The head of the Union of Arab Banks likes to tell stories. Fictional stories. He is the latest in a long line of Islamists who have been spreading propaganda about “Islamic finance” being immune to the impact of the current global economic downturn.
Adnan Yousef claimed in a recent speech that the global financial crisis had no impact on Islamic banking.
Regular readers of SFW may recall that we profiled Adnan Yousef back in June:
I guess Adnan missed this report:
“Liquidity Woes Menace Islamic Banks”
And I am sure he overlooked this one too, since I wrote it:
“Shariah-Compliant Finance as a Safe Haven: Myth and Reality”
But Adnan also forgot about the report that RGE Monitor put out back in May, which we chronicled on SFW:
Adnan is also evidently ignorant of the troubles in the sukuk, or Islamic bond, market:
“Defaults Pose Latest Snag in Islamic Bond Market”
“Sukuk defaults expose pitfall in Shariah-Compliant Finance”
Things got so bad in “Islamic” markets back in March, that Dubai actually floated conventional bonds…
At that same time, Qatar had to bail out its Islamic banking system:
Bahrain Islamic Bank posted a loss in Q2:
In fact, Islamic bank earnings have been impacted in other places as well, but the state-controlled press in Islamic nations go to great lengths to conceal the facts:
The evidence is overwhelming: Shariah-Compliant Finance is in no way immune to the market forces which have created the global economic downturn and Shariah-Compliant Finance should not be regarded as any kind of safe haven at all.
Those who claim that Shariah Finance is in fact a safe haven are LYING.