Islamic economy system

1. Nur Suhaili Ramli,
University Of York, UK

2.  Islam is totally accepting business
 The Prophet urged (peace and blessings be upon him) urged, “Be
involved in business as nine out of ten sources of income lie in
business” (Ihya)
 Its role is defined in the Holy Koran and the Hadiths “ … whoever
returns to [dealing in interest or usury] - those are the companions
of the Fire; they will abide eternally therein…” (Al-Baqarah 2:275)
 This shows that it is contrast to communism/socialism which is
strongly anti-capitalist.

3. In Islam the behaviour in business is set with conditions which it must
not:
 Be greedy
 Seek monopoly or manipulate the market
 Exploit the poor
 Trade in forbidden goods and services such as :
 Alcohol / drugs / tobacco
 Pornography / gambling
 Deal in pork products
 Engage in ‘usury’ riba

4.  Central to Islam is Tawhid
 Tawhid is the Islamic way of life , the fundamental of all Islamic
civilization, which is process, means and end together.
 Tawhid is both the essence of the individual and the society he or she
lives in.
 Tawhid is acceptance of one creator and His divine guidance of
humanity.
 Tawhid implies both the mission and morality of humankind on both
social and spiritual contexts.

5.  Fall under two categories – fard’ain, and fard kifayah
 Fard’ain means that an individual’s obligation to perform his or her
religious studies.
 Fard kifayah means that an obligation for man to serve the entire
community through services to each other, necessary for the
community to live safely and comfortably.
 The obligation to improve the Muslim Ummah falls under Fard
Kifayah, where undertaking business is the principal method of
improving the economy and community.

6.  Entrepreneurship in Islam – social justice derived through productive
work, where equal opportunities exists for all, and everybody can
utilize their abilities to work and gain just reward for their efforts.
 Most countries adopted concepts of ‘Islamic socialism’ where
references to Islam teachings and shariah were only cursory or
cosmetic.
 There are fifteen general principles of Islamic economy

8.  Islam provides a supportive value system where a person should
seek to achieve economically as well as spiritually
 People are expected to earn their own living, if possible.
 The pursuit of wealth is legitimate, however moderation in
lifestyle is espoused
 Prices should be just, based upon competitive markets.

9.  The inequality of income should not be allowed to become too wide,
therefore the state should intervene to ensure that equality is
maintained
 The needy are protected by society through Zakat
 Land and capital are productive factors, only when combined with
labour. Therefore income should not just be derived from ownership.
 Finance, leases, loans, etc. should be based on the sharing of risk as a
basic principle of justice and equity

10.  Islamic values from upon wasted resources, human skills and idleness.
 Human are God’s custodians and only possess resources temporarily.
So, they must ensure these resources are passed onto the next
generation intact, consequently Muslims have a duty to protect the
environment.
 Private ownership is paramount within the economy, where the state
should only interfere under exceptional circumstances.

11.  Monetary policy should only be utilized to stabilized prices.
 Fiscal policy should only be used to preserve an equilibrium between
tax revenue and public expenditure.
 The state’s role is solely to provide sufficient infrastructure for society
to operate fairly and equitably.
 Antisocial practices that damage society are forbidden where monopoly
and hoarding and other market distortion are not permitted.

12.  Islamic economics provides a way of creating equity within a
community
 Entrepreneurship is the preferred method of agency within an Islamic
economy, where high levels of interdependency through clusters based
on community are advocated.
 Developing entrepreneurship based upon Tawhid principles is
empowering to the Ummah and a way to integrate with the world
without the need to compromise religious beliefs and values
 The Al-Qur’an is not just a book of divinity, it is a practical book of
empowerment, largely ignored for its potential in this regard

13.  Retrieved reading from: http://www.eurasiareview.com/17052013-
entrepreneurship-as-a-means-to-create-islamic-economy-analysis/
 Al-Quran