change, largely Sub-Saharan Africa, South Asia and East Asia and the Pacific3.
c. Two-thirds of the world’s extreme poor rely on agriculture for income and food security, increasing their vulnerability to extreme weather, rising temperatures, and environmental degradation3. - These statistics represent millions of lives impacted by challenges that transcend borders. And, as the World Bank reminds us:
“The goals of ending extreme poverty, boosting shared prosperity, and ensuring a liveable planet are closely interlinked.” - principles of justiceIslamic finance, rooted in principles of justice, equity, and social responsibility, is uniquely positioned to provide solutions. But we must be bold in our offerings — for example, how can we use Islamic finance to fund our climate adaptation needs or for post-disaster recovery, or galvanise communities and savings schemes?
- The good news is that we are already seeing promising developments: Green and Sustainability Sukuk have gained strong momentum. In 2024, more than US$15 billion in green, sustainability, and sustainability-related sukuk were issued globally4.
- We are also seeing new markets rising to meet these challenges —from ASEAN to Central Asia, and Africa to the Middle East. For example:
a. Egypt’s US$700 million financing deal with Islamic Trade Finance Corporation (ITFC) to strengthen food security.
b. Kazakhstan’s Astana International Financial Center (AIFC) partnerships with NASDAQ and the Shanghai Stock Exchange, towards enhancing liquidity and connectivity in Central Asia. - These initiatives are encouraging. They ensure that the estimated 8.9% annual growth of the global Islamic finance industry is poised to uplift economies, empower communities, and create real impact.
Islamic Finance is a System Built on Values
Ladies and gentlemen,
- The awards tonight remind us of how much Islamic finance has grown. Excellence is being recognised across the spectrum—from Islamic banks, sukuk, to venture capital, takaful, and fintech.
- But we must not forget:
Islamic finance is not just an industry. It is a financial system built on values.
- Maqasid al-Shariah is at the heart of this system—ensuring that every financial product and service aligns with principles of justice, sustainability, and inclusivity.
- In 2023, the SC took a significant step forward by introducing the Maqasid Al-Shariah Guidance for the Malaysian Islamic Capital Market, embedding these principles into Islamic financial products and services. As of 2024, more than 20 sukuk issuances have adopted the guidance — and from my discussions with industry leaders, this number is set to grow in the near future.
- But now, we stand at a crossroad. Projections alone do not guarantee success. The Islamic finance industry must take decisive actions to stay ahead.
- As regulators, we constantly ask ourselves how to expand the breadth and depth of the capital market. And so, while you enjoy your dinner tonight, I invite you to chew on these pressing questions we have been grappling with:
a. Are we truly fulfilling Maqasid al-Shariah if we overlook ageing populations, pension gaps, and retirement security?
b. How do we leverage Islamic finance to mitigate climate risks and extreme weather?
c. How fast can we accelerate the adoption of AI and technology by Islamic financial intermediaries to improve efficiency and access?
- These are fundamental to our future. And the conversations we will engage in— are not just among ourselves, but with other regulators, stock exchanges, and industry players worldwide.
A Call to Action: Let’s Lead, Not Follow
- In closing, I would like to reiterate that Islamic finance and sustainability are not mutually exclusive, but rather complementary aspects of our financial ecosystem.
- The global demand for responsible stewardship and ethical investment has never been greater, and Islamic finance is well-positioned to lead this charge.
- Tonight, we have served up recognition as appetisers and a thought-provoking main course. Now, as we move to dessert, I will leave you with three final questions to digest:
a. Are we satisfied with where Islamic finance stands today?
b. Are we thinking boldly enough about the next frontier?
c. Are we truly pushing Islamic finance to play a central role in addressing the world’s most pressing challenges?
- The world today in my view is not just looking for alternative finance—it is looking for better finance. I have tasked my colleagues at the SC to look ahead to the next 10 to 20 years. As we develop our future outlook and perspectives in the Capital Market Masterplan 4, we will be addressing these questions head-on. And hopefully contribute to not only our progress as a nation, but as part of a global movement.
- To the organiser, sponsors and partners who have made this event possible, your dedication to promoting Islamic finance is exemplary and we look forward to working together in the years to come.
- To end, let me again remind you that we are now at the point in history where we all need to do more to help one another. And Islamic finance has a role to play.
Thank you, and I wish you all a great evening.
