HE Mohammed bin Abdullah Al Jadaan, Minister of Finance, launched on Sunday, November 1, 2017, the Second Scientific Conference for Islamic Finance Research at King Fahd University of Petroleum and Minerals in Dhahran, Eastern Province.
HE the Minister of Finance, at his opening speech, expressed that he is so pleased to participate in sponsoring this conference, pointing out to qualitative transfer witnessed by the Kingdom in the vision of 2030, stressing that the implementation of the vision, very well, depends on the implementation of comprehensive financial and structural reforms. And this is what the government has done and is being doing according to the instructions of the Custodian of the Two Holy Mosques King Salman bin Abdulaziz Al Saud.
HE the Minister goes on to say that the economic reforms will contribute to raising spending efficiency, diversifying the sources of government revenues, supporting the non-oil revenue base and continuing to control the public finances. HE points out that the theme of the conference is in line with the vision of the Kingdom of Saudi Arabia 2030 and with accordance to its financial programs, as this conference discusses, in the field of research, one of the most important topics dealing with the economy, namely financing that is compliant with Shariah, noting that the importance of Islamic finance lies in enhancing stability, financial and sustainable economic growth, if the work is aiming to develop its products. HE goes on to call on academic researchers, in the Islamic finance industry, to conduct their academic research with high quality, relevant to reality, and based on actual practices in the markets, dealing with many challenges facing this Industry.
The Government of the Kingdom, represented by the Ministry of Finance, has established by the end of 2015 the Office of Public Debt Management Office as one of the national transformation initiatives. The most important work of the Office is the establishment of two international and local Sukuk programs. He pointed out that international Sukuks of the Kingdom of Saudi Arabia were put on the international market for the first time with a value of 9 billion Riyals for 5 and 10 years. Three issues have been offered, to date, for 5, 7 and 10 years, worth 17 billion, 13 billion and 7 billion Riyals Respectively.
He stresses that the participation in the risks offered by Islamic finance linked to credit guarantees is important and appropriate to finance infrastructure projects, which supports economic growth in the short and medium terms. Islamic finance and its structural features and mechanisms are suitable for financing the small and medium enterprises, which are an important source of economic growth of the financial sector in the world, indicating that the percentage of financing obtained from the banking sector does not exceed 2% of the total loans, while it is exceeding 33% as average in some developed countries, considering it as an opportunity to cover the Islamic Finance, this important category, which provide many opportunities.
Al-Jadaan also discussed the challenges and obstacles facing Shariah-compliant services on the worldwide, pointing out to the most important challenges, such as the small size of Islamic Financial Institutions, the lack of sufficient tools to manage short-term liquidity in Islamic Financial Institutions, the shortage or scarcity of qualified professionals for Islamic Financial Institutions, and the shortages of the high-quality practical Islamic research.
It is worth mentioning that this conference aims to raise the level of research, theoretical and applied studies on the economics of Islamic Finance, highlighting the impact of Islamic Finance Economics and its effectiveness in the fields of the assets of financial sciences and the applied aspects of the financial industry. The conference includes 14 scientific papers, that were from 145 scientific papers, presented to the conference by international universities. Of these, 40 were prepared by students from universities around the world such as Oxford University in Britain, Bonn University in Germany, Georgia University of America, Monash University in Australia, The International Center for Islamic Finance in Malaysia, and other universities and academic institutions.