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Islamic finance seen as driver for FDI inflow to Philippines, say govt officials

Peter Alagos

Saturday، 01 August 2020 07:36 PM

The Philippines is looking at Islamic finance as a platform to attract and encourage partners in the Middle East, such as Qatar, to expand their footprint in the Southeast Asian nation, particularly in the field of Islamic banking, according to government officials during a recently-held webinar.

The virtual conference, organised by the Philippine Economic Zone Authority (Peza), in co-operation with the Banko Central ng Pilipinas (BSP), tackled the theme ‘Islamic Finance as a Vehicle to Economic Recovery’, and highlighted discussions on foreign investment opportunities in the Philippines via Islamic finance.

This is the third in a series of ‘Business Continuity Forums’ held by Peza, in collaboration with the Institute for Autonomy and Governance (IAG), and in co-operation with Peza’s Investment Promotions Partners in the Middle East.

Peza director general Charito B Plaza underscored the importance of Republic Act (RA) 11439 or ‘An Act Providing for the Regulation and Organisation of Islamic Banks’ signed by President Rodrigo R Duterte on August 22, 2019, which will maximise the full potential of Islamic financing in promoting inclusive economic growth.

Plaza emphasised that the Philippines, being a multi-cultural and democratic country, “strongly cares for the inclusion of our Muslim brothers and sisters” in the large Islamic financial framework in the global market.

“Islamic banking will surely help Peza achieve its vision in promoting economic growth in the countryside,” Plaza pointed out.

Plaza’s remarks during the webinar reiterated the statements delivered by Abdulgani M Macatoman, the undersecretary of the Department of Trade and Industry (DTI) Trade Promotions Group (TPG), who was in Qatar earlier this year during the Doha leg of the DTI’s ‘Outbound Business Matching Mission (OBMM) to GCC 2020’.

Macatoman stressed that the Philippines is keen to partner with Qatar in the development of its Islamic banking system, and that the Southeast Asian country could benefit from Qatar’s expertise in Islamic banking and Shariah-compliant policies.

Lawyer Arifa A Ala, managing director at the BSP, highlighted that RA 11439 was created as an expanded Islamic banking system that involves tax neutrality, stronger risk management, ethical financial stability, further establishment of Islamic banks, and other Islamic financial activities, as well as the imposition of principle-based rules and standards, in addition to strict Shariah law compliance.

“Philippine Islamic banking is an alternative product/service available in the market and is not exclusive to Muslims. As such, foreign Islamic banks and investors, especially from the Middle East, are welcome to expand their operations in the Philippines. Meanwhile, local commercial banks may also open an Islamic bank and/or Islamic banking units/windows,” Ala stressed.

Peza also recently launched an online job expo titled ‘Development Outreach for Labour, Livelihood, and Advancement of Resources’ (Dollar), which offered 69,081 jobs and online skills training for displaced Overseas Filipino Workers (OFWS) and unemployed Filipinos. The jobs are available at www.workbank.com/dc/peza-online-job-fair.

The programme was held with the support of the Philippines’ Department of Trade and Industry (DTI), Department of Labour and Employment (Dole), and the Office of Senator Bong Go.

DTI secretary Ramon Lopez said Peza’s online job fair and skills training are very much aligned with DTI initiatives and other agencies to aid repatriated OFWs and locally-unemployed Filipinos.

Dole secretary Silvestre Bello III said, “The role of service providers and investment promoters of our economic zones cannot be over-emphasised…the active engagement of these key pillars is the fuel to rev up our workforce.”


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