MinDA eyes Is­lamic in­sti­tu­tions as good fund­ing source

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DAVAO CITY -- The Min­danao Devel­op­ment Au­thor­ity (MinDA) is eye­ing Is­lamic fi­nan­cial in­sti­tu­tions as a good source of funds to de­velop agri­cul­tural in­dus­tries in Min­danao.

Adrian Ta­mayo, MinDA’s Pub­lic Af­fairs Di­vi­sion chief, said Is­lamic fi­nanc­ing has never been given due at­ten­tion in the coun­try and still needs a reg­u­lar frame­work for it to be fully uti­lized.

“There is an ex­pres­sion of in­ter­est from Is­lamic fi­nan­cial in­sti­tu­tions to help par­tic­u­larly the agri­cul­ture sec­tor and the ha­lal in­dus­try which is a grow­ing sec­tor in Min­danao,” Ta­mayo told re­porters dur­ing Wednesday’s Armed Forces of the Philippines-Philip­pine Na­tional Po­lice press corps brief­ing at the Royal Man­daya Ho­tel.

He said Is­lamic in­sti­tu­tions have seen the big po­ten­tial of Min­danao’s agri­cul­ture and ha­lal sec­tors.

The ha­lal in­dus­try alone, Ta­mayo said, is a grow­ing mar­ket in the world with a value of around USD3 tril­lion, which Min­danao would

like to have a share of. Other po­ten­tial ar­eas that can be funded by Is­lamic in­sti­tu­tions are lo­gis­tics and con­nec­tiv­ity.

Ta­mayo said there are al­ready moves to make Is­lamic in­sti­tu­tions as one mode of fi­nanc­ing through Sukuk, an Is­lamic fi­nan­cial cer­tifi­cate that pro­vides in­vestors with un­der­ly­ing as­set. It is re­ferred to as bonds which are com­pli­ant with Sharia (Is­lamic law).

Ta­mayo said presently only the Amanah Is­lamic Bank is the only in­sti­tu­tion al­lowed to do Is­lamic bank­ing in the coun­try.

Amanah Bank is a whol­ly­owned sub­sidiary of the Devel­op­ment Bank of the Philippines (DBP), which ac­quired 99.9 per­cent own­er­ship of the bank in 2008.

Ta­mayo said there are other Is­lamic in­sti­tu­tions from the Mid­dle East and In­done­sia that wanted to see peace in Min­danao af­ter the pas­sage of the Bangsamoro Or­ganic Law (BOL).

Cur­rently, the bill which seeks to or­ga­nize and reg­u­late Is­lamic banks in the coun­try passed the com­mit­tee level at the House of Rep­re­sen­ta­tives in Au­gust last year.

If ap­proved by Con­gress, this will com­ple­ment the BOL. Un­der the bill, the Bangko Sen­tral ng Pilip­inas’ (BSP) Mon­e­tary Board may au­tho­rize the es­tab­lish­ment of Is­lamic banks.

It may also au­tho­rize con­ven­tional banks to en­gage in Is­lamic bank­ing ar­range­ments, in­clud­ing struc­tures and trans­ac­tions, through a des­ig­nated Is­lamic bank­ing unit within the bank.

For­eign Is­lamic banks may also be au­tho­rized to es­tab­lish bank­ing op­er­a­tions in the Philippines un­der any of the modes of en­try pro­vided un­der Repub­lic Act 7721 or “An Act Lib­er­al­iz­ing the En­try and Scope of Op­er­a­tions of For­eign Banks in the Philippines and for Other Pur­poses”. (PNA)

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