The speed at which events have taken place in Libya over the past month has taken the world by surprise: not least the country’s interim government. But as the National Transitional Council begin to set in motion their plan for reconstruction, it’s clear Islamic finance has the opportunity to play an important role.
A few Islamic products are already offered by the country’s Wadha bank, despite a skeptical Gaddafi regime which never implemented legal or regulatory frameworks to develop the industry. Now, it’s hoped the NTC will work with partners – for example, in Turkey – to develop this further.
It’s likely too that the volatile situation across the wider middle east region will offer potential for the growth of Islamic investment insurance, Takaful, and export credit. Islamic structured trade finance could also play an important role in the market as Libya rebuilds and develops. While the conflict is far from over, Islamic finance will undoubtedly be part of the country’s future.
