As an industry worth around $1.85 trillion (£1.15 trillion) globally, with growth rates of up to 15 per cent each year, many are attracted by the sheer potential of Islamic finance. But in the wake of the financial crisis, many more are drawn by the principles of balance, shared risk, fairness and transparency upon which it is based.
With billions of pounds in reported assets, and with the world’s financial capital, the UK is an increasingly important global player in Islamic finance. Iconic buildings like London’s Shard have been given life with the help of Islamic finance, and our capital is home to a growing number of banks, law firms and other service providers with expertise in the sector. Added to this is Britain’s wider business offer. From our legal system and regulatory framework, to our time-zone and track record of innovation, the UK is rightly seen as a partner of choice.
But we’re not complacent. We are determined to play our part in the development of the Islamic finance market. This is why the Prime Minister announced yesterday that we want to become the first country outside the Islamic world to issue an Islamic bond, a sukuk. Britain is in a global race. With economic power shifting East and South, it is more important than ever to grasp the opportunities emerging in Islamic and ethical finance, responding to the growing demand for a banking system that works for all – and is open to all.
Yesterday’s announcements demonstrate that the UK wants to play an even more prominent role. We have a unique opportunity today, to not only build on our trading relationships with the Muslim world, but crucially in other areas of the UK’s strength, like healthcare, education and smart cities. At WIEF, we have established a dedicated British Business Pavilion to promote the UK to the Islamic world, to highlight areas of British expertise, and to show we are a first class destination for trade and investment.
The Prime Minister’s announcements this week will help to cement Britain’s position as the leading player for Islamic finance, and help to deliver my vision of an Islamic finance market that never sleeps.
Baroness Warsi is senior minister of state in the Foreign and Commonwealth Office.