Kazakhstan and Malaysia signed a memorandum of understanding in the field of Islamic finance

On October 30, an official meeting of the Kazakh-Malaysian Business Council was held in Almaty. During the meeting, there was held business forum with the participation of more than 150 representatives of Kazakhstan and Malaysian business and officials.

            The forum was attended by more than forty companies from Malaysia, employed and in demand in various sectors of the economy (oil and gas, construction, medical, metal, light industry, and many others), as well as more than 60 companies from Kazakhstan, representing various sectors of the economy, both public and commercial.

               The forum discussed opportunities for expanding bilateral trade, economic and investment cooperation, creating a platform for discussing potential joint projects and enhancing business contacts between Kazakhstan and Malaysia, reports Bernama. However, the key issue of the business forum was Islamic finance.

               The provider of development of Islamic finance in Kazakhstan is the AstanaInternational Financial Centre, which is developing this area at the institutional and conceptual levels.

                Today, in the framework of the Forum, the AIFC signed a memorandum of understanding with a consortium of two Malaysian companies: consulting company Amanie Advisors and law firm The Chambersof Shamsul Qamar. The memorandum aims to develop cooperation in the field of Islamic banking and finance.

               Cooperation in the framework of the memorandum provides the provision of comprehensive information on the development of the Islamic financial industry in Kazakhstan and  within AIFC to representatives of the Malaysian business, the promotion of the AIFC as a market for Islamic finance at the regional and global levels, and the involvement of representatives of the Islamic finance ecosystem in AIFC.

               Today, 76 companies are registered with the AIFC, 4 of which are Islamic financial institutions. The presence of financial institutions can play a positive role in attracting investment: Kazakhstan ranked 5th in terms of attractiveness for Islamic investment among 57 OIC member countries (Thomson Reuters Islamic Growth report 2015).

               The AIFC has established a legal framework for Islamic finance and work to adopt an appropriate legislative framework for Islamic insurance and reinsurance (Takaful and re-Takaful) is underway. In accordance with the Concept of development of the financial sector 2030, it is expected that the volume of Islamic banking assets in Kazakhstan by 2025 will reach 3-5% of the total banking assets and the AIFC will play a significant role in achieving this goal.

               Everyone also knows that today Malaysia is an international center of Islamic finance. Currently, there are 16 local and foreign Islamic banks operating in the country; Islamic finance accounts for about 25% of the entire banking industry in Malaysia. It was in Malaysia that Islamic financial instruments were first used.

               Given the rich experience of the country, it can be said that cooperation with Malaysia will open up new opportunities for Kazakhstan in this direction.

“The forum is an excellent platform for the development of mutually beneficial cooperation and partnership between representatives of the business communities of both countries, and the Kazakhstan-Malaysian Business Council is an organization that provides all the necessary tools for further and full-fledged business development for companies in Kazakhstan and Malaysia,” said Dato Berikkazy Seksenbayev at the opening events co-chairman of the Malaysian-Kazakhstan Business Council.

It is worth noting that Malaysian companies and investors in Kazakhstan are jointly implementing projects in the field of oil and gas, agriculture, engineering and construction totaling $ 1 billion.

             Also, other promising areas of enhanced cooperation can be seen in the field of Islamic finance, halal industry, renewable energy, tourism and many others.

            Today, Malaysia is among the leading trade partners of Kazakhstan in the South-East Asia region. By the end of 2017, mutual trade increased by 49 percent and amounted to $ 123.4 million.

            Positive dynamics were observed in the current year. In the first eight months of 2018, mutual trade increased by 72 percent and amounted to $ 112.6 million.

           Photo: Pressclub.kz