Manila steps up Islamic banking ‘to foster growth’

Filipino Muslims will have access to a wider range of Islamic banking services under a new law signed by President Rodrigo Duterte. (AP)
Updated 31 August 2019

Manila steps up Islamic banking ‘to foster growth’

  • The legislation is expected to pave the way for the entry of foreign Islamic banks into the Philippines

MANILA: Filipino Muslims will have access to a wider range of Islamic banking services under a new law signed by President Rodrigo Duterte.

The expansion of the Islamic banking system in the country will be carried out under the supervision of the Philippines Central Bank and its Monetary Board.

Muslims, including those in the autonomous Bangsamoro region in the southern Philippines, stand to benefit from the move, which central bank Gov. Benjamin Diokno said will “unlock the full potential of Islamic financing in fostering inclusive economic growth.”

Under the new law, conventional banks also will be allowed to engage in Islamic banking arrangements, providing they segregate the transactions from conventional business.

The legislation is also expected to pave the way for the entry of foreign Islamic banks into the Philippines.

However, the Monetary Board will regulate the number of participants in the Islamic banking system, taking into account the requirements of the economy, financial stability and the need for healthy competition.

Currently the Al-Amanah Islamic Investment Bank of the Philippines is the only Islamic lender operating in the country.

Diokno praised the new law, which he said will promote inclusive economic growth.

“With a well-defined regulatory framework now in place, the Bangko Sentral ng Pilipinas (BSP) looks forward to seeing greater participation in Islamic financing by both domestic and foreign banks,” he said.

“This is expected to widen opportunities for Muslim Filipinos, including those from the Bangsamoro region, in accessing banking products and services. This is a great stride in our financial inclusion mandates.”

An interagency working group has been set up to develop a regulatory framework for Islamic banking and finance.

According to the BSP, Islamic banking and finance promote growth by making finance available to groups that avoid using conventional banking facilities due to their faith.

Muslims make up about 10 percent of the population of the Philippines.

Islamic banking and finance can also be attractive to non-Muslims, particularly investors within or outside the Philippines looking for new asset classes, instruments and products to diversify their portfolios.


Kim Jong Un supervises another North Korean military drill

Updated 3 min 52 sec ago

Kim Jong Un supervises another North Korean military drill

  • North Korea has publicized two military drill in three days
  • Kim Jong un has urged combat pilots to prepare against enemies ‘armed to the teeth’ while attending a flight demonstration
SEOUL: North Korean leader Kim Jong Un supervised a parachuting drill of military sharpshooters and vowed to build an “invincible army,” displaying more defiance even as the United States and South Korea called off their own exercises to create space for nuclear diplomacy.
The report Monday by the Korean Central News Agency came hours after President Donald Trump in a tweet urged Kim to “act quickly, get the deal done” while hinting at another summit, writing, “See you soon!”
At an Asian defense ministers’ conference in Bangkok on Sunday, US Defense Secretary Mark Esper said the United States has indefinitely postponed a joint military exercise with South Korea in an “act of goodwill” toward North Korea. Diplomats have been pushing to resume stalled nuclear talks ahead of Kim’s end-of-year deadline for the Trump administration to salvage the diplomacy.
North Korea has publicized two military drill in three days. A report Saturday said Kim urged combat pilots to prepare against enemies “armed to the teeth” while attending a flight demonstration.
KCNA published photos that showed Kim posing with North Korean air force sharpshooters and soldiers who used white parachutes to land on a training field.
Kim while supervising the drill said it’s “necessary to wage a drill without notice under the simulated conditions of real war” for improving his military’s war readiness and build it into an “invincible army,” KNCA said. Kim did not make any specific comment toward Washington or Seoul in the report.
North Korea has been ramping up missile tests and other military demonstrations in recent months in an apparent pressure tactic over the talks.
Negotiations have faltered since a February summit between Kim and Trump in Vietnam, which broke down after the U.S. rejected North Korean demands for broad sanctions relief in exchange for a partial surrender of its nuclear capabilities.
Kim issued an end-of-year deadline for the Trump administration to offer mutually acceptable terms for a deal while saying that the North would seek a “new path” if the United States persists with sanctions and pressure.
Working-level talks last month in Sweden broke down over what the North Koreans described as the Americans’ “old stance and attitude.”
North Korea last week said the United States has proposed a resumption of stalled nuclear negotiations in December. But North Korean negotiator Kim Myong Gil didn’t clearly say whether the North would accept the supposed U.S. offer and said the country has no interest in talks if they are aimed at buying time without discussing solutions.
He said the North isn’t willing to make a deal over “matters of secondary importance,” such as possible US offers to formally declare an end to the 1950-53 Korean War, which was halted by a cease-fire, not a peace treaty, or establish a liaison office between the countries.