ID Series 3: The Islamic Macroeconomic Model: Moving Towards Riba-free Economy
Kuala Lumpur, 16 March 2023 – How we can vacate the interest rate economy “which in reality is only an administered price with no connection to economic fundamentals. As a result, using the interest rate as a benchmark and/or a monetary policy tool will produce unpredictable results. “
This was the question posed by Dr Mabid Ali Al-Jarhi, Professor of Economics and Finance at the Social Sciences University of Ankara at INCEIF Discourse Series 3 held on campus today. With the topic `The Islamic Macroeconomic Model: Moving Towards Riba-free Economy’, Dr Mabid was joined by commentator Prof Dr Turalay Kenc, INCEIF Faculty Member who was the former Deputy Governor of Central Bank of the Republic of Türkiye.
Dr Mabid is a founding member of the International Association for Islamic Economics, and a Member of the Shariah Board of the Dubai Financial Market.
In his presentation, Dr Mabid suggested that a number of effective development policies be carried out, including streamlining the education system to provide the skills necessary for economy-wide expansion, and to subsidise off- and on-the-job training for the same purpose.
“This would be a result of the heavy involvement of Awqaf in providing education services. Awqaf is expected to be more sensitive to private sector requirements than the government.”
Dr Mabid also suggested tuning the political process to the economic process to marshal support for the development plan, and to mobilise enough resources, while keeping best practices of governance and transparency.
“It must be finally stressed that development policies have a long-run horizon. It is not something that is to be attuned to yearly changes in economic activities. Therefore, it should not suffer or take a back seat for cyclical or seasonal justifications,” he added.
For reference to Dr Mabid’s papers on the above topics, click: