Islamic Finance Demonstrates Potential To Provide Solutions To Inclusion, Climate Change - World Bank

KUALA LUMPUR, Jan 13 (Bernama) -- Islamic finance has demonstrated its potential to provide innovative solutions in addressing challenges related to inclusion and climate change, said the World Bank today,

World Bank country manager for Malaysia Judith Green said global Islamic finance assets were estimated at US$3.9 trillion at the end of 2024 and there was significant potential to further leverage Islamic finance in alignment with the sustainable development goals (SDGs) and climate goals, building on the core principles of Islamic finance.

However, citing the newly launched World Bank-Islamic Development Bank “Islamic Finance and Climate Agenda” report, Green said the report estimated 4.6 per cent of global Islamic financing raised between 2017 and 2024 has been linked to green and sustainable activities.

“Clearly, Islamic finance can play a pivotal role in bridging a share of the global SDG funding gap,” she said in her welcoming remark at the launch of the report here today.

Green said the World Bank Group recognised the growing demand from its client countries to meet their climate financing needs through Islamic finance instruments as Islamic finance presents unique opportunities to mobilise resources in a manner that is both compliant with Islamic finance rules and aligned with sustainability objectives.

“The World Bank Group’s involvement in Islamic finance is directly linked to our work on expanding access to and use of financial services in client countries, particularly among the most vulnerable, including women.

“We have collaborated with client countries to adapt conventional financial products, making them shariah-compliant, thereby expanding the range of Islamic finance instruments,” she added.

-- BERNAMA