Islamic banking hits a crucial threshold

IN THE MARKETS: “Islamic Banking Moves Into Singapore: City-State Stakes Claim in Growing Sector; DBS, Mideast Investors Capitalize New Firm,” by Patricia Kowsmann and Karen Lane, Wall Street Journal, 8 May 2007, p. C7.

When big international banks start moving assets into micro-lending, then it becomes interesting. Give the Nobel to Grameen, but give the momentum to a Citibank, because then the niche becomes the mainstream.

Singapore becoming a nascent hub for Islamic banking is a big deal. Singapore is the natural flow-through point for all foreign direct investment, so its only natural it will become the big flow-through for Islamic banking that links the Mideast’s oil surplus to Asia’s infrastructure boom, while simultaneously linking Asian finance to the GCC’s internal investment boom.

In short, the East-East ties are growing, and Islam--to the surprise only of the economic know-nothings--is proving to be an answer, not solely the problem.

Soon enough, Islamic “values” will prove no more difficult for capitalism to mold in its image than Asian “values” were.

Inconceivable until time makes it inevitable. Marx was right about capitalism. In the end, every wall falls to this tidal wave we now call globalization.

Comments

[dave]

you can get free access to those WSJ.com articles and other subscription content with a free netpass from http://www.congoo.com

That is on the cover of PC world Magazine

[Hazel]

I thought HSBC was the first to start Islamic Banking? Don't they already have a hub in Malaysia? Or have I got it wrong? Here's where I got my info: http://www.hsbcamanah.com/hsbc/amanah

[Tom Barnett]

This Singapore bank doesn't start it. I didn't say that. It's been around in Malaysia since origins in 2001.

The importance here is that it's now established enough for heavyweight Singapore to pursue.

[Mark in Texas]

It is interesting that Non-Islamic Singapore becomes a center for Islamic banking like Miami became a center for banking and investment in Latin America. In both cases, the business center is located in a stable place with enforcible contracts, the rule of law and where the electricity and phones work.