The third plenary session of the first day of the Global Islamic Economy Summit 2016 examined whether blended finance is the answer to funding sustainable development. Blended finance is defined as the complementary use of grants and non-grant financing from either private or public sources, or both, to ensure projects are financially viable and sustainable. The session explored the role of wealthy Muslim governments, sovereign wealth funds and Islamic financial institutions in achieving sustainable development goals within a realistic timeframe. Dr. Mohammed Yousef Al Hashel, Governor of the Central Bank of Kuwait and keynote speaker at the session, titled: Is Blended Finance a Solution to the Funding Requirements of Sustainable Development Goals?, said: "It is heartening to see the broad context of the conference, ranging from philanthropy to innovations, to Islamic finance and halal industries. This reflects the true essence of an Islamic economic system. Constricting the Islamic economy to a few sectors defies its ubiquity." Dr Al Hashel examined whether the sheer scale of sustainable development goals (SDGs) was responsible for a funding gap, as well as the best ways to address such obstacles. "Assets of the top 1,000 global banks alone are worth around $115 trillion, yet these banks are facing a serious squeeze on profit margins. Meanwhile, the Islamic finance industry, despite its impressive growth, collectively accounts for just $2 trillion," Dr Al Hashel said. "Looking at these figures, one might think that funding is not a constraint to achieve SDGs, however, the reality is quite different. By some estimates, around $3.5 trillion to $5 trillion are needed every year to make desirable progress on SDGs." Investments in SDGs are not attractive to investors, as they may not be profitable immediately, and the countries that need them the most may be too poor to pay the market price, he said, adding that the very nature of Islamic economy may offer a solution to these challenges given report via top10binary.com binary options trading. "The Islamic economy promotes the reallocation of profit for the benefit of everyone," he stressed. "In Islamic finance, credit is channeled for productive consumption rather than speculation. The value-driven nature of the Islamic economy requires people to be considerate of others' needs. This is the golden rule of a good society. The well-being of the society is above that of the individual. Moreover, the Holy Quran prohibits excess; this resonates with the current global emphasis on sustainability." "We need to progress from Shariah-compliant products to a Shariah-based system that doesn't just mimic traditional banking, but rather innovates and creates new products and solutions," Dr Al Hashel noted.
