Rahma Suci Sentia
A
major economics events in US has slowed the economic growth down in 2008,
its when American banks declared bankruptcy, Lehman Brother and the largest insurance
company AIG collapsed, then almost 3
millions American lost their home due to lack of ability to pay instalmets and
finally resulted ‘domino effect’, namely
global crisis. From islamic finance perpective, it is the result of combination
riba/interest and gambling which if both of these come together, its a sign of
doom and destruction. Both western and eastern economist also have deeply understood that
interest, uncertainty, speculation, and
gambling systems have made
instability of economic system for periods, but they are still confused
‘how financial system could run without
those’.
In
recent years, certain countries have adopted
a policy of allowing islamic finance to
run financial activities were
previously liberalized and socialized run. However, many people are concerned
about how islamic finance subtance would be capable once the huge and super finance capitalism gave up to tackle the crisis. There are
several foundations which make islamic
finance become capable with this.
One
of the major foundations of islamic finance is to prohibit riba /usury/interest
creating money from money which is very
common and mayor key in reaching profit in capitalist or socialist system and
to encourage profit sharing. The purpose is how the risk-profit sharing would
be more conductive to the promotion of entrepreneurship and equity. If they
made it against this foundations, it could leads poorer people
to the over-exploitation of their resource. The advantage of this foundation
would be a strong motivations for poorer
to advance their standar of living and to encourage the brotherhood and
cooperation spirit among richer and lower income people in business
relationship.
Beside islamic finance have to not be running
riba/interest system, it must be free
from gharar or uncertainty which is any uncertainty transcations regarding the
existence or the description of objects becauses of the lack of information.
Insurance and financial derivaties are example that have developed as a result
of uncertainty. If people found uncertainty practices resulting from a
transaction, they could refuse to continue the economics transaction. The
advantage of these policy that it would protect against unexpected losses and
the possible disagrement regarding qualities or incompleteness of information.
Another
foundations of islamic finance is the
prohibition of maysir or gambling
transaction which refers to the easy
acquisition of wealth by chance, whether or not it deprives the other’s right. However,
such a proposal might be highly unpopular with some people because major of
world-wide cash flow had been created from this.
To
summarize, the problem of economic
crisis is not easy to resolve. It is my view that by appling the subtance of
islamic finance foundations prohibiting riba,
gharar, and maysir in all of
financial activities , financial
activities could be productively run and the economic equity and stability would be reached. Islamic financial
institution in several countries, like Saudi Arabia, UAE, Malaysia, Indonesia,
even UK have shown their success in practicing those foundations. However, islamic finance still need to
participate actively and should get a chance to participate in solving global
problem to demonstrate its capability to take long term solution. (Sentia)
