Islamic tools offer solution to economic woes: Turkish President

ISTANBUL: Turkish President Recep Tayyip Erdogan has said that the Islamic economy offers a solution to the economic woes currently faced by the world.

The statement came during a speech he delivered via video link at the 12th International Conference on Islamic Economics and Finance.

The Turkish president pointed to “over-financing’’ as the cause of a bloated economic model. “The current economic model acts only over concern about unearned income, without consideration for social and human costs, which can be remedied by Islamic tools,” he said.

Referring to Islamic bonds, he said, “To finance long-term large infrastructure investments, the use of products such as Sukuk should be expanded.”

He further said, “We are aiming to turn our Istanbul, located at the juncture of continents and cultures, into an Islamic finance and economy centre.”

Erdoğan said the distribution of income and wealth was gradually deteriorating all over the world while the gap between the countries had widened. “Every crisis that started in the financial sector quickly spreads to the real sector and creates an army of the newly unemployed,” he added.

Commenting on the effects of the coronavirus pandemic on global economies, the Turkish President said that Turkey was among the countries least affected by the fallout from the outbreak.

He said, “During this period we saw that prosperous countries experienced difficulty in even supplying masks and minimal health services to their citizens,’’ adding, “In addition to meeting the needs of our people, we supplied health aid to 125 countries in the world.’’

Earlier this year, credit rating agency Moody’s announced that Turkey’s Islamic banking assets are set to double within a decade, as government initiatives drive growth in the sector.