News From : DagangHalal.com (17 Oct 2011)
By Samantha Tan Chiew Ting
KUALA LUMPUR – Malaysia can emerge as a centre of excellence for Islamic venture capital, says Islamic economist, Prof Humayon Dar.
Humayon said the country has the chance of receiving risk capital from other parts of the Muslim world, especially the Gulf Cooperation Council (GCC) members.
“Given the government’s commitment and dedication, I believe in three to five years, Malaysia will emerge as a centre of excellence for Islamic venture capital.
“If the government is looking into developing Islamic venture capital, I believe it is going to attract lots of interest from GCC, especially Saudi Arabia, United Arab Emirates and Qatar,” he told Bernama in an interview here today.
He said during the financial crisis, Malaysia has emerged as the only global centre of excellence in Islamic finance.
Humayon said Islamic venture capital in Malaysia was still in initial stage despite lots of time, efforts and money put in by the government to develop the industry.
“Nevertheless, the government has shown its seriousness and it is clear that it is committed to promote Islamic venture capital in the country,” he said.
He said the challenges faced by the government now was that the country needed a comprehensive framework and infrastructure for Islamic venture capital development.
Meanwhile, Rushdi Siddiqui, Global Head of Islamic Finance, Thomson Reuters, said Malaysia could make a similar commitment to Islamic finance and halal industry for the venture capital.
He said Malaysia was one of the few countries within the Organisation of the Islamic Conference (OIC) that has made a commitment and it basically walked the talk.
Rushdi said Malaysia has spent resources in bringing venture capital experts to the Kuala Lumpur International Venture Capital Symposium 2011.
However, the key issue now was to follow through with execution, he said.
“If the commitment towards Islamic finance and halal is there and if venture capital can have the same type of commitment, I think Malaysia is going towards a knowledge-based economy,” he said.
Rushdi said Malaysia has more economic sector build-up than other Muslim countries, adding, the country was at the beginning stage of developing the healthcare and technology sector.
“So if the commitment to those sectors is there, then it is a commitment to venture capital also,” he said.
Rushdi said to address the criticism of the present Islamic investing business model, exporting capital and importing returns, Islamic venture capital needed to be linked with public and private partnership to establish a framework for a knowledge-based OIC economy.
“For example, in Malaysia, we have the Bio-technology Park in Iskandar Malaysia and Senai Hi-Tech Park in Johor, and they are work-in-progress and may eventually become case studies for other Muslim countries,” he said.
Rushdi said Malaysia could also look at the success story of the Malaysian diaspora like the Chinese and Indian, where they became financial rock stars in China and India.
He said Malayia needed financial rock stars and these diaspora who became the angel investors (an affluent individual who provides capital for a business start-up) to start the network as they have the credibility and cash.