Islamic Invitation Centre
Economic System
Q: Does Islam have an Economic System?
A: Yes.For more information, go to [The economic system of islam ]
A: No.
For more information, go to [Why Islam Is Against Lending Money At Interest ]
Q: Are pension schemes allowed in Islam?
A: Depends if it is in violation of several islamic injuncitons. For a detailed answer see [pension schemes].
Q: Is Insurance allowed in Islam?
A: There is a difference of opinion. Some scholars say that its not allowed, according to Islamic law, because insurance is not a contract of 'indemnity or bail' or surety ship (kifaalah), but is a contract of riba and qimaar.For more information, go to [What are the rulings on commercial insurance which is widespread nowadays? ]
However, some Islamic economists have looked for ways to provide the benefits of insurance while minimizing the elements of uncertainty. This is called takaful or cooperative insurance.
For more information, go to [takaful]
Q: Is Islam against Capitalism?
A: Yes. Capitalism is based on the concept that economics is that which examines man's needs, which are unlimited and how to satisfy these unlimited needs. The system depends upon the separation of church and state or in other words, the separation of the Creator from life's affairs. The concept of freedom plays a major role in the Capitalist ideology.
The Islamic economic system is derived from the only source that is capable of satisfying the needs and desires of everyone, without resulting in chaos. The source of these rules is our Creator.
"Seek the abode of the Hereafter in that which Allah has given you, and neglect not your portion of the world., and be kind as Allah has been kind to you and seek not corruption in the earth. " Qur'an.
What is the order of Capitalism? THE EXACT OPPOSITE! Within this Capitalist global system, the poor South (which is the home of the vast majority of the worlds Muslims) had to pay the rich North approximate 264 billion in debt servicing in 1998. It is estimated that more than a Million children die across the Developing World (a.k.a. Third World) each year because of debt payments. It should also be noted in 1990 the 20% of the worlds people who live in the richest countries had 40 times the income of the poorest 20%? And by 1995, 90 times as much income. What is even more distressing, the worlds 100 richest people have a combined wealth of over US$2 Trillion, equal to the annual income of the poorest 47% of the world’s people (2.5 billion). The three richest people have assets that exceed the combined GDP of the 48 least developed countries.
Whilst usury is based on the poor giving the rich, Zakat (alms giving), Obligatory alms for the poor, is the exact opposite. Please listen to the talk on The Prohition of Usury for more information.
Also, regarding Capitalism, go to [Capitalism and Islam: what's the difference? ]
Q: How will Islam resolve the economic problems of the world?
A: Yes, Islam will solve the economic problems of the World. Capitalism governs current global relations, condemning most of the world population to living under the sign of debt: i.e., each person born in Latin America owes already $1,600 in foreign debt; each individual being conceived in Sub-Saharan Africa carries the burden of a $336 debt, for something that its ancestors have long ago paid-off. In 1980 the Southern countries' debt amounted to $567 billion; since then, they have paid $3,450 billion in interests and write-offs, six times the original amount. In spite of this, that debt had quadrupled by the year 2000, reaching $2,070 billion.Few realise that 95 percent of each year's new money is generated by commercial banks as a debt and interest bearing burden upon the community and the creation.
Simply put, usury puts money from the poor into the hands of the rich, whereas, Zakaat (alms giving in Islam) puts money from the rich into the hands of the poor. THE EXACT OPPOSITE!