Baku: The link between Islamic finance and the halal economy should be strengthened, stated Nazeem Noordali, Chief Operating Officer of the International Islamic Trade Finance Corporation (ITFC), at the 'Strategic Leadership Dialogue on Ethical Halal Business Models and Risk-Resilient Financing' session. This event was part of the Islamic Development Bank (IsDB) Group Annual Meetings in Baku, reported APA.
According to Azeri-Press news agency, Noordali highlighted the growing significance of the halal economy, which is now valued at approximately $2.35 trillion. He also noted that the assets within the Islamic finance sector range between $5.5 trillion and $6 trillion, with expectations of further growth in the upcoming years. However, he pointed out a significant mismatch between Islamic finance and the real economy, indicating that the synergy between the strength of Islamic finance and the needs of the halal economy is not being realized as expected.
Noordali emphasized that businesses in sectors such as halal food, pharmaceuticals, and tourism are not receiving adequate financing. He urged the member states of the Organisation of Islamic Cooperation (OIC) to play a more proactive role in the development of the halal economy by expanding access to finance for small and medium-sized enterprises (SMEs). He asserted that SMEs require not only financing but also capacity building and institutional support to leverage opportunities in the global halal market.
He further identified the lack of financing as a primary obstacle to the halal economy's growth. Citing estimates from the Asian Development Bank, Noordali mentioned that the trade finance gap exceeds $2.5 trillion, indicating a substantial amount of unrealized economic potential. He called for enhanced cooperation among governments, financial institutions, and the business sector to develop innovative financing solutions, especially for small businesses facing challenges related to collateral, access to finance, and governance.
Nazeem Noordali concluded by stressing the importance of building a bridge between Islamic finance and the halal economy, asserting that strengthening this link would contribute to business growth and the sustainable development of the global halal economy.