JEDDAH, 12 April 2008 — A prominent Saudi economist has blamed the current American economic recession partly on Washington’s adventurism in Iraq that has already cost the world’s only superpower more than $1 trillion.
“The US attack on Iraq has not only destroyed a relatively well-developed Muslim country but also harmed the US economy,” said Dr. Umar Chapra, who served for 35 years as a senior economic adviser at the Saudi Arabian Monetary Agency (SAMA).
Speaking to Arab News, Chapra emphasized the need to reintroduce moral values into economics for the welfare of humanity. The absence of moral constraints on economic pursuits would have disastrous consequences.
“The US attack on Iraq, for example, was undertaken to serve the US interest by bringing all the Iraqi oil under its control and later on all the Gulf oil. In the process, the US has killed more than 600,000 Iraqis and 4,000 Americans and wasted more than $1 trillion,” he explained.
Chapra, who has won King Faisal International Prize for his contributions to Islamic economics, said the US could have benefited a lot if it had spent that huge amount for its development and well being of its poor.
The secular overtones of the western enlightenment movement, he said, had deprived conventional economics of the spiritual content as took into account only material factors in the allocation and distribution of resources and ignored other factors, including the moral. “Islamic economics is trying to reintroduce moral values into economics,” he added.
Chapra has been working as a research adviser since 1999 at the Islamic Research and Training Institute of the Islamic Development Bank (IDB) and has authored several books on Islamic economics and finance.
He expected Islamic economics would receive wider acceptance across the world as a result of the recurring international financial problems, especially the recent subprime mortgage crisis in the United States.
He refuted suggestions that Islamic economy was a nascent one. “Although it had developed to a great extent in the early centuries of Islam, it became almost dormant during the long period of Muslim decline. This is but natural. Ibn Khaldun has rightly observed that sciences do not develop when a civilization is in the process of decline.”
Islamic economics, Chapra said, aims to achieve the welfare and well being of humanity. “Human well-being cannot be attained by concentrating primarily on the material constituents of well-being. Due attention should be given to the spiritual content of well-being for people to achieve satisfaction,” he added.
Chapra said that belief in God and the accountability before Him in the Hereafter was essential to motivate people to work for the well-being of others. “This gives a long-term perspective to self-interest. We may be able to serve our self-interest in this world by being selfish. We cannot, however, serve it in the Hereafter except by fulfilling all our socio-economic obligations in this world.”
Chapra described Islamic economics as the need of the hour. “It can solve the economic problems of mankind and ensure justice and the well-being of all,” he added. Islam has laid great stress on Zakah and Awqaf (endowments) systems to enable the poor to stand on their own feet and to fulfill the needs of the helpless.
He said a large amount of human and material resources were necessary to promote Islamic economics. “We have to concentrate on the socio-economic problems and show how the combination of the moral with the material can help solve them in a more effective manner. This requires a great deal of theoretical as well as empirical analysis,” he concluded.
