Philosophy of Islamic Economics - 28 Apr 2010

"O ye who believe! Shall I show you a commerce (bargain) that will save you from a painful doom? You should believe in Allah and His messenger, and should strive for the cause of Allah with your wealth and your lives. That is better for you, if you did but know. He will forgive you your sins and bring you into Gardens underneath which rivers flow, and pleasant dwellings in Gardens of Eden. That is the Supreme Triumph." [Surah as-Saff: 10-12]

The class started with the brief definition of Islam as ad-Deen, with "Deen" coming from the root word "Daana" which means indebtedness, subhan Allah. Befitting as Sheikh Abdul Halim covered Muamalat (Law of Transaction and Trade), Investment and the Muslim as the Economic agent.

There was a comparison between free traders (regard 'voluntariness' as the chief component of justice) vs. fair traders (regard the expression of human dignity as the chief component of justice). If we take the angle of social justice, the latter wins (as it is closer to Muamalat!) - fair traders think that opening free trade even further would entrench trends of rich nations becoming richer and poor nations becoming poorer and that global prosperity cannot forget to include the immediate needs of those in the least well off group.

Then Sheikh covered the 5 basic principles of Investment - invest in a company that is halal (permissible), no guarantee of profits based on capital, no element of Gharar (uncertainty), no elements of Riba' and there should be mutual consent between the involved parties. In my humble opinion, it is a challenge to comply to all 5 principles of investment especially since earning a passive income (wealth accumulation) is not permissible vs. wealth creation per se.

What was important was the principles Muslim Economic agent have to adhere to and this can be summed up by Surah at-Tawbah: 59 and 111:

"(How much more seemly) had they been content with that which Allah and His messenger had given them and had said: Allah sufficeth us. Allah will give us of His bounty, and (also) His messenger. Unto Allah we are suppliants."

"Lo! Allah hath bought from the believers their lives and their wealth because the Garden will be theirs: they shall fight in the way of Allah and shall slay and be slain. It is a promise which is binding on Him in the Torah and the Gospel and the Qur'an. Who fulfilleth His covenant better than Allah? Rejoice then in your bargain that you have made, for that is the supreme triumph."

Afternote: A note to me - Put your life in Allah's hands and ikhtiyar towards attaining His barakah, truly that is sufficient for you :)