COVID–19 NEWS   Owners of premises in buildings allowed to determine protocol on wearing of face mask at their venue - Johor Exco | Italy greenlights Omicron-adapted COVID-19 booster shots | New COVID-19 cases down 16.9 pct last week | Japan to simplify COVID-19 airport quarantine procedures | EMA endorses Omicron-adapted COVID-19 vaccines | 

Window of opportunity for Kazakhstan to be Islamic finance hub

18/07/2019 11:39 AM

From Siti Radziah Hamzah

KUALA LUMPUR, July 7 (Bernama) -- Kazakhstan’s Astana International Financial Centre (AIFC) aims to set itself up as the Islamic Finance hub in Central Asia and the Eurasian Economic Union, which has a combined population of more than 200 million. 

AIFC governor Kairat Kelimbetov said the centre has been looking into several potential areas to be developed, including Islamic finance, which currently accounts for less than one per cent of the country's total banking assets. 

Other areas include capital market, financial technology (fintech), asset management and private wealth management.   

He said Kazakhstan plans to develop the Islamic finance industry to create alternative financing sources for state and municipal projects, as well as private ones. 

Kelimbetov said the AIFC has been working with a number of Malaysian institutions, including Maybank and the Islamic research institute of Bank Negara Malaysia (BNM) for consultation purposes.  

Currently, the centre is commissioning Malaysia-based ZICO Shariah, a Shariah advisory service provider to develop a comprehensive five-year masterplan for Kazakhstan to develop its Islamic finance industry. 

"One of Kazakhstan government’s strategic goals is for the country to become a pioneer and play a leading role (in Islamic finance).  We believe that the Malaysian experience on sukuk issuance is a great example for us.

"We want to play a significant role in Kazakhstan and are working with the Ministry of Finance in the next two years to issue the first sovereign sukuk here," he told the international media recently at the conclusion of the Astana Finance Days 2019 convention in Nur-Sultan, Kazakhstan.

The list of financial institutions under the AIFC includes Abu Dhabi-based Al Hilal Bank. 

"We are working with Banque Misr from Egypt and we are now in the process of working with the authorities to allow them to establish a branch office in Kazakhstan," said Kelimbetov. 

Meanwhile, ZICO Shariah’s lead consultant, Professor Datuk Dr Mohd Azmi Omar said the framework that was being developed would be a dedicated and detailed masterplan for the development of Islamic finance and banking in Kazakhstan and the AIFC. 

"The framework also aims to build AIFC’s internal capacity in terms of executing and implementing the masterplan," he said in his presentation on the Islamic Finance masterplan during the convention. 

About 70 per cent of Kazakhstan’s total population are Muslims, and the combined Muslim population in Central Asia is about 80 million.

About 42 per cent of the population are between 24 and 54 years old -- forming a key retail growth driver. 

"According to the Thomson Reuters report, Kazakhstan ranks fifth in the Islamic investment destination among 57 OIC member countries.  

"Islamic finance currently represents less than one per cent of its total banking assets, with a plan to grow to 10 per cent by 2025. It is a big leap, so therefore the plan must also have a quantum leap to push it forward," said Mohd Azmi, who is also the president and chief executive officer of BNM’s International Centre for Education in Islamic Finance. 

He noted that the framework would incorporate a very important element -- the integration of halal industry and Islamic finance -- which is lacking in many countries. 

"Many countries develop Islamic finance without seeing how Islamic finance can support the halal industry and vice versa.

“Somehow, they forgot about the halal industry, as if the halal industry is a channel of its own,” said Mohd Azmi. 

Launched in 2018 and modelled on similar centres in Singapore and Dubai, the AIFC uses English as its main language, follows British securities and corporate law, and offers visa and tax waivers for global financial investors. 

AIFC members are exempted from Kazakhstan’s corporate income tax, individual income tax, land tax and property tax for 50 years.

The centre includes the AIFC Court, which is independent in its activities and separate from Kazakhstan’s judicial system, but has no jurisdiction over criminal and administrative proceedings. 

Additionally, its partners may benefit from services of the International Arbitration Centre, which has its own panel of world-leading arbitrators and mediators and allows for independent and speedy alternatives to court litigation.

Kelimbetov noted that the English Common Law  -- the basis of AIFC’s regulations -- was chosen because of its flexibility. 

"Most of the world's most successful financial centres operate in Common Law jurisdictions. This is due to the fact that it quickly adapts to the requirements of the market and at the same time guarantees investors' fairness and impartiality in making court decisions," he pointed out.   

The brainchild of the former Kazakhstani President Nursultan Nazarbayev, the AIFC is expected to become a catalyst for attracting foreign capital and bring Kazakhstan’s stock market to a new level of development.

The AIFC had also established the Central Shariah Advisory Board, led by Malaysia's Amanie Advisor Sdn Bhd founder and group chairman Datuk Dr Mohd Daud Bakar. 

Besides Mohd Daud, the five-member Shariah Advisory Board consists of scholars from Kazakhstan, Saudi Arabia, Bahrain and Pakistan.  

"Kazakhstan can learn from the best in the Islamic finance sector. With the new council, Kazakhstan could speed up the process to succeed in the industry," Mohd Daud told Bernama. 

The second Astana Finance Days, held from July 1- 4, saw participation from world experts, representatives of businesses, civil services, academics and international financial centres.  


Bernama is the trusted source of reliable real-time comprehensive and accurate news for both the public and media practitioners. Our news is published at ; BERNAMA TV on: Astro Channel 502, unifi TV Channel 631, MYTV Channel 121 IFLIX; and Bernama Radio broadcasting locally on FM93.9 in Klang Valley, Johor (FM107.5), Kota Kinabalu (FM107.9) and Kuching (FM100.9).

Follow us on social media :
Facebook : @bernamaofficial, @bernamatv, @bernamaradio
Twitter :, @BernamaTV, @bernamaradio
Instagram : @bernamaofficial, @bernamatvofficial, @bernamaradioofficial
TikTok : @bernamaofficial

© 2022 BERNAMA   • Disclaimer   • Privacy Policy   • Security Policy