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London:
The British government launched a campaign to promote London as a
centre for Islamic finance, seeking to counter growing competition
in that industry from rising centers such as Dubai and Kuala
Lumpur.
A task force including Britain's Financial Secretary to the
Treasury Greg Clark, ministers of state and private sector
executives will advertise London around the world, the British
Foreign Office said.
The group will try to attract foreign
investment to Britain by facilitating Islamic financial business,
including investment in British infrastructure by Islamic
sovereign wealth funds, the Foreign Office said in a statement.
Because of its status as a top global financial centre, London has
attracted a large amount of Islamic business; more than $34
billion (22.8 billion pounds) worth of sukuk, Islamic bonds which
are structured under religious principles such as a ban on
interest payments, have been issued through the London Stock
Exchange.
But competition from cities where Islamic funds originate is
increasing. Kuala Lumpur is building its credentials as a centre
for foreign companies to issue sukuk outside their domestic
markets, while Dubai announced in January that it would revise
regulations to attract sukuk issuance and trading.
Britain has
introduced legislation facilitating Islamic finance, and in 2009
it came close to issuing Europe's first sovereign sukuk.
he issue
was ultimately postponed indefinitely because the government felt
it would not provide value for money, Farmida Bi, European head of
Islamic finance at law firm Norton Rose in London, told Reuters.
The World Islamic Economic Forum, a conference of Islamic
financiers to take place in London this October, will be an early
opportunity for the new British task force. It will be the first
time the forum is held outside of an Islamic city or Asia.
Some other parts of Europe are also showing increased interest in
Islamic finance as much of the conventional financial industry
struggles.
The European Central Bank and the
Malaysia-based Islamic Financial Services Board, a global
standard-setting body, are conducting a joint study on policies
affecting Islamic finance in Europe.
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