TIEF – Turin Islamic Economic Forum
The Turin Islamic Economic Forum is a project shared by the City of Torino, the Chamber of Commerce of Torino, the University of Torino and ASSAIF– Associazione per lo Sviluppo di Strumenti Alternativi e di Innovazione Finanziaria – to promote effective initiatives on Islamic Finance for social inclusion and economic development of the territory.
It’s a unique event hosted by a local government that offers local stakeholders the chance to meet international leading players in the fields of Islamic finance and economy.
An event to share ideas, learn from outstanding international best practices and examine new trends in Islamic Finance focusing on the use of Islamic finance to trigger processes of social inclusion and to foster economic development and internationalisation.
The Turin Islamic Economic Forum (TIEF) is a project shared by the City of Torino, the Chamber of Commerce of Torino, the University of Torino and ASSAIF– Associazione per lo Sviluppo di Strumenti Alternativi e di Innovazione Finanziaria – to promote effective initiatives on Islamic Finance for social inclusion and economic development of the territory.
The Turin Islamic Economic Forum (TIEF) is a strategic event for the consolidation of the international role of Torino; it aims to make Torino an Islamic economic hub in Italy and Europe by creating knowledge and awareness on Islamic economics, fostering social inclusion and investments attractiveness.
Torino is working on the creation of a favourable environment for investments and also to make Torino a better place to live.
Torino and its Metropolitan City have reached a population of 2,3 million inhabitants, 1 million of which is under 45 years old. A Muslim community of about 50 thousand people has been living well integrated in the territory for many years: 40% of them have Italian citizenship.
Torino is an open and plural city that has developed policies and projects focused on religious pluralism and dialogue, through:
- the Interfaith Committee, promoted by the city administration in 2006 has been fostering the dialogue between different religious traditions.
- the “Patto di Condivisione e Cittadinanza” an Agreement signed at the City Hall on 19 February 2016 with all the 20 Islamic Centres based in Torino, to assert that Torino is a multi-ethnic, multicultural and multi-religious city supporting integration, sharing and mutual respect.
- it has been 20 years now since state schools in Torino have been offering the possibility to have specific diets to meet religious needs. Moreover, our schools have specific programs and projects focusing on intercultural education and religious pluralism.
- the Torino Airport Sandro Pertini has recently opened a prayer room dedicated to Muslims in addition to the already existing prayer rooms devoted to other faiths.
- an Arabic edition of the City website http://www.comune.torino.it/ar/
- the EidAl-Fitr celebration has been opened for the last 8 years by speeches given by representatives of the City and by representatives of the main religious faiths: Catholics, Jews, and Protestants.
- the Civil Service for Young Immigrants was established in 2006 following an agreement between the City and the Ministry for Social Solidarity which funded a programme addressed to second-generation immigrants, in particular those living in Torino but with no Italian citizenship, and therefore not allowed to apply for the National Civil Service.
- the Intercultural Centre of the City of Torino was founded in 1996 to offer opportunities of intercultural training, exchange and dialogue both to residents and migrants.
- the activities of the University Research Centre and of the European Journal on Islamic Finance, the first international scientific journal on this topic in Europe, have been active for many years.
The TIEF is stimulating new collaborations, ideas and projects toward an inclusive, sustainable and competitive development of the territory.
The Islamic economy and finance is growing and making an increasing contribution to the global economic growth. According to the Economist magazine (September 2014), Islamic finance grew at an annual rate of 17.6 percent between 2009 and 2013, faster than conventional banking and is estimated to be US$2 trillion in size. In 2010, Muslim population accounted for 1.7 billion representing 23.4% of total world population. According to the “State of Global Islamic Economy Report 2015/2016” of Thomson Reuters; the Islamic economy affects more than 1.7 billion Muslims in the world
The City of Torino thinks that Islamic finance is an effective tool to reach out to the Muslim community and integrate it , and that it can help attracting much needed investments to Torino from those countries where Islamic finance contributes to the economic development and creation of jobs.
Italy is the 3rd largest economy of the Euro zone and the 8th largest in the world, with a GDP of more than 2.1 trillion dollars. Torino is one of the largest industrial cities in Italy but also a cultural centre of excellence and has vastly diversified sectors that can be a perfect match for Islamic finance. Some of the sectors that will be discussed at TIEF 2017 are: Real Estate, Food, Insurance, Tourism, Health, Biotech, Infrastructure, Finance, Aerospace, Sports, and Automotive.
TIEF 2017 is a good opportunity to meet some of the relevant stakeholders of Italian companies, financial services providers, entrepreneurs, legislators & regulators, researches, professionals, and academics.
All are invited to meet up with Islamic finance investors and key market players.
Islamic finance is a system for all financial transactions that are conducted according to Sharia principles (Arabic word that refers to guidance for right way).
Islamic economics is mainly concerned about the distribution of wealth as a mean for achieving justice, equality, fairness, and economic equilibrium among the society.
The most important principles of Islamic finance include a prohibition for Riba “Usury”, prohibition of Gharar “uncertainty/speculation”, prohibition of Maysir “Gambling” and prohibition on investment in Non- Halal that is equivalent to Haram ‘unethical’ businesses, products or services (such as alcohol, tobacco, pork, pornography, and weapons).
The Islamic Finance exists in 75 countries worldwide with a total activity of $1000billion with assets expected to expand to some 3.4 trillion USD by the end of 2018. According to the Pew Forum on Religion and Public Life report, the Future of the Global Muslim Population is estimated that by 2030, Muslims will make up 27% of the world’s total projected population and that Muslims will reach in Europe 16.4 million or around 9 % of its projected population.
Global Muslim expenditure figures
Food and Beverage
According to the state of the global economy report 2016/17; Global Muslim consumer spending on Food and Beverage counted $1.17 trillion in 2015 representing17% of the global expenditure, with a growth of 3.4% than year 2014. Muslim spending on food and beverage is expected to reach $1.9 trillion by 2021. The Muslim consumer expenditure for food and beverage is ranked first, ahead of China ($854 billion), the United Sates ($770 billion), Japan ($380 billion), and India ($341 billion).
Muslims total expenditure on clothing in 2015 was $243 billion representing 11% of the global market spending on clothing. This figure has grown of 5.7 % from 2014. Muslim spending on clothing is expected to reach $368 billion by 2021. The Muslim market for clothing ranked third behind the United States ($406 billion) and China ($334 billion), and ahead of the United Kingdom ($114 billion) and Germany ($101 billion).
In 2015 global Muslim consumer spending on pharmaceuticals has increased by 4.2% from 2014 and reached $78 billion representing 7% share of the global expenditure on pharmaceuticals. Muslim spending on pharmaceuticals market is expected to reach $132 billion by 2021. The Muslim market for pharmaceuticals ranked fourth globally, behind the United States ($372 billion), Japan ($114 billion), and China ($109 billion).
Global Muslim spending on cosmetics in 2015 was $56 billion taking a 7% share of the total global expenditure. Muslim spending on cosmetics has increased in comparison to 2014 by 4%. Muslim spend on cosmetics is expected to reach $81 billion by 2021. The Muslim market for cosmetics is ranked fourth globally, behind the United States ($84 billion), Japan ($80 billion), and China ($63 billion).
Riba “usury” is prohibited. Riba is generally seen as unjustified earning, where a person cannot make money out of money. They agree that money could be lent for business purposes on the basis of profit and loss sharing (PLS).
Gharar “uncertainty” in Arabic refers to excessive risk and uncertainty. It refers to that all the terms and conditions of the risk and the contract for example between a buyer and seller are clearly understood and stated by all parties of the financial transaction. This leads to ensuring the full consent of all parties in a contract.
Maysir in Arabic means gambling like lottery and it is prohibited because of the unjustified gains and increase of wealth through games of pure chance is a transfer of wealth from one to another and this kind of transfer is done on the expense of the society.
Halal versus Haram Investments
Muslims are requested to acquire properties through allowed ethical activities which are defined in Arabic with the word Halal. These activities could be done through trading, and partnerships investments. On the other hand, Muslims are prohibited from Haram “unethical activities”. Haram unethical activities are represented not only in the riba, gharar, maysir but also for specific businesses and industries that are forbidden in socially and ethically manner. Prohibition includes investments in: pornography, alcohol, weapons, and pork related products.
Sukuk means certificates in Arabic (Sukuk is a plural for the word Sak) and it is an alternative to the conventional “Bonds”. Conventional bonds reflect a commitment by the borrower to repay the principle amount plus an agreed interest rate, but Sukuk are structured so that the returns are linked to the underlying asset, with the lender get ownership certificate on that asset.
The sukuk market offers a strong opportunity to drive infrastructure development. In 2014, the UK became the first Western government to sell an Islamic bond where it saw an unprecedented level of interest, attracting orders of GBP 2bn ($2.85bn) from global investors, and Luxembourg followed suit later that year with a EUR 200m ($254m) five-year Islamic bond.
Takaful is a risk sharing entity that is similar to traditional insurance that allows for the transparent sharing of risk by pooling individual contributions for the benefit of all subscribers. Sharia compliant insurance sector provides the critical risk management supports needed across the various markets offering Islamic financial services.
European Research Centre for Islamic Finance “ERCIF”
The European Research Centre for Islamic Finance of University of Torino (www.ercif.org) was created with the aim to enhance the diffusion of knowledge on Islamic Finance.
ERCIF has launched its academic scientific journal in 2014; the European Journal of Islamic Finance “EJIF” which is an open access online journal that publishes articles that contribute to the development of both the theory and practice of research methods employed across the whole field of Islamic Business and Management, Finance and Banking studies.