Financial Outlook of the OIC Member Countries 2016
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Challenges and Problems:
The participants, in line with the discussion took place during the 6th Meeting of the COMCEC Financial Cooperation
Working Group, highlighted the following possible challenges and problems:
 Weak regulatory systems
 Lack of Shariah governance infrastructure
 Lack of necessary institutional infrastructure
 Lack of Islamic financial instruments and services
 Lack of specialized Islamic finance academic and training programs
 Lack of initiatives, i.e. campaigns on increasing public awareness, to promote Islamic finance
 Lack of diversified Islamic Finance Strategies/Policies targeting the various needs of investors
 Lack of SMEs access to finance
 Low level of integration of Islamic Finance to the global financial system
 Lack of liquidity framework for Islamic Banks
 Lack of high quality research and intellectual discussions
Policy Recommendations:
Considering the above-mentioned challenges and problems, the policy recommendations highlighted during the Meeting
are as follows:
1. Legal, Regulatory, Accounting and Taxation Frameworks
 Reviewing existing Islamic financial regulations and guidelines to ensure compatibility with Shariah guidelines
 Developing an independent agency to monitor the products in secondary markets and exchanges
 Developing a legal infrastructure to foster growth of the Islamic financial system
 Developing a specific disclosure guidelines for Islamic Financial Institutions(IFIs) that increases transparency
 Ensuring tax-neutrality for Islamic financial transactions in order to provide them a level playing field
2. Shariah Governance and Supervision:
 Establishing a National Shariah Board/necessary institutional set up to provide oversight and governance to
internal and independent Shariah boards of financial institutions
 Developing seminars and training programs for Shariah scholars about Islamic financial operations and
product development
 Increasing collaboration between Shariah scholars and Islamic finance management
3. Infrastructure:
 Developing secondary markets for Islamic financial products
 Developing exchanges for Islamic financial products
 Adoption/adaptation of international standards issued by IFIs (i.e. IFSB, IIFM, AAOIFI, etc.)
 Developing liquidity management frameworks for IFIs
 Improving the IT capacity of Islamic financial institutions