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islamic-finance · 5 years

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10 - The Performance of The Islamic Banks - A Realistic Evaluation

Islamic banking has become today an undeniable reality. The number of Islamic banks and the financial institutions is ever increasing. New Islamic Banks with huge amount of capital are being established. Conventional banks are opening Islamic windows or Islamic subsidiaries for the operations of Islamic banking.

Even the non-Muslim financial institutions are entering the field and trying to compete each other to attract as many Muslim customers as they can. It seems that the size of Islamic banking will be at least multiplied during the next decade and the operation of Islamic banks are expected to cover a large area of financial transactions of the world. But before the Islamic financial institutions expand their business they should evaluate their performance during the last two decades because every new system has to learn from the experience of the past, to revise its activities and to analyze its deficiencies in a realistic manner.

Unless we analyze our merits and demerits we cannot expect to advance towards our total success. It is in this perspective that we should seek to analyze the operation of Islamic banks and financial institutions in the light of Shari‘ah and to highlight what they have achieved and what they have missed.

Once during a press conference in Malaysia, this author was asked the question about the contribution of the Islamic Banks in promoting the Islamic economy. My reply to the question was apparently contradictory, I said it he has contributed a lot and they have contributed nothing. In the present chapter an attempt has been made to elaborate upon this reply. When it was said that they have contributed a lot, what was meant is that it was a remarkable achievement of the Islamic banks that they have made a great break- through in the present banking system by establishing Islamic financial institutions meant to follow Shari‘ah. It was a cherished dream of the Muslim Ummah to have an interest-free economy, but the concept of Islamic banking was merely a theory discussed in research papers, having no practical example. It was the Islamic banks and financial institutions which translated the theory into practice and presented a living and practical example for the theoretical concept in an environment where it was claimed that no financial institution can work without interest. It was indeed a courageous step on the part of the Islamic banks to come forward with a firm resolution that all their transactions will conform to Shari‘ah and all their activities will be free from all transactions involving interest.

Another major contribution of the Islamic banks is that, being under supervision of their respective Shari‘ah Boards they presented a wide spectrum of questions relating to modern business, to the Shari‘ah scholars, thus providing them with an opportunity not only to understand the contemporary practice of business and trade but also to evaluate it in the light of Shari‘ah and to find out other alternatives which may be acceptable according to the Islamic principles.

It must be understood that when we claim that Islam has a satisfactory solution for every problem emerging in any situation in all times to come, we do not mean that the Holy Qur’an or the Sunnah of the Holy Prophet صلى الله عليه وسلم or the rulings of the Islamic scholars provide a specific answer to each and every minute detail of our socio-economic life. What we mean is that the Holy Qur’an and the Holy Sunnah of the Prophet صلى الله عليه وسلم have laid down broad principles in the light of which the scholars of every time have deduced specific answers to the new situation arising in their age.

Therefore, in order to reach a definite answer about a new situation the scholars of Shari‘ah have to play a very important role. They have to analyze every new question in the light of the principles laid down by the Holy Qur’an and Sunnah as well as in the light of the standards set by the earlier jurists, enumerated in the books of Islamic jurisprudence. This exercise is called istinbat or ijtihad. It is this exercise which has enriched the Islamic jurisprudence with a wealth of knowledge and wisdom for which no parallel is found in any other religion. In a society where the Shari‘ah is implemented in its full sway the ongoing process of istinbat keeps injecting new ideas, concepts and rulings into the heritage of Islamic jurisprudence which makes it easier to find out specific answer to almost every situation in the books of Islamic jurisprudence. But during the past few centuries the political decline of the Muslims stopped this process to a considerable extent. Most of the Islamic countries were captured by non-Muslim rulers who by enforcing with power the secular system of government, deprived the socio- economic life from the guidance provided by the Shari‘ah, and the

Islamic teachings were restricted to a limited sphere of worship, religious education and in some countries to the matter of marriage, divorce and inheritance only. So far as the political and economic activities are concerned the governance of Shari‘ah was totally rejected.

Since the evolution of any legal system depends on its practical application, the evolution of Islamic law with regard to business and trade was hindered by this situation. Almost all the transactions in the market being based on secular concepts were seldom brought to the Shari‘ah scholars for their scrutiny in the light of Shari‘ah. It is true that even in these days some practicing Muslims brought some practical questions before the Shari‘ah scholars for which the scholars have been giving their rulings in the forms of fatawas of which a substantial collection is still available. However, all these fatawas related mostly to the individual problems of the relevant persons and addressed their individual needs. It is a major contribution of the Islamic banks that, because of their entry into the field of large scale business, the wheel of evolution of Islamic legal system has re-started. Most of the Islamic banks are working under the supervision of their Shari‘ah Boards. They bring their day to day problems before the Shari‘ah scholars who examine them in the light of Islamic rules and principles and give specific rulings about them. This procedure not only makes Shari‘ah scholars more familiar with the new market situation but also through their exercise of istinbat contributes to the evolution of Islamic jurisprudence. Thus, if a practice is held to be un-Islamic by the Shari‘ah scholars a suitable alternative is also sought by the joint efforts of the Shari‘ah scholars and the management of the Islamic banks. The resolutions of the Shari‘ah Boards have by now produced dozens of volumes—a contribution which can never be under-rated.

Another major contribution of the Islamic banks is that they have now asserted themselves in the international market, and Islamic banking as distinguished from conventional banking is being gradually recognized throughout the world. This is how I explain my comment that they have contributed a lot. On the other hand there are a number of deficiencies in the working of the present Islamic banks which should be analyzed with all seriousness.

First of all, the concept of Islamic banking was based on an economic philosophy underlying the rules and principles of Shari‘ah. In the context of interest-free banking this philosophy aimed at establishing distributive justice free from all sorts of exploitation. As I have explained in a number of articles, the instrument of interest has a constant tendency in favor of the rich and against the interests of the common people. The rich industrialists by borrowing huge amounts from the bank utilize the money of the depositors in their huge profitable projects. After they earn profits, they do not let the depositors share these profits except to the extent of a meager rate of interest and this is also taken by them by adding it to the cost of their products. Therefore, looked at from macro level, they pay nothing to the depositors. While in the extreme cases of losses which lead to their bankruptcy and the consequent bankruptcy of the bank itself, the whole loss is suffered by the depositors. This is how interest creates inequity and imbalance in the distribution of wealth.

Contrary to this is the case of Islamic financing. The ideal instrument of financing according to Shari‘ah is musharakah where the profits and losses both are shared by both the parties according to equitable proportion. Musharakah provides better opportunities for the depositors to share actual profits earned by the business which in normal cases may be much higher than the rate of interest. Since the profits cannot be determined unless the relevant commodities are completely sold, the profits paid to the depositors cannot be added to the cost of production, therefore, unlike the interest-based system the amount paid to the depositors cannot be claimed back through increase in the prices.

This philosophy cannot be translated into reality unless the use of the musharakah is expanded by the Islamic banks. It is true that there are practical problems in using the musharakah as a mode of financing especially in the present atmosphere where the Islamic banks are working in isolation and, mostly without the support of their respective governments. The fact, however, remains that the Islamic banks should have gressed towards musharakah in gradual phases and should have increased the size of musharakah financing.

Unfortunately, the Islamic banks have overlooked this basic requirement of Islamic banking and there are no visible efforts to progress towards this transaction even in a gradual manner even on a selective basis. This situation has resulted in a number of adverse factors :

Firstly, the basic philosophy of Islamic banking seems to be totally neglected.

Secondly, by ignoring the instrument of musharakah the Islamic banks are forced to use the instrument of murabahah and ijarah and these too, within the framework of the conventional benchmarks like Libber etc. where the net result is not materially different from the interest based transactions. I do not subscribe to the view of those people who do not find any difference between the transactions of conventional banks and murabahah and ijarah and who blame the instruments of murabahah and ijarah for perpetuating the same business with a different name, because if murabahah and ijarah are implemented with their necessary conditions, they have many points of difference which distinguish them from interest-based transactions. However, one cannot deny that these two transactions are not originally modes of financing in Shari‘ah. The Shari‘ah scholars have allowed their use for financing purposes only in those spheres where musharakah cannot work and that too with certain conditions. This allowance should not be taken as a permanent rule for all sorts of transactions and the entire operations of Islamic Banks should not revolve around it.

Thirdly, when people realize that income from in the transactions undertaken by Islamic banks is dubious akin to the transactions of conventional banks, they become skeptical towards the functioning of Islamic banks.

Fourthly, if all the transactions of Islamic banks are based on the above devices it becomes very difficult to argue for the case of Islamic banking before the masses especially, before the non- Muslims who feel that it is nothing but a matter of twisting of documents only.

It is observed in a number of Islamic banks that even murabahah and ijarah are not effected according to the procedure required by the Shari‘ah. The basic concept of murabahah was that the bank should purchase the commodity and then sell it to the customer on deferred payment basis at a margin of profit. From the Shari‘ah point of view it is necessary that the commodity should come into the ownership and at least in the constructive possession of the bank before it is sold to the customer. The bank should bear the risk of the commodity during the period it is owned and possessed by the bank. It is observed that many Islamic banks and financial institutions commit a number of mistakes with regard to this transaction:

Some financial institutions have presumed that murabahah is the substitute for interest, for all practical purposes. Therefore, they contract a murabahah even when the client wants funds for his overhead expenses like paying salaries or bills for the goods and services already consumed. Obviously murabahah cannot be effected in this case because no commodity is being purchased by the bank.

In some cases the client purchases the commodity on his own prior to any agreement with the Islamic Bank and a murabahah is effected on a buy-back basis. This is again contrary to the Islamic Principles because the buy-back arrangement is unanimously held as prohibited in Shari‘ah.

In some cases the client himself is made an agent for the bank to purchase a commodity and to sell it to himself immediately after acquiring the commodity. This is not in accordance with the basic conditions of the permissibility of murabahah. If the client himself is made an agent to purchase the commodity, his capacity as an agent must be distinguished from his capacity as a buyer which means that after purchasing commodity on behalf of the bank he must inform the bank that he has effected the purchase on its behalf and then the commodity should be sold to him by the bank through a proper offer and acceptance which may be effected through the exchange of telexes or faxes.

As explained earlier murabahah is a kind of sale and it is an established principle of Shari‘ah that the price must be determined at the time of sale. This price can neither be increased nor reduced unilaterally once it is fixed by the parties. It is observed that some financial institutions increase the price of murabahah in the case of late payment which is not allowed in Shari‘ah. Some financial institutions roll-over the murabahah in the case of default by the client. Obviously, this practice is not warranted by Shari‘ah because once the commodity is sold to the customer it cannot be the subject matter of another sale to the same customer.

In transactions of ijarah also some requirements of Shari‘ah are often overlooked. It is a prerequisite for a valid ijarah that the lessor bears the risks related to the ownership of the leased asset and that the usufruct of the leased asset must be made available to the lessee for which he pays rent. It is observed in a number of ijarah agreements that these rules are violated. Even in the case of destruction of the asset due to force majeure, the lessee is required to keep paying the rent which means that the lessor neither assumes the liability for his ownership nor offers any usufruct to the lessee. This type of ijarah is against the basic principles of Shari‘ah. The Islamic banking is based on principles different from those followed in conventional banking system. It is therefore logical that the results of their operations are not necessarily the same in terms of profitability. An Islamic bank may earn more in some cases and may earn less in some others. If our target is always to match the conventional banks in terms of profits, we can hardly develop our own products based on pure Islamic principles. Unless the sponsors of the bank as well as its management and its clientele realize this fact and are ready to accept different - but not necessarily adverse - results, the Islamic banks will keep using artificial devices and a true Islamic system will not come into being.

According to the Islamic principles, business transactions can never be separated from the moral objectives of the society. Therefore, Islamic banks were supposed to adopt new financing policies and to explore new channels of investments which may encourage development and support the small scale traders to lift up their economic level. A very few Islamic banks and financial institutions have paid attention to this aspect. Unlike the conventional financial institutions who strive for nothing but making enormous profits, the Islamic banks should have taken the fulfillment of the needs of the society as one of their major objectives and should have given preference to the products which may help the common people to raise their standard of living. They should have invented new schemes for house-financing, vehicle- financing and rehabilitation-financing for the small traders. This area still awaits attention of the Islamic banks.

The case of Islamic banking cannot be advanced unless a strong system of inter-bank transactions based on Islamic principles is developed. The lack of such a system forces the Islamic banks to turn to the conventional banks for their short term needs of liquidity which the conventional banks do not provide without either an open or camouflaged interest. The creation of an inter- bank relationship based on Islamic principles should no longer be deemed difficult. The number of Islamic financial institutions today has reached around two hundred. They can create a fund with a mixture of murabahah and ijarah instruments the units of which can be used even for overnight transactions. If they develop such a fund it may solve a number of problems.

Lastly, the Islamic banks should develop their own culture. Obviously, Islam is not restricted to the banking transactions. It is a set of rules and principles governing the whole human life. Therefore, for being ‘Islamic’ it is not sufficient to design the transactions on Islamic principles. It is also necessary that the outlook of the institution and its staff reflects the Islamic identity quite distinguished from the conventional institution. This requires a major change in the general attitude of the institution and its management. Islamic obligations of worship as well as the ethical norms must be prominent in the whole atmosphere of an institution which claims to be Islamic. This is an area in which some Islamic institutions in the Middle East have made progress.

However, it should be a distinguishing feature of all the Islamic banks and financial institutions throughout the world. The guidance of Shari‘ah Boards should be sought in this area also. The purpose of this discussion, as clarified at the outset, is by no means to discourage the Islamic Banks or to find faults with them. The only purpose is to persuade them to evaluate their own performance from the Shari‘ah point of view and to adopt a realistic approach while designing their procedure and determining their policies.

#The Performance of the Islamic Banks #Evaluation #Increasing #Middle East #Home Financing #Vehicle Financing #Ethical Norms #Faults #Positives

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ayittey1 · 5 years

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How Socialism Destroyed Africa

How Socialism Destroyed Africa George B N Ayittey, PhD

(Presentation at the Heritage Foundation on March 11, 2019 in Washington DC).

A. Introduction

I would like to thank David Burton for the invitation to speak at the Heritage Foundation and I would also like to thank you for finding some time to come and listen to this lecture.

It may interest to know that exactly 30 years ago I was a Bradley Scholar here at the Heritage Foundation. I was on loan from Bloomsburg University, Bloomsburg, PA and was supposed to return after a year. I chose not to return. I am sure you would like to know why but let me just say that it was because the intellectual environment was extremely hostile. Even today, I still meet a hostile reaction when I say African leaders failed and betrayed their people.

One must always make a distinction between African leaders and the African people. The two are not synonymous. The leaders have been the problem, not the people. There have been exactly 309 African heads of state since independence in 1960. I will challenge anyone to name me just 20 good leaders out of the lot. Nobody has been able to do so, meaning that the vast majority – over 90% – were utter failures.

Africans are angry – angry at the condition of Africa. When Africans fought for independence, they expected to have freedom and development. But true freedom never came to much of Africa after independence. All we did was to trade one set of masters (white colonialists) for another set of masters (black neo-colonialists) and the oppression and exploitation of the African people continued unabated.

In 1990, only 4 African countries – Botswana, Gambia, Mauritius and Senegal – were democratic. In January 2017, only 17 out of 54 countries are democratic – Benin, Botswana, Cape Verde Islands, Gambia, Ghana, Kenya, Malawi, Mauritius, Mozambique, Namibia, Nigeria, Sao Tome & Principe, Senegal, Seychelles Islands, South Africa, Tanzania and Zambia. At this rate – 12 democracies in 27 years – it will take Africa exactly 94.5 years to become fully democratic, other things being equal.

Where is our freedom? The truth about postcolonial Africa is ugly, embarrassing and not politically correct, which is why some people in the West do not want to hear it. But we can’t sweep it under the rug.

“Free at last!” was the euphoric freedom chant that rang across Africa in the 1960s. Africa had won its independence from white colonial rule. New national flags were unfurled to the sounds of new national anthems. Leaders who fought gallantly and won independence were hailed as heroes and deified. Their pictures were hung in every government building. Currencies bore their portraits. Statues were erected for them. Then they settled down to develop Africa in its own image, not to satisfy the dictates of European metropolitan centers. But with what model? The challenge was daunting.

After independence, the first generation of African leaders launched a frontal assault on what they perceive to be Western institutions. Kwame Nkrumah of Ghana, for example, rejected democracy as an “imperialist dogma” while others dismissed it as “luxury Africa could not afford.” Capitalism was rejected as a Western colonial ideology in one monumental syllogistic error. Colonialism was evil and since the colonialists were capitalists, it too was evil. Socialism, the antithesis of capitalism, was adopted by nearly every African leader and was advocated as the only road to Africa's prosperity. Nkrumah surmised that "socialist transformation would eradicate completely the colonial structure of our economy" (Nkrumah 1973; p.189). Additionally, Nkrumah believed "Capitalism is too complicated for a newly independent state; hence, the need for a socialist society" (Nkrumah,1957; p.9).

A wave of socialist ideologies swept across the continent as almost all the new African leaders succumbed to the contagious ideology, copied from the East. The proliferation of socialist ideologies that emerged in Africa, ranged from the "Ujamaa" (familyhood or socialism in Swahili) of Julius Nyerere of Tanzania; the vague amalgam of Marxism, Christian socialism, humanitarianism and "Negritude" of Leopold Senghor of Senegal; humanism of Kenneth Kaunda of Zambia; scientific socialism of Marien N'Gouabi of Congo (Brazzaville); Arab Islamic socialism of Ghaddafi of Libya; "Nkrumaism" (consciencism) of Kwame Nkrumah of Ghana; and "Mobutuism" of Mobutu Sese Seko of Zaire. Only a few African countries such as Ivory Coast, Nigeria and Kenya were pragmatic enough to eschew doctrinaire socialism.

Kwame Nkrumah of Ghana, generally regarded as the "father of African socialism," was convinced that "only the socialist form of society can assure Ghana of a rapid rate of economic progress without destroying that social justice, that freedom and equality, which are a central feature of our traditional way of life" (Seven Year Development Plan. Accra: Government of Ghana, 1963; p.1).

Julius Nyerere of Tanzania, on the other hand, misread the communalism of African traditional society as readiness for socialism, which he was first exposed to during his schooling in Scotland. He castigated capitalism or the money economy, which in his view, "encourages individual acquisitiveness and economic competition." The money economy was, in his purview, foreign to Africa and it "can be catastrophic as regards the African family social unit." As an alternative to "the relentless pursuit of individual advancement", Nyerere insisted that Tanzania be transformed into a nation of small scale communalists ("Ujamaa") (Nyerere, 1962).

Accordingly, the Tanzania African National Union Constitution acknowledged as the first socialist principle "that all human beings are equal" and pledged that the government would give "equal opportunity to all men and women”, and would eradicate "all types of exploitation" so as to "prevent the accumulation of wealth which is inconsistent with the existence of a classless society" (Republic of Tanzania, 1967, p.1). Tanzania’s Second Five-Year Plan for Economic and Social Development laid emphasis on the fact that "considerable benefit will accrue in the long run from the expansion of public ownership because (a) it will be possible to create a genuine Tanzanian industrial know-how faster than under conditions of unrestricted private enterprise; (b) it will be possible to pursue a more effective industrial strategy than is possible under private enterprise; (c) the profits made in industry will be re-invested in United Republic of Tanzania". Thus, the Government as the representative of the people regarded ownership of the means of production by Tanzanians as an "antidote to capitalist exploitation" (Second Five-Year Development Plan 1964-69; p.iix).

B. The Socialist Transformation

Under Nkrumah, socialism as a domestic policy in his Seven-Year Development Plan was to be pursued toward "a complete ownership of the economy by the state." A bewildering array of legislative controls and regulations were imposed on imports, capital transfers, industry, minimum wages, the rights and powers of trade unions, prices, rents, and interest rates. Some of the controls were introduced by the colonialists but they were retained and expanded by Nkrumah. By 1970, nearly 6,000 prices, relating to more than 700 product groups, were controlled in Ghana (World Bank, 1989; p.114). Private businesses were taken over by the Nkrumah government and nationalized. Numerous state enterprises were established.

In 1967, Tanzania's ruling party’s Arusha Declaration established a socialist state where the workers and peasants controlled and owned the means of production. The Arusha Declaration sought to encourage self reliance primarily through an expansion of agricultural production for domestic consumption.

Banks, insurance companies, and foreign trading companies were nationalized. A "villagization" program was adopted to encourage the communal production, marketing, and distribution of farm crops. In 1973, Tanzania undertook massive resettlement programs under "Operation Dodoma", "Operation Sogeza", "Operation Kigoma" and many others. Peasants were loaded into trucks, often forcibly, and moved to new locations. Many lost their lives in the process and to prevent a return to their old habitats, abandoned buildings were destroyed by bulldozers. By 1976, some 13 million peasants had been forced into 8,000 cooperative villages and by the end of the 1970s, about 91 percent of the entire rural population had been moved into government villages (Zinsmeister, 1987). All crops were to be bought and distributed by the government. It was illegal for the peasants to sell their own produce.

Ethiopia adopted a similar program  forced resettlements on government farms. In Mozambique, the Mozambican Liberation Front (FRELIMO) sought to establish a socialist state replete with collectivized agriculture, crop growing schemes and village political committees. According to Libby (1987):

The centerpiece of Frelimo's rural social program for Mozambique was the collectivization of agriculture into communal villages and cooperative farms. Agricultural cooperatives were intended to provide an integrated production base for the communal villages. Hence, villagization was designed to increase food and cash crop production and to make available common facilities for farming as well as provide social services such as education and health comparable with Ujamaa villages in Tanzania (p.216).

In the rest of Africa, planned socialist transformation of Africa meant the institution of a battery of legislative instruments and controls. All unoccupied land was appropriated by the government. Roadblocks, passbook systems were employed to control the movement of Africans. Marketing Boards and export regulations were tightened to fleece the cash crop producers. Price controls were imposed on peasant farmers and traders to render food cheap for the urban elites. Under Sekou Toure of Guinea's program of "Marxism in African Clothes,"

"Unauthorized trading became a crime. Police roadblocks were set up around the country to control internal trade. The state set up a monopoly on foreign trade and smuggling became punishable by death. Currency trafficking was punishable by 15 to 20 years in prison. Many farms were collectivized. Food prices were fixed at low levels. Private farmers were forced to deliver annual harvest quotas to `Local Revolutionary Powers.' State Companies monopolized industrial production" (The New York Times, Dec 28, 1987; p.28).

In Francophone Africa, industries were nationalized, tariff barriers erected and the state assumed near-total control of the national economy (Africa Analysis, Oct 2000). Rather interestingly, the World Bank, US AID, the State Department and even development experts from Harvard University supported these policies and channeled much aid resources to African governments (Bandow, 1986).

In Guinea, a state dominated socialist economy was set up beginning with independence in 1958, in Congo Brazzaville, a similar decision was taken in 1967, and in Benin, a socialist state was proclaimed in 1975. Even in avowedly capitalist countries like Ivory Coast, Kenya and Nigeria, the result became the same: government ownership of most enterprises, and a distrust of private-sector initiative and foreign investment, state controls as well as increasing state intervention in the economy.

In Nigeria, the state, in April 1971, acquired 40 percent of the largest commercial banks, and the Nigerian National Oil Company (NNOC) was established, with the government keeping a majority participation. Four years later the government acquired 55 percent of the petroleum industry and 40 percent of National Insurance Company of Nigeria (NICON). The following year the acquisition was extended to other insurance companies when the government took 49 percent of their shares.

Nigeria's Second Development Plan (1970 74) was unequivocal, declaring that: The interests of foreign private investors in the Nigerian economy cannot be expected to coincide at all times and in every respect with national aspirations. A truly independent nation cannot allow its objectives and priorities to be distorted or frustrated by the manipulation of powerful foreign investors. It is vital therefore for Government to acquire and control on behalf of the Nigerian society the greater proportion of the productive assets of the country. To this end, the Government will seek to acquire, by law if necessary, equity participation in a number of strategic industries that will be specified from time to time" (The Second National Development Plan, 1970 74: Program of Post War Reconstruction and Development, 1970, p.289).

C. The Results

Problems emerged soon after independence. State controls created artificial shortages and black markets. State-owned enterprises could not deliver, achieving very low rates of capacity utilization. Most of them were inefficiently run and unprofitable. At the time of the coup in Ghana in 1966, which overthrew Nkrumah, only 3 or 4 of the 64 state enterprises were paying their way (Garlick 1971; p.141). Consider the performance of these enterprises taken over by the state:

• In 1972, the government took over the African Timber and Plywood Company. Before the take over, "production was 75 percent of installed capacity but this has fallen to a woeful 13 percent" (West Africa Oct 12, 1981; p.2422).

• In 1976, the government of Ghana took over R. T. Briscoe, a foreign company. "Before the take over, the company was producing 241 buses in 1974. After the take over, production was 12 buses in 1977 and only 6 buses in 1978" (Daily Graphic, Jan 18, 1979; p.1).

In 1982, the Kenyan Government estimated the annual average rate of return on the $1.4 billion (1981 dollars) invested in SOEs since independence, in 1963, to be 0.2 percent——a return greatly less than what could have been obtained by depositing the sum in an interest-bearing account (World Bank, 2005).

In Tunisia, the government ran the airline, the steel mill, the phosphate mines, and 150 factories, employing a third of Tunisian workers. After 1990, the government sold off 35 companies and, Private businessman Afif Kilani bought one such company called Comfort, a featherbed for 1,200 workers who built 15,000 refrigerators a year. Mr. Kilani paid $3.3 million for the place in 1990. Five years later, he had whittled the workforce down to 600 workers who made 200,000 refrigerators a year. "Like all state companies, its point had been to support the maximum number of jobs”, he said. "It was social work. A sort of welfare”. (The Wall Street Journal June 22, 1995; p.A11).

In 1958, when Guinea gained its independence from France, it was considered to have the richest potential of Francophone Africa. It had one quarter of the world's bauxite as well as copious reserves of gold and diamonds. Prior to independence, Guinea was exporting food to neighboring French colonies, thanks largely to its fertile land. In addition, thousands of tons of bananas, pineapples, and coffee were shipped to Europe.

Proclaiming a doctrine of "Marxism in African clothes”, the first president, Ahmed Sekou Toure, set the country on a rigid course of state planning and controls. Recall that unauthorized trading became a crime. Private farmers were forced to deliver annual harvest quotas to "Local Revolutionary Powers”. Thousands of Guineans, who protested Toure's dictatorial rule, were imprisoned or executed. By 1984, at the time of Toure's death after 26 years of tyrannical rule, Guinea, once a food exporter, was spending a third of its foreign exchange earnings from bauxite on food. Further, saying “Nyet!” to Toure’s crass revolution, as many as two million Guineans fled to neighboring countries and Europe to live as voluntary exiles.

Study after study produced a damning indictment of SOE performance continent-wide. For example, in twelve West African countries, 62 percent of surveyed SOEs showed net losses, and 36 percent were in a state of negative net worth. By the end of the 1970s, cumulative SOE losses in Mali amounted to 6 percent of GDP. A 1980 study of eight Togolese SOEs revealed that losses in this group alone equaled 4 percent of GDP. In Benin, more than 60 percent of SOEs had net losses; more than three-fourths had debt/equity ratios greater than 5 to 1; close to half had negative net worth, and more than half had negative net working capital (World Bank, 2005).

In Tanzania, the agricultural economy was left devastated by state controls. Production of most crops showed a steady decline after 1974. Overall output of food crops rose only 2.1 percent between 1970 and 1982, well below the population growth of 3.5 percent. By 1981, a food crisis had gripped the nation, turning it into a net importer of basic foodstuffs. The country had to import one million tons of grain to avert population starvation. The towns and cities had to be supplied with imports of grain costing as estimated 2,000 million shillings (Libby 1987; p.254). In 1971/72, grain imports were 135,000 tons, including 90,000 tons of maize. In 1972—73, grain imports dropped to 90,000 tons, of which 80,000 tons were maize. However, during the next year from August 1973 to July 1974, Tanzania was forced to import over 500,000 tons of maize alone (African Business 1979; p.21). For eight years (1974-1982), Tanzania’s income per capita had remained stagnant at $210 (World Bank 2000; p.35). Exports of agricultural produce were similarly affected Exports of cotton have fallen to pre independent volumes and sisal output is less than a third of its 1961 total. In the last ten years, the annual cashew exports fell from 140,000 to 30,000 tons. The total tonnage of all export crops was 20 percent less in 1984 than it had been in 1970. Production of basic food crops, such as maize, rice and wheat, have also declined to half their 1972 levels. And, as could be expected, food imports have doubled" (Zinsmeister, 1987; p.33).

In Zimbabwe, the devastation was almost total. Upon independence in 1980, President Robert Mugabe openly stated his determination to make Zimbabwe a one party nation and his Zimbabwe African National Union (ZANU) party "a truly Marxist Leninist party to ensure the charting of an irreversible social course and create a socialist ideology”. Indeed, in December 1982 all 57 ministers and deputy ministers in Mugabe's cabinet arrived at the Harare airport to greet visiting Ethiopian leader Mengistu Haile Mariam—black Africa's arch-apostle of Marxism-Leninism. Inheriting an economy that was hobbled by racial inequalities under the former white-minority regime, there was a strong need for statism, to correct injustices committed by white colonialists.

The country was the bread basket of the region. But state controls, state regulations and forcible seizures of white commercial farmlands without compensation destroyed agriculture and turned the country into a net food importer.

The economy declined progressively. Corn production dropped sharply from 2 million tons in 1981 to 620,000 in 1983. Shortages of commodities and foreign exchange were rampant. The cost of living rose astronomically. By 2008, things had gotten progressively worse. Inflation was raging at 2 million% and unemployment was at 80%. In 2009, the currency collapsed and the US dollar was adopted. About 4 million fled to neighboring countries. In October 2017, Mugabe was driven out of office and was succeeded by Emmerson Mnangagwa, his former security chief.

D. Reasons for Failure

1. Exploitation and Oppression

Many governments not only nationalized European companies, ostensibly to prevent "foreign exploitation", but also vented their rage against the natives. In many other countries, the natives were squeezed out of industry, trade, and commerce, and the state emerged as the domineering, if not the only, player. Indigenous operators were not tolerated. Indeed, there was a time when the director of the Club du Sahel, Anne de Lattre, would begin her meetings with the frightening remark, "Well, there is one thing we all agree on: that private traders should be shot" (West Africa, Jan 26, 1987; p.154).

Unbelievable brutalities were heaped upon peasant farmers and traders under Ghana inane price controls (1982-1983). Ghanaian cocoa farmers in 1983 were paid less than 10 percent of the world market price for their produce. In Gambia, peanut producers received about 20 percent for their produce in the same year. According to West Africa (Feb 15, 1989):

“On the average, between 1964/65 and 1984/85, the peasants of Gambia were robbed of 60 percent of the international price of their groundnuts! For 20 years, the Jawara Government `officially' took, free of charge, 3 out of every 5 bags, leaving the peasant with a gross of 2. With deductions for subsistence credit fertilizer, seeds, etc., the peasant would end up with a net one bag out of five . . . With these facts, it is simply wrong to say that the poverty of the peasant derives from the defects of nature drought, over population, laziness, and so on (p.250).

In 1981, the Government of Tanzania paid peasant maize farmers only 20 percent of the free market price for their produce. "Studies by the International Labor Organization have indicated that taxation levels in the agricultural sector in Sierra Leone averaged between 30 and 60 percent of gross income" (West Africa, 15 Feb 1982; p. 446).

In Zambia, when traders refused to sell their produce at government dictated prices, authorities raided markets in May 1988. They arrested hundreds of people, took their money, and tore down market stalls, seizing sugar, detergents, salt, maize meal, soft drinks, candles, flour, and clothing. Back in 1984 in Ghana, “some unidentified soldiers who made brief stopovers at Swedru to check prices, robbed innocent traders” (West Africa, July 23, 1984; p.1511).

In this way, the peasantry was systematically robbed of considerable resources. For example, in a January 1989 New Year's address, President Houphouet-Boigny of Ivory Coast admitted that, over the years, peasant cash crop producers "have over the years parted with four-fifths of the value of what they produced to enable the government to finance development" (West Africa, May 1-7, 1989; p.677). But development for whom? About 70% of Ivory Coast’s development was concentrated around Abidjan, capital, for the elite -- not the farmers.

Eventually, the peasantry rebelled. Farmers decided that they would no longer produce surpluses for the state to expropriate. Beginning in the 1980s, production of food and cash crops began to decline across Africa.

2. Administrative Ineptitude

State owned enterprises were acquired haphazardly with little planning, resulting in grotesque blunders and mismanagement. There is extensive evidence for these, but suffice it here to give a few dramatic examples. • In Ghana, two tomato canneries were built in different parts of the country. The capacity of either one of them would have met the total domestic demand (Killick 1978; p.229).

• It took six years to complete Ghana's state footwear corporation factory and by the time it was ready to go into production much of its equipment was obsolete (Killick 1978; p.231).

• The Ghana government owned sugar factory at Komenda, after completion, stood idle for more than a year because it lacked a water supply system (Killick 1978; p.231).

• In Uganda and Angola, some high rises lacked glass panes and running water. In Mali, a Soviet built cement factory at Diamou was designed for a capacity of 50,000 tons a year. Beset by regular breakdowns, it produced only 5 tons in 1983 (Time, Jan 16, 1984; p.27).

• Ghana's State Meat Factory at Bolgatanga, which produces the VOLTA corned beef, was closed for 9 months. Yet, employees received full pay (West Africa, Nov 30 1981; p.2884).

• A Yugoslav company built a mango processing plant in Ghana with a capacity exceeding the entire world's trade in canned mangoes. When the factory was commissioned in 1964, it was discovered that the supply of mangoes came from a few trees scattered in the bush (Killick 1978; p.229).

Western governments and development agencies failed to exercise prudence in granting aid and loans to African governments. Much Western aid to Africa was used to finance grandiose projects of little economic value and to underwrite economically ruinous policies. There are many horrifying blunders. In the 1980s, Canada funded a fully-automated modern bakery in Tanzania but there was no flour to bake bread. In Somalia, the Italian funded a banana-boxing plant but the production capacity needed to make the plant break even exceeded the country’s entire output of bananas. And in northern Kenya, Norwegian aid officials built fish-freezing plant to help the Turkana people in 1971 at a cost $21 million. The only problem was the Turkana people do not fish; they raise goats (The Associated Press, Dec 23, 2007). According to The Wall Street Journal (July 29, 1985): The U.S. built 50 crop storage depots in 1983 in Senegal and placed them in locations the peasants never visited. In Uganda, a railroad expert discovered to his amazement that a repair shop built with foreign aid was seven times as large as the one he ran in Germany. A fifth of Ivory Coast's foreign borrowing went to build two sugar mills that started production just four years ago and now are closed. In Sudan, the Soviets built a milk bottling plant at Babanusa. Babanusa's Baggara tribesmen drink their milk straight from the cow and there aren't any facilities to ship milk out of Babanusa. The 20 year old plant hasn't produced a single bottle of milk. (p.18)

But the mother of all state-owned enterprises can be found in Nigeria – the Ajaokuta Steel Mill. In 1975, Nigeria purchased a Russian made steel-making furnace. But it was built on a site so remote from iron and coal mines as to render it useless. Subsequently, Russian, German and French technicians spent billions of naira to make it operational. They did not work. Known as the Ajaokuta steel mill, the government made fruitless efforts over the decades to resurrect it. By 2017, “The Ajaokuta steel that had reached 98 per cent completion as far back as 1994 had not produced a single steel till date . . . The federal government had spent over $10 billion over 34 years and would require another $2 billion to complete the remaining two per cent of the plant” (Premium Times, Dec 26, 2017).

By 2019, it had attracted $8 billion in additional government subsidies without producing a single beam of steel. Yet, over 100,000 workers were on the payroll drawing pension (The Economist, Feb 8, 2019).

3. Venal Tendencies/Corruption

State controls created artificial shortages, providing rich opportunities for rent-seeking activities and illicit enrichment. Import and exchange controls were the most lucrative. Ministers demanded 10 percent commission before issuing an import license. Everyone was chasing scarce commodities to buy at government-controlled prices and resell on the black market to make a profit – a process known in Ghana as “kalabule.”

More perniciously, the ruling elites discovered that they could not only use state controls to enrich themselves but also to punish the political rivals. For example, they would deny import license to import newsprint to newspapers that were critical of them.

More annoying was the out and out betrayal and theft by many of the first generation of leaders. “Only socialism will save Africa!” they chanted in the 1960s. But the socialism they practiced was a peculiar type of “Swiss-bank socialism,” which allowed the head of state and a cohort of ministers to rape and plunder state treasuries for private accounts in Swiss and other foreign banks. Askeed to define socialism, a Zimbabwean official said, “Here in Zimbabwe, socialism means what’s mine is mine, but what’s yours we share!”

Indeed, in Zimbabwe, $15 billion of revenue from the Marange diamond fields was plundered by the ruling elite in 2015 (New Zimbabwe, March 5, 2015). In Mozambique, $2 billion in loan proceeds simply vanished in 2018. Ndambi Guebuza, “he oldest son of former president Armando Guebuza was arrested on that debt scandal” (Daily Nation, Jan 17, 2019). A 2011 report commissioned by the United Nations Development Fund “said that between 1990 and 2008, $34 billion disappeared from Angola’s public coffers” (The Wall Street Journal, Oct 15-16, 2011; p.A10). Isabel dos Santos, the daughter of former president, Eduardo, who ruled for 38 years, is the richest woman in Africa with a net worth of $2.2 billion (Forbes, March 8, 2019). Her father, Jose Eduardo, was worth $20 billion (The Citizen, Oct 4, 2017). Meanwhile, some 65% of Angolans remain poor and lack access to clean water, electricity and sanitation.

If you want to understand why America is rich in Africa is poor, ask yourself this question: H ow do the rich in both places make their wealth? Here in America, the richest person is Jeff Bezos of Amazon.com. He created it and has something to show for it. In fact, 80% of US billionaires are problem-solvers. Now let’s go to Africa. Who are the richest? The richest in Africa heads of state and ministers. Quite often, the chief bandit is the head of state himself. How did they make their money? By raking it off the backs of their suffering people. What did they create? Nothing. In fact, none of Africa’s billionaire presidents made their wealth in the private sector. So, how do they teach the youth about wealth creation?

Here is a list of Africa’s billionaire presidents:

NAME LOOT

Mobutu Sese Seko $1 - $5 billion (Forbes, Nov 8, 2011) (Zaire, now Congo DR)

Charles Taylor (Liberia) $5 billion (BBC News, May 2, 2008 http://news.bbc.co.uk/2/hi/africa/7379536.stm)

The late Gen Sani Abacha (Nigeria) $5 billion (Sunday Times, Dec 17, 2000. and $1 - $5 billion (Forbes, Nov 8, 2011)

Omar al-Bashir (Sudan) $9 Billion (BBC News Africa, Dec 18, 2010)

Gen Ibrahim Babangida (Nigeria) $12 billion (Forbes, Nov 8, 2011)

Ben Ali (Tunisia) $13 billion (The Wall Street Journal, June 20, 2011)

Hosni Mubarak (Egypt) $40 billion (The Sun, Jan 11, 2011)

Muammar Khaddafi (Libya)i $200 billion (Los Angeles Times. Oct 21, 2011: http://articles.latimes.com/2011/oct/21/world/la-fg-kadafi-money-20111022\

“Every military regime is a fraud. Anybody who heads a military regime subverts the wishes of the people” – said General I.B. Babangida (rtd), former head of state of Nigeria (The African Observer, Jan 18-31, 1999; p.6). He should know; he stole $12 billion.

The Atlantic Monthly (May 20, 2010) provided an analysis of the net worth of all 43 U.S. presidents – from Washington to Obama – and found the combined net worth to be $2.7 billion in 2010 dollars. Evidently, Abacha, Babangida, Bashir, Houphouet-Boigny, and Mobutu each [stole more than the net worth of all U.S. presidents combined!

4. Alien ideology

Socialism can never be justified upon the basis of African tradition. The basic economic and social unit in the West is the individual. The American says “I am because I am and I can do anything I want at any time.” The emphasis is on the “I,“ the individual. In Africa, a person says ”I am because we are.” The “we” connotes the extended family, group or community. Land, for example, is owned by the extended family, so the African would say that “the land belongs to us.” The early Europeans misinterpreted that to mean land belonging to every Tom Dick and Harry in the village, which gave rise to the myth of communal ownership. The extended family pools is resources together and may share them among its members but the extended family is a private entity, not the tribal government. Many of the leaders and scholars mistook these aspects of African cultural heritage – helping one another, community awareness, sharing of resources, and so on – as a justification for African socialism. They were wrong.

In traditional Africa, one does not have to line up before a chief‘s palace to seek permission to engage in trade or some occupation. There were free markets, free enterprise and free-trade in Africa before the colonialists arrived. Perhaps, this was the most singular reason why socialism failed miserably in Africa because it is an alien ideology.

E. Aftermath

Nkrumah was overthrown in a military coup in 1966. But his statist experiment did not end then. Successive Ghanaian governments retained, and in some cases expanded, the state interventionist behemoth Nkrumah had erected. Foreign mining companies were subsequently nationalized. More state enterprises were set up and a denser maze of controls were placed on prices, rents, interest, foreign exchange exports, and imports. “The Ghana government owns nearly 90 percent of the companies doing business in the country. There are nearly 340 plus state-owned enterprises. Out of this number, only 17 have posted improved figures to date” (Ghana Drum Oct 1992; p.17).

The socialist ideology has left two pernicious legacies that will hold Africa back for some time to come. The first is socialist mentality – the tendency to look up to the government or the belief that government must solve every problem. This can be discerned from the following instances:

• Ask them to trim their bloated bureaucracies and cut government spending and they will establish a “Ministry of Less Government Spending” (Mali). • Ask them to establish a market-based economy and place more emphasis on the private sector and they will create a “Ministry of Private Enterprise,” as Ghana did in 2002. • Ask them to establish good governance and they will set up a “Ministry of Good Governance” (Tanzania). Don’t ask them to improve transparency!

Second, the state machinery and infrastructure that were erected in the 1960s to give effect to socialism were not dismantled. This has led to a phenomenal growth in the public sector that is now packed with cronies, relatives and party hacks in a multiplicity of parallel institutions and ministries with overlapping functions. Ghana, for example, has Ministry of Aviation, Ministry of Roads and Highways, Ministry of Transport, Ministry of Roads and Transport, Ministry of Ports and Railways. Why not just one Ministry of Transportation?

Bloated bureaucracies are riddled with willful dissipation of public funds, financial irregularities and profligacy. Ghost workers abound:

• In Ghana, there were over 6,000 ghost workers on government payrolls and their salaries collected by living workers in Ghana (Ghana Web, Dec 13, 2014). • In Nigeria, 62,893 ghost workers were nabbed and hopefully reburied (African Leadership, Feb 18, 2015). • Of the 1.2 million civil servants in Congo DR, an astonishing 500,000 were found to be ghost workers (Der Spiegel, June 5, 2017).

In 2009, Kenya had 94 ministers and deputy ministers; Zimbabwe had 82. Angola checked in with 88. Ghana, with a population of 25 million, had 97 cabinet and regional ministers plus their deputies in 2009. By 2017, the number had grown to 110 -- the largest in Africa.

In addition, there are ministers of state at the presidency, presidential staffers and advisors. At each ministry, there are a principal secretaries, deputy principal secretaries, assistant deputy principal secretaries, etc. The next batch comprise governors or regional ministers and their deputies. Then there is the legislature – Senators and MPs, all feeding off the government trough.

Then each Minister must have a government bungalow (house), a Pajero (SUV), a saloon car for Madam, a garden boy, a cook, a day watchman, a night watchman and a security guard to accompany the official. Then each senior government officer is entitled to a house loan, furniture loan, fridge loan and even an education loan for the children. These perks were offered by the colonial masters to their subjects to entice them to serve in the colonies, but hardly made sense to retain them after independence. Nigerian legislators are highest paid in the world. Its Senators enjoy an obscene smorgasbord of perks and allowances that take their salaries to a cool $2 million each when 60% of the population earn less than $2 a day. An outrageous perk is "hardship" allowance.

The huge government workforce consumes 70 percent of Ghana’s budget; 80% in Zimbabwe. This means that the government has little savings left for capital expenditures for development.

South Africa

Strange as it might sound, the ruling elites in South Africa are poised to repeat the catastrophic mistakes we made in sub-Saharan Africa. Some senior members of the ruling ANC seek constitutional amendment to seize white-owned land without compensation and a breakaway faction, the Economic Freedom Fighters (EFF) seek to nationalize the central bank and all new discoveries of oil and gas – all this in the teeth of the disastrous socialist experiment right next door in Zimbabwe.

It needs to be emphasized that one of the cruelest jokes perpetrated on a gullible world was the misconception that the South African economy under apartheid was a "capitalist and free market”.

Under apartheid, the South African economy was characterized by severe state interventionism: where blacks could live and work, and what type of jobs they could take, were all determined by the state. The fictional link of apartheid to capitalism remained well into the 1990s, even though the National Party government operated a horrendous array of programs to maintain a heavy presence in the economy.

Apartheid must be repudiated but it was not capitalism. Colonialism needed to be repudiated but it was not capitalism. Albert Einstein once defined insanity as doing the same thing again and again and expecting different results. Lunacy may be defined as doing the same stupid thing again and again and expecting the same stupid results.

Thank you.

REFERENCES

Government Publications

Seven Year Development Plan, 1963 -1970. Accra: Government of Ghana, 1963.

"African Socialism and its Application to Planning in Kenya”. Sessional Paper No. 10. Nairobi: Republic of Kenya, 1965.

Tanzania’s Second Five-Year Plan for Economic and Social Development. Dar-es-Salaam: Republic of Tanzania, 1967.

The Five-Year Development Plan, 1990-1995. Harare, Zimbabwe. Government Printer.

Other Sources

Ayittey, George B.N. Africa Betrayed. New York: St. Martin’s Press, 1992.

___________ (2005) Africa Unchained. New York, NY: Palgrave/McMillan.

___________ (2018) Applied Economics for Africa. Washington, DC: Atlas Network.

Bandow, Doug (1986). "The First World's Misbegotten Economic Legacy to the Third World", Journal of Economic Growth, Vol. l, No.4: l7.

Garlick, Peter (1971). African Traders and Economic Development. Oxford: Clarendon.

Killick, Tony (1978). Development Economics In Action: A Study of Economic Policies in Ghana. London: Heinemann.

Libby, Ronald T. (1987). The Politics of Economic Power in Southern Africa. Princeton: Princeton University Press.

Manning, Patrick (1988). Francophone Sub Saharan Africa l880 1985. New York: Cambridge University Press.

Nkrumah, Kwame (1957). Ghana; An Autobiography. London: Nelson.

_____ _________ (1973). Revolutionary Path. New York: International Publishers.

Nyerere, Julius K. (1962). Ujamaa: The Basis Of African Socialism. Dar es Salaam: Government Printer.

World Bank (1989). Sub-Saharan Africa: From Crisis to Self-Sustainable Growth. Washington, D.C.: World Bank.

___________ (2000). Can Africa Claim the 21st Century? Washington, DC: World Bank publication.

World Bank, 2005. The Evolution of Enterprise Reform in Africa: From State-Owned Enterprises to Private Participation in Infrastructure—and Back. Technical Paper Series; No.84. Washington, DC.

Zinsmeister, Karl (1987). "East African Experiment: Kenyan Prosperity and Tanzanian Decline," Journal of Economic Growth, Vol.2. No.2:28.

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dauddaahir-blog · 5 years

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Future of Islamic banking in Somalia

Somalia’s financial system has been decimated by more than two decades of conflict. In January 1991, all state institutions that provided services and regulated the economy collapsed, including the Central Bank and the entire banking system. Somalia Economy was deeply depending on Money Transfer Companies (Hawala System) which have arisen with the hope to fulfill the gap and deliver some of basic banking services. As a result, Hawala System becomes the major financial institutions in the country due to their faster and cheap service charges, growing public trust and the reliability on its service and due to having agencies across the world, which are handling up to $1.5 billion in remittance annually to the home land. The role of the Hawala system is not ended with transferring money from overseas to back home, but it plays important role in trade and local investment financing since there is was no investment and commercial banks in Somalia. Moreover, the Hawala system acts as a saving bank by accepting the public deposits in its current and saving accounts. One of the quickest and the most practical ways of establishing a functioning banking system in Somalia is the conversion of the existing Hawala companies into Islamic banks.

Somalia has developed Financial Institution Law No. 130/2012, which provides the general guidelines of operation of financial institutions, both Islamic and conventional. This situation leaves the financial industry to accommodate and to be open for conventional financial institutions. At present the financial sector is composed of the Central Bank of Somalia, Somali Remittance Companies, Newly opened Islamic banks and Micro-finance institutions (as pilot projects in the North-Western Regions-Somaliland and in the North-Eastern Regions-Puntland).

The Islamic banking industry has been growing at an exponential pace generally, with assets displaying a robust growth of about 15-20 percent annually. As Somalia endeavors to reconstruct its shattered economy, a viable commercial banking sector will be crucial. Many literatures propose that a well-developed financial system plays an independent role in encouraging long run economic growth. The country’s financial system is growing faster in the last few years. As of now, there are five licensed Islamic banks in Somalia four of them have their headquarters in Mogadishu and one in Garoe- the Amal bank. It is believed that there are more than these registered ones since the autonomous states have their own central banks. Somaliland, which is a self-declared state, has its own central bank that runs and regulates its financial affairs. In addition, there are 14 Hawala-Remittance companies, which is a method of transferring money without any actual movement. Transactions between Hawala brokers are done without promissory notes because the system is heavily based on trust-Amanah. Another institution, which is prominent in Somalia, is Takaful Company “Islamic insurance” in 2014, the first Somali insurance company opened for more than 20 years in Mogadishu intended to delivering on Sharia compliant insurance products to any part of the country and across the world.

Fostering serious economic development is an inherent key objective of Islamic banks as they seek to maximize social benefit. Islamic banks in Somalia should therefore work hard to overcome shortages and difficulties to help the economy to progress to a higher stage of self-sustained development, resulting in a favorable effect on socio economic harmony due to equal income distribution. It is obvious that Islamic banking system is more suitable to the financial services needs of Somalia due to its dire need for a financial system with strong inclination to social justice and financial inclusion.

Although Islamic banking has grown over the past decade, it faces hostile challenges, including lack of financial regulation, Sharia advisory council, Supportive institutional and skilled labor. In lighting this Islamic banks came into existence in an environment where the laws and institutions are set to serve an economy which is open for interest-based banking. Similarly, local Islamic banks without having an interest-free money and capital market, will not have adequate instruments to meet the pre-condition for liquidity management and effective maturity transformation.

Lastly there are two options for Somalia to develop its Islamic banking business further. The first is the modernization of traditional Hawala systems with their transfer of private funds to transfer banks with additional banking services.

The second option is to open up more of the country to foreign and international operating banks, which not only raises professionalism in the Somali banking system, but can also contribute to the growth of cross-border financing, which has declined significantly in the years of crisis. Naturally, this solution requires a firm legal framework not yet provided by the Somali authorities, so that foreign banks can open their own branches or engage in joint ventures with local banks.

However, most industry players are also aware of the severe institutional shortcomings and the absence of a rule of law that could significantly hinder the improvement of the Somali banking sector unless it is adequately addressed, making it a political priority.

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islamicfinance1 · 2 years

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What is Halal Investment?

We all know that the Muslim population is globally growing day by day, and similarly, the need to invest in trade and work within Sharia Complaints is increasing too. For Halal investment, the investors should know everything about its products and services and how they work. And then, they can decide if the investment is in line with Islamic principles or not.

For Muslims, it is important to ensure that all the sources of income in Halal investment are according to the Sharia rules and regulations. Islamic finance gives huge importance to Halal income resources enriched in the Quran. Historically, Halal and Haram is the most prominent concept for livelihood, but the concept of Halal and Haram should be applied to all things except food. It can be your lifestyle, finance, investment and business too.

How Halal investment works?

In halal investment, you can invest your surplus money and become partners to the projects with Afiyah. You can then share profit and loss as per the Sharia-compliant financing principles.

Halal investors welcome the opportunity to coordinate with investors willing to finance the entire or the part of the project in ratio to its value. The investors of Sharia-compliant loans are ready to share a pre-agreed percentage of the profit and losses.

An investor can have transparency on the progress, execution, and completion of the projects invested. We at Afiyahs do not promote speculations in investment contracts so that an investor remains comfortable with the Halal investments entrusted with us.

Concept of Sharia Compliant and Halal investment

When you invest money according to Islamic finance principles, it is called Halal Investment. Sharia finance principles are based on social concepts like justice, ethics, and community development. All Muslims making Halal investments should focus on mutual partnership and risk-sharing factors. Sharia law has made principles and regulations for all Muslim investors, and they have to follow each of these principles if they are investing in Halal products. It is a category of ethical and socially responsible investment.

Those who want to generate profit from the income should not dismiss Halal investments. Islamic finance is not restricted but promotes ethical practices and mutual benefits. Halal investments encourage all Muslims to invest ethically. It is not impossible to invest money ethically with the right investor. Islamic banks could withstand the economic collapse in 2008 due to Sharia Compliant investment. If you follow the principles of Islamic finance while investing your money, you are safe from all risk factors.

Know the benefits of Halal investments

Halal investment is growing globally among Muslims that is why the Islamic finance industry is growing year on year. In the following lines, we will discuss some essential benefits of Halal investments:

The principle of participation in the heart of Islamic finance brings growth in your wealth with productive activities only.

It is a moral duty of a transacting party to disclose all the essential information of a contract.

It reduces the discordance of rules and regulations in a contract. Else the Gharar can nullify the contract.

It determines a robust link between finance and the real economy.

For this, you should respect and safeguard the property rights of others for sustaining contractual commitments by stressing the holiness of contracts.

It ensures a link between real and other financing activities.

Following are the basic features of Halal investments

1. Social Responsibility - Halal investment takes a socially responsible approach to finances and investment. It also protects human rights, equal distribution of wealth, and ethical investment to decrease environmental deployments.

2. Less risk: - Islamic finance principles, or you can say the halal investment products are less open to market fluctuations. Islamic financing does more traditional banking and is not affected by the global crises. Sharia Compliant principles do not allow short term speculation, so you get much lower exposure overall.

3. Growing income resources in a halal way - Growing income resources is an advantage for all Muslim investors in Halal financing. Halal investment means Muslims can make a disciplined investment with ethical diligence.

Loopholes in Halal investment

In any investment, you will have risks and benefits too. Islamic finance does not prohibit risk-taking investments but discourages hypothetical investments. Here we have mentioned the risk associated with halal investment:

1. Lack of opportunity:Halal investment products are new to the finance and banking industries, so we get opportunities. But it is growing in all Islamic financing and budgeting products, and soon you will get ample opportunities.

2. Due conscientiousness:Gathering information for Halal investment is far greater than the traditional. The due rigour takes time and needs attention on details that not all investors do willingly.

3. Heterogeneity:Halal investment needs time and rational thinking. It means the portfolio will not grow as diverse and quick as traditional investments.

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islamiceconomicsproject · 1 year

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Profit and Loss Sharing Two Tier Mudarabah

Paper Title: Profit and Loss Sharing Partnership: The Case of the Two Tier Mudarabah in Islamic Banking Author: Amine Ben Amar and AbdelKader O. El Alaoui Publisher: Emerald International Journal of Islamic and Middle Eastern Finance and Management, Vol. 16 No. 1, 81-102. This paper mathematically analyzes the two-tier Mudarabah model in an exclusive Islamic financial environment and…

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#AbdelKader O. El Alaoui #Adverse Selection #Agency Conflict #Amine Ben Amar #Debt Based Modes of Financing #Distributive Justice #Equity Based Modes of Financing #Ideal Modes of Financing #Information Asymmetry #Islamic Banking #Islamic Finance #Moral Hazard #Mudarabah #Musharakah #Profit and Loss Sharing #Risk Sharing #Risk Sharing vs Risk Shifting #Shariah Based Modes #Two Tier Mudarabah

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dgpr-punjab-newsroom · 3 years

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With the compliments of, The Directorate General Public Relations,

Government of the Punjab, Lahore Ph: 99201390.

No.1835/QU/Mujahid

HANDOUT (A)

USMAN BUZDAR DISTRIBUTES SCHOLARSHIPS AMONG MINORITY STUDENTS

LAHORE, November 17:

Chief Minister Punjab Sardar Usman Buzdar distributed scholarship cheques among minority students at a ceremony at his office on Tuesday. Provincial Minister for Minority Affairs and Human Rights Ijaz Alam, SACM Dr Firdous Ashiq Awan, Parliamentary Secretary for Human Rights and Minority Affairs Mahindar Pal Singh, MPAs Haroon Imran Gill and Peter Gill, secretaries of Minority Affairs and Information & Culture departments were also present.

The CM said the Punjab government is providing 100 per cent scholarships to students of minority communities from matric to Ph.D. in government institutions. Similarly, 2 per cent quota is also allocated in higher education institutions along with 5 per cent job quota, he added. On the other side, 50 million rupees are allocated for educational scholarship scheme for non-Muslim students and 2.5 crore rupees are given through PEEF while the remaining amount is provided through the concerned department as stipends. The CM further stated 50 per cent scholarship is earmarked for central Punjab, 35 per cent for southern Punjab and share of northern Punjab students is 15 per cent. Non-Muslim students are given scholarships ranging from Rs.15000 to 50 thousand from matric to higher studies.

The CM said 714 students, including 157 from Lahore, have been given scholarships on merit during the current financial year. This includes 32 students enrolled in professional educational institutions. The CM further said 50 crore rupees are being spent on the development of localities where non-Muslims are residing and another amount of 6 crore rupees is provided every year for the festivals of every minority community. The government is committed to providing equal opportunities for development and prosperity to the minority communities, he added.

Provincial Minister Ijaz Alam thanked the Punjab government for providing scholarships to students of minority communities adding that such students have brought laurels home in the education sector. The PTI government will continue to provide different facilities to the minority community students, he added.

** **

No.1836/QU/Umer

HANDOUT (A)

PUNJAB CABINET APPROVES MINIMUM SUPPORT PRICE OF SUGARCANE

LAHORE, November 17:

The provincial cabinet, which met under the chair of Chief Minister Punjab Sardar Usman Buzdar at his office on Tuesday, gave ex post facto approval to fix Rs. 200 per maund minimum support price of sugarcane along with the approval of transportation charges and sugarcane development cess. The meeting also decided to constitute a ministerial committee for the procurement of additional imported sugar. This committee will submit recommendations after a review of sugar stock. The meeting stressed the sugarcane growers will be given a full reward of their hard work during the crushing season and legal action will be initiated against those failing in timely payments.

The cabinet allowed the food department to enter into an agreement with PASSCO for the purchase of 63 thousand metric ton imported wheat. The participants expressed the satisfaction over the stabilization of prices of flour and sugar. It decided to secure implementation of 3 per cent job quota for the visually-impaired and approved a further five-year age relaxation for employment purposes. Now, the visually-impaired candidates will enjoy up to 15-year relaxation.

The meeting also approved the draft law of the 17-member Punjab Tourism, Culture and Heritage Authority with the CM and tourism minister as its Chairman and vice-chairman, respectively. The authority will work for the promotion of tourism and culture.

The meeting decided in principle to lift the ban on the lease of coal mines and also gave in-principle approval to lift the ban on renewal of the mines leases. The meeting decided to constitute a ministerial committee to dispose of the aeroplane (AP-BX/400-A, RK-80) grounded since 2004. This committee will submit its report after reviewing different options including auction. The meeting approved setting up rescue 1122 station in Khairpur Tamewali tehsil of Bahawalpur while the release of NOC for transfer of 6-Kanal land of Tehsil Council Jhang for setting up another rescue 1122 station was also approved.

The appointment of the registrar for the University of Jhang was approved along with the decision to hand over assets of Inland Water Transport Company to the Tourism Department. The meeting decided to resolve the matter of acquisition of land for Greater Thal Canal Project Chaubara Branch phase-II and it was further decided to process the case with Asian Development Bank. The 448 miles long Greater Thal Canal will irrigate two lakh and 90 thousand acres of land.

The meeting decided to relax rules for the appointment of senior registrars posted in hepatology, liver hepatology and medical ICU from 2019. Meanwhile, approval was granted to issue notification of the medical teaching institute under Section 3(1) of the Medical Teaching Institute Act. It was also decided to implement the MTI Act at Khawaja Safdar Medical College Sialkot. The participants approved to bring King Edward Medical College under King Edward Medical University.

The cabinet also approved a south Punjab reallocation allowance for the officers posted in south Punjab secretariat. 655 posts have been created for 17 departments in this paperless secretariat. 237 posts will be in grade 17 and above. 154 IT officials will also be posted beside the miscellaneous staff of 264 officials. The meeting approved further extension in the registration date of online registration with the charity commission.

The cabinet standing committee for finance and development will take stock of matters relating to the release of a letter of comfort or bridge financing for land requisition for Ravi Urban Development Authority. The cabinet approved to present annual reports of Punjab Information Commission to Punjab Assembly and appointment of regular president/CEO of Punjab Cooperative Bank Limited. It also approved the appointment of Dr Arfa Iqbal as CEO Punjab Board of Investment and Trade. The cabinet standing committee for legislation will submit its report to the cabinet regarding permanent appointments under Rule 17. The next cabinet meeting will be held in DG Khan.

Provincial ministers, advisors, special assistants, CS and others attended the meeting.

*****

No.1838/QU/Umer

HANDOUT (A)

CM ATTENDS MULTILINGUAL ALL PAKISTAN MEHFIL-E-NA'AT

LAHORE, November 17:

Chief Minister Punjab Sardar Usman Buzdar, ministers, parliamentarians and senior officials attended the na'atia mushaira held under the aegis of information and culture department at CM Office on Tuesday.

Various poets paid their poetic tributes to Holy Prophet Muhammad (PBUH) in different languages. Shujaat Hashmi presented Kalam-e-Iqbal and its English and French translations were also presented. Zaheer Abbas Bilali and his associates presented Qaseeda Burda Shareef while the na'atia mushaira was chaired by Dr Munawar Hashmi. Amjad Islam Amjad, Hameeda Shaheen, Abbas Tabish, Ayub Khawar, Zahid Fakhri, Bismal Sabri, Farhat Abbas Shah, Khuda Baksh, Nasir Ali Syed, Aseer Mengal, Noor Rizvi and Iqbal Sokhri paid their tributes. The CM welcomed the holding of the event.

*****

No.1839/QU/Umer

HANDOUT (A)

CM TAKES NOTICE OF RAPE-CUM-MURDER OF A GIRL CHILD

LAHORE, November 17:

Chief Minister Punjab Sardar Usman Buzdar has sought a report from RPO Sargodha about rape-cum-murder of a 9-year girl in Sargodha and directed to early arrest the criminals. He also extended sympathies to the bereaved family and assured them to provide justice.

****

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expatimes · 3 years

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Poll hopeful vows defense of Sharia

KUWAIT CITY, Nov 14: Fifth Constituency candidate and former MP Majed Musaed Al-Mutairi signed a pledge to defend and support the Islamic Sharia and deep-rooted Kuwaiti traditions.

The pledge includes preventing manipulation of the Islamic Studies curricula in various educational stages. He also promised to support efforts to stop immoral activities like dance parties and the establishment of swimming pools for men and women in hotels.

He will push for the ratification of a law criminalizing the acts of engaging in sodoku sciences like energy and nerve programming, in addition to posting advertisements about the relevant drugs and tools. He intends to support bills on enforcing the Islamic Sharia.

Former MP and Third Constituency candidate Yousef Al- Fadalah disclosed that he has no specific electoral agenda, disclosing he has had a vision and some of its items have been accomplished while others have yet to be completed.

He criticized the 2016 Parliament, as the bank deposits of several MPs swelled during its term. He stressed the need to stop corruption in the legislative authority and criticized the silence of some former MPs over the attitude of the government.

Former MP and Third Constituency candidate Saadoun Hammad emphasized the need to provide more support for Kuwaiti women. He argued that it is better and cheaper if the government grants houses to these women than the KD 70,000 housing loan. He said the average cost of a government house is about KD 40,000; while the loan amount is higher, yet it is not enough to buy a flat.

Third Constituency candidate Uqab Hammad Al-Otaibi decided to withdraw from the elections, because he is concerned about the safety of voters in view of the coronavirus crisis.

Moreover, Kuwait Anti-Corruption Authority (Nazaha) confirmed that it is following up information posted on social media regarding the elections. It urged citizens to report violations by visiting its headquarters in Hsamiya or through email incident_report@ nazaha.gov.kw. Nazaha added it is working hard to complete the establishment of a section for reviewing the declaration of assets and liabilities, which will be submitted by the ministers and MPs after the announcement of election results. Ministry of Information recently announced the opportunity for candidates from all constituencies to present their electoral programs to their constituencies for a period not exceeding three minutes, then broadcast them via the media platforms of the ministry in keeping with its usual previous parliamentary elections, reports Al-Qabas daily.

The ministry in a recent statement said the reception of candidates who wish to present their own visions to the voters of their constituencies will start next Saturday and last for 10 days. It added that this opportunity will be given free of charge to all candidates who wish to address the public through Kuwait TV and Radio and the Ministry’s social media platforms. In the same context, the Ministry stated that during the next few days, it will launch a wide advertising campaign aimed at urging citizens to actively participate in the upcoming National Assembly elections scheduled for the fifth of next month. It stated that this campaign comes as an affirmation of the ministry’s keenness to support the Kuwaiti democratic process, which is considered a pioneer in the region in terms of national responsibility, which the Ministry of Information bears one of its most important pillars.

It explained that the campaign will cover advertisements for external and internal roads, screens inside cooperative societies, fuel stations, public transport and others aimed at covering a large number of areas, streets and places that citizens visit continuously.

The ministry said it seeks through advertising campaign to deliver a targeted media message to invite voters to exercise their national role guaranteed by the Kuwaiti Constitution and to participate in selecting their representatives in the Parliament, a role that is no less important than what the deputy plays in the legislation, development and contribution to the renaissance of the country. The ministry indicated “it has prepared national flash drives to be broadcast on the local channels and distributed to private channels, as well as the various news and electronic sites, stressing the importance of participating in the upcoming parliamentary elections.”

The Ministry of Education continues its preparations for the parliamentary elections; starting with the allocation of 102 schools which will be used as polling centers during the elections on Dec 5, reports Al-Anba daily quoting informed sources from the educational sector. Sources revealed the ministry intends to suspend work on Dec 6 – a day after elections – in schools designated as polling centers only. Sources explained this will give the ministry enough time to prepare the school buildings and clean them before the resumption of work.

Sources said the administrative staff in the concerned schools will not report for work on Dec 6; provided they guarantee that online classes proceed as usual in coordination with the directors of schools. Sources added classes will not be suspended on Dec 6, especially since they are conducted online.

They called on everyone to strictly follow the instructions that the ministry will announce later. Sources affirmed that the ministry will hand over the schools to its justice counterpart at the end of official working hours on Dec 3. Sources said the schools will be prepared and fully cleaned on Dec 4 in time for the elections the next day.

By Saeed Mahmoud Saleh Arab Times Staff and Agencies

The post Poll hopeful vows defense of Sharia appeared first on ARAB TIMES - KUWAIT NEWS.

#kuwait Read full article: https://expatimes.com/?p=14004&feed_id=16927

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lodelss · 4 years

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Reparations – Has the Time Finally Come?

During a lull one afternoon when I was a high school student selling Black Panther Party newspapers on the streets of downtown Washington, D.C., in 1971, I sat down on the curb and opened the tabloid to the 10-point program, “What We Want; What We Believe.” The graphic assertion of “Point Number 3” particularly grabbed me:

“We believe that this racist government has robbed us and now we are demanding the overdue debt of forty acres and two mules … promised 100 years ago as restitution for slave labor and mass murder of Black people. We will accept the payment in currency which will be distributed to our many communities. The Germans are now aiding the Jews in Israel for the genocide of the Jewish people. The Germans murdered six million Jews. The American racist has taken part in the slaughter of over fifty million Black people. Therefore, we feel this is a modest demand that we make.”

The absence of justice continually flustered me because, even at that young age, I knew that Black people had been kidnapped and brought to this country to labor for free as slaves; stripped of our language, religion, and culture; raped and tortured; and then subjected to a Jim Crow-era of lynchings, police brutality, inferior education, substandard housing, and mediocre health care. I did not know then about the massacres in Rosewood, Florida, or Tulsa, Oklahoma; the merciless experimentations on defenseless Black women devoid of anesthesia that led to modern gynecology; or about the enormous profits from slavery made by corporations, insurance companies, the banking and investment industries, and academic institutions. But on a psychic level, I could feel in my bones the enslavement era’s inhumane cruelty to Black children — its destruction of kindred ties and its economic exploitation and cultural deprivation. There was an incessant gnawing in my soul for amends and redress. I was passionate about injustice, felt the idea of reparations to be reasonable and fair, and vowed to talk about the concept whenever and wherever I could. My analysis, however, had not crystallized beyond a check. But just to mouth the word “reparations” was a starting point to its validity. Thus talk about it I did, despite my views being often rejected, ridiculed, or otherwise summarily dismissed. Standing on the street corner that afternoon nearly five decades ago, little did I realize that I would one day be in the company of leading academics, economists, historians, attorneys, psychiatrists, politicians, and more — domestically and internationally — promoting the right to, and the need for, reparations.

Several members of the Black Panther party carry copies of the Black Panther newspaper

Credit: Associated Press

The Fight for Reparations Has a Long History

But that day would be far into the future. Despite my advocacy and that of many others during my high school, college, and law school years and beyond, the issue of reparations for descendants of Africans enslaved in the United States was not fashionable, but fringe, and definitely not part of the mainstream popular discourse. Indeed, one would be branded as a militant or a revolutionary (both of which I was), or just plain crazy (which I was not), or in today’s dubious governmental surveillance parlance, a “Black Identity Extremist.” Indeed, it is almost surreal being amidst all the buzz surrounding reparations today, from universities to talk show pundits and, interestingly, to 2020 Democratic candidates vying for the presidency. Despite or perhaps because of today’s surge in attention to this longstanding issue, I feel it critical that the populace understands that the demand for reparations in the U.S. for unpaid labor during the enslavement era and post-slavery discrimination is not novel or new. The claim did not drop from the sky with Ta’Nehisi Coates’ brilliant treatise, “The Case for Reparations,” in The Atlantic, or from Randall Robinson’s impassioned book, “The Debt: What America Owes to Blacks,” both of which galvanized the issue in different decades and thrust it into national conversation.

Although there have been hills and valleys in national attention to the issue, there has been no substantial period of time when the call for redress was not passionately voiced. The first formal record of a petition for reparations in the United States was pursued and won by a formerly enslaved woman, Belinda Royall. Professor Ray Winbush’s book, “Belinda’s Petition,” describes a petition she presented to the Massachusetts General Assembly in 1783, requesting a pension from the proceeds of her enslaver’s estate — an estate partly the product of her own uncompensated labor. Belinda’s petition yielded a pension of 15 pounds and 12 shillings. Former U.S. Civil Rights Commissioner Mary Frances Berry illuminated the case of Callie House in her book, “My Face Is Black Is True.” Callie, along with Rev. Isaiah Dickerson, headed the first mass reparations movement in the United States, founded in 1898. The National Ex-Slave Mutual Relief Bounty and Pension Association had 600,000 dues-paying members who sought to obtain compensation for slavery from federal agencies. During the 1920s, Marcus Garvey and the Universal Negro Improvement Association galvanized hundreds of thousands of Black people seeking repatriation with reparation, proclaiming, “Hand back to us our own civilisation. Hand back to us that which you have robbed and exploited of us … for the last 500 years.” During the 1950s and 1960s, New York’s Queen Mother Audley Moore was perhaps the best-known advocate for reparations. As president of the Universal Association of Ethiopian Women, she presented a petition against genocide and for self-determination, land, and reparations to the United Nations in both 1957 and 1959. She was active in every major reparations movement until her death in 1996.

Queen Mother Audley Moore

Credit: Associated Press

In his 1963 book, “Why We Can’t Wait,” Dr. Martin Luther King proposed a “Bill of Rights for the Disadvantaged,” which emphasized redress for both the historical victimization and exploitation of Blacks as well as their present-day degradation. “The ancient common law has always provided a remedy for the appropriation of labor on one human being by another,” he wrote. “This law should be made to apply for the American Negroes.” After the Black Panther Party’s stance in 1966, the Republic of New Afrika proclaimed in its 1968 “Declaration of Independence:

“We claim no rights from the United States of America other than those rights belonging to people anywhere in the world, and these include the right to damages, reparations, due us from the grievous injuries sustained by ourselves and our ancestors by reason of United States’ lawlessness.”

In April 1969, the “Black Manifesto” was adopted at a National Black Economic Development Conference. The manifesto, presented by civil rights activist James Forman, included a demand that white churches and synagogues pay $500 million in reparations to Blacks in the U.S. The amount was based on a calculation of $15 for each of the estimated 20 to 30 million African Americans residing in the U.S. He touted it as only the beginning of the amount owed. The following month, Forman interrupted Sunday service at Riverside Church in New York to announce the reparations demand from the “Black Manifesto.” Notably, several religious institutions did respond with financial donations. In 1972, the National Black Political Assembly Convention meeting in Gary, Indiana, adopted “The Anti-Depression Program,” an act authorizing the payment of a sum of money in reparations for slavery as well as the creation of a negotiating commission to determine kind, dates, and other details of paying reparations. Consistently, the Nation of Islam’s publications — such as Muhammad Speaks and, later, The Final Call — have demanded that the United States exempt Black people “from all taxation as long as we are deprived of equal justice.”

The Modern-Day Reparations Movement

But it was the end of the 20th century that brought broad national attention to the call for reparations for people of African descent in the United States with the founding of the National Coalition of Blacks for Reparations in America (NCOBRA). I was proud to be a founding member of NCOBRA at the historic gathering on Sept. 26, 1987, which brought together diverse groups under one umbrella, from the Republic of New Afrika to the National Conference of Black Lawyers. For its first decade in existence, I served as chair of NCOBRA’s legislative commission. Since the creation of NCOBRA, the demand for reparations in the United States substantially leaped forward, generating what I’ve dubbed “The Modern-Day Reparations Movement.” Inspired by and organized on the heels of the passage of the 1988 Civil Liberties Act, which granted reparations to Japanese-Americans for their unjust incarceration during World War II, NCOBRA reinvigorated the demand for reparations for African Americans and broadened the concept through public education, accompanied by legislative and litigation-based initiatives. Also encouraged by the 1988 Civil Liberties Act, Rep. John Conyers introduced a bill in 1989 to “establish a commission to examine the institution of slavery and subsequent racial and economic discrimination against African Americans and the impact of these forces on Black people today.” This commission would be charged with making recommendations to the Congress on appropriate remedies. The bill’s number “H.R. 40” was in remembrance of the unfulfilled 19th-century campaign promise to give freed Blacks 40 acres and a mule. Conyers’ “Commission to Study Reparation Proposals for African Americans Act” provided the cover and vehicle to have a public policy discussion on the issue of reparations in Congress.

Rep. John Conyers

Credit: Associated Press

The 1988 Civil Liberties Act authorized the payment of $20,000 to each Japanese-American detention-camp survivor, a trust fund to be used to educate Americans about the suffering of the Japanese-Americans, a formal apology from the U.S. government, and a pardon for all those convicted of resisting detention camp incarceration. It is a sad commentary that the U.S. government has not taken formal responsibility for its role in the enslavement or post-slavery apartheid segregation of millions of Blacks. It has never attempted reparations to African Americans for the extortion of labor for many generations, deprivation of their freedom and human rights, and terrorism against them throughout the centuries. The U.S. Senate and House did pass symbolic resolutions apologizing for slavery and segregation. However, the 2009 bill passed by the Senate contained a disclaimer that those seeking reparations or cash compensation could not use the apology to support a legal claim against the U.S. Since the introduction of H.R. 40, several state legislatures and scores of city councils across the country have passed reparations-type legislation or resolutions endorsing H.R. 40. In 1990, the Louisiana House of Representatives passed a resolution in support of reparations. In 1991, legislation was introduced in the Massachusetts Senate providing for the payment of reparations for slavery, the slave trade, and individual discrimination against the people of African descent born or residing in the commonwealth of Massachusetts. In 1994, the Florida Legislature paid $150,000 to each of the 11 survivors of the 1923 Rosewood Race Massacre and created a scholarship fund for students of color. In 2001, the California State Assembly passed a resolution in support of reparations. After a four-year investigation, the Tulsa Race Riot Reconciliation Act was enacted in 2001. Oklahoma legislators settled on a scholarship fund and memorial to commemorate the June 1921 massacre that left as many as 300 Black people dead and 40 square blocks of exclusively Black businesses, homes, and schools obliterated. That same year, a bill was introduced in the New York State Assembly to create a “Commission to Quantify the Debt Owed to African Americans.” Bills are also pending within several other state legislatures, but the reparations movement isn’t just targeting state houses. City councils in the states of Arkansas, California, Georgia, Illinois, Maryland, Michigan, Mississippi, Missouri, New Jersey, Ohio, Pennsylvania, Texas, Vermont, Virginia, and the District of Columbia have all passed resolutions in support of H.R. 40. Reparations advocates have also challenged corporations who benefited from the profits made from trafficking in human beings during the enslavement era. Countless companies and industries benefited and were enriched from the profits made as a result of chattel slavery. There are companies that sold life insurance policies on the lives of enslaved persons, such as Aetna, New York Life, and AIG. Financial gains were accrued by the predecessor banks of financial giants like J.P. Morgan Chase and Bank of America. Others with documented ties to slavery included railroads like Norfolk Southern, CSX, Union Pacific, and Canadian National. Newspaper publishers that assisted in the capture of runaway persons include Knight Rider, Tribune, E.W. Scripps, and Gannett. The financial backers of many of the country’s top universities were wealthy slave owners, and it has been disclosed that the reason Georgetown University stands today is because the Jesuits who ran the college used profits from the sale of Black people to continue its operation. Survivors of torture by Chicago police received an unprecedented compensatory package based on a reparations ordinance passed by the Chicago City Council in 2015. Numerous civil and human rights organizations, religious groups, professional organizations, civic groups, sororities, fraternities, and labor unions have also officially endorsed the call for reparations. In 2016, the Movement for Black Lives Policy Table released its platform, which prominently featured the issue of reparations. The role that governments, corporations, industries, religious institutions, educational institutions, private estates, and other entities played in supporting the institution of slavery and its vestiges are roles that can no longer be ignored, dismissed outright, or swept under the rug. The time is now ripe that their involvement be recognized, examined, discussed, and redressed.

The Demand Deserves Serious Consideration

I am part of the inaugural cohort of commissioners on the National African American Reparations Commission (NAARC), convened by the Institute of the Black World 21st Century in 2016. The commission’s preamble asserts:

“No amount of material resources or monetary compensation can ever be sufficient restitution for the spiritual, mental, cultural and physical damages inflicted on Africans by centuries of the MAAFA, the holocaust of enslavement and the institution of chattel slavery.”

Recognizing these as “crimes against humanity,” as acknowledged by the 2001 Durban Declaration and Program of Action of the World Conference Against Racism in South Africa, the preamble goes on to assert that “the devastating damages of enslavement and systems of apartheid and de facto segregation spanned generations to negatively affect the collective well-being of Africans in America to this very moment.” NAARC has advanced a comprehensive, yet preliminary, reparations program to guide reparatory justice demands by people of African descent in the United States. Finally, although my primary focus has been on obtaining reparations for African descendants in the United States, it is critical to recognize that our quest is part of the international movement for reparations as well. As such, I have worked closely with supporters of reparations throughout the world, recognizing that the success of the movement for reparations for diasporic Africans anywhere advances the movement for reparations by Africans and African descendants everywhere. I am thrilled that my quest to have reparations seen as a legitimate concept for African Americans, begun nearly 50 years ago, is becoming a reality. The issue has become more precise, less rhetorical, and has entered the mainstream. And while cash payments remain an important and necessary component of any claim for damages, it is crystal clear today that a reparations settlement can be fashioned in as many ways as necessary to equitably address the countless manifestations of injury sustained from chattel slavery and its continuing vestiges. Some forms of redress may include land, economic development, or scholarships. Other amends may embrace community development, repatriation resources, or truthful textbooks. Still, other areas of reparatory justice may encompass the erection of monuments and museums, pardons for impacted prisoners from the COINTELPRO-era, and repairing the harms from the War on Drugs. Fifty years after I first entered the reparations movement, I’m optimistic. It’s hard not to be when H.R. 40 has been updated to include not just a mere study of proposals but also their development. It’s also hard not to be optimistic when a Senate companion bill to H.R. 40 has been introduced and even more astonishing when some Democratic candidates for the 2020 presidential race are saying they will sign the legislation if elected president. Despite a resurfacing of white supremacy in the U.S., I can see the light at the end of the tunnel. I am buoyed by the reemergence of the spirits of Belinda, Callie House, and Queen Mother Moore as well as the resilience of “Reparations Ray” Jenkins, who kept the fire alive in Rep. Conyers to introduce H.R. 40 year after year. And I am inspired by the words of the great anti-slavery orator Frederick Douglass, who poignantly instructed that “power concedes nothing without a demand.” The demand has been made and the time to seriously consider reparations has finally come.

READ THE FULL REPARATIONS SERIES

Nkechi Taifa is founder and president of The Taifa Group, LLC. An accomplished human rights attorney, she is a justice system reform strategist, advocate, and scholar.

Published May 27, 2020 at 12:05AM via ACLU https://ift.tt/3grc5uE

#IFTTT #Blogger

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citizen0ne · 6 years

Text

Yakuza White Dragon Society battles New World Order Khazarian Mafia as U.S. troops deploy worldwide with 10,000 sealed indictments to help take them down.

“10,000 Sealed Indictments” – Fulford Report – 12.18.17

By Benjamin Fulford, official spokesman for White Dragon Society (Yakuza)

U.S. troops deploy worldwide with 10,000 sealed indictments to take down the centuries old secret Khazarian mafia

U.S. President Donald Trump spent the weekend at Camp David with his top generals to map out the exact strategy for decapitating the Khazarian mafia worldwide, say Pentagon sources. “The Atlanta airport was shut down while the Department of Defense refused to disclose the locations of 44,000 U.S. troops who may be involved in terminating the cabal worldwide,” a senior Pentagon source said. There are now close to 10,000 sealed indictments as more and more of the Khazarian criminals give up evidence on their colleagues, the sources say.

There are also many extra-judicial killings going on. “The liberal sanctuary city mayor of San Francisco, Edwin Lee, dropped dead after an illegal alien was found not guilty in the murder of Kate Steinle even after his confession,” one source notes. “Lee’s death is a message to the Democrats and sanctuary city mayors like Rahm Emmanuel of Chicago and Bill De Blasio of New York City,” the source warns.

The Khazarian mob is also killing off lots of people. In Japan, two former executives of Toshiba, Atsutoshi Nishida and Taizo Nishimura, suddenly died in the past two months because they were about to provide evidence about the March 11, 2011 Fukushima tsunami and nuclear terror attack against Japan, according to sources close to the royal family.

This attack was carried out by henchmen of the Rockefeller family, whose members include Hillary and Bill Clinton, the sources say. The Rockellers, in turn, were taking orders from the fascist P2 Freemason lodge, they say. The Rockefeller family, by the way, has elected Mel Rockefeller, the son of Nelson Rockefeller, as the new family head, these sources added.

In Canada, Barry Sherman, owner of the Canadian pharmaceutical giant Apotex, was found hanging dead alongside his wife Honey by the family’s indoor pool. According to CIA sources, Sherman was killed to cover up an evidence trail leading to the Clinton Foundation and their crimes in Haiti. “We have a classified document involving the Clinton Foundation and a pharmaceutical company from Canada that was to supply generic drugs for the people of Haiti. The point is that they were going to supply inferior-quality generic medicine and pocket the difference in price,” the CIA source says.

In any case, no matter how many potential witnesses are bumped off, the situation has reached a point where the Khazarians will not be able to murder their way out.

The December 12th Senatorial election in Alabama, for example, was a sting operation against the Khazarians, Pentagon sources say. “Senator Roy Moore was allowed to have his election stolen in Alabama so Trump could collect voting data to take down the Soros organization, the Democrats, and the cabal for vote fraud,” the sources say. “Three poll workers have been arrested already,” they note.

Speaker of the House Paul Ryan is next to join a growing list of politicians who are resigning in the ongoing purge of the House and Senate, the sources add. Senator John “Daesh” McCain is also apparently wanting to leave this world before his many crimes are made public.

http://fox6now.com/2017/12/15/john-mccain-described-as-increasingly-frail-senate-sources-say/

Even the brainwashed propaganda media is beginning to realize that something is going on when they see Hillary Clinton’s “surgical boot” (hiding a GPS ankle bracelet) staying on long after it should have been removed if the official excuse of a broken toe were true. No doubt some lame excuse will be given and the still-brainwashed segment of the population will accept it.

http://www.dailymail.co.uk/news/article-5178037/Clinton-wears-surgical-boot-MONTHS-breaking-toe.html

The people who still believe the cabal’s story line are like the people in the joke about a man who was told his wife was cheating on him. In the joke, he hires a detective to confirm his wife’s innocence. The detective comes back and says, “She met with another man in the street and they entered a hotel together.” The husband asks, “Did you see them enter a room together?” The detective says, “Yes.” “Did you see what went on inside the room?” the husband asks. “Yes, I peeked through the keyhole and saw them on the bed together,” the detective answers. “Were they covered with a blanket?” the husband asks. The detective says, “Yes” to the man. He asks, “Did you see under the blanket?” and the detective says, “No.” “In that case you cannot prove she was cheating,” the husband says.

The husband does not want to face reality because it would upset his entire worldview, and in the same way, the brainwashed people will cling to the lamest excuses to avoid reality. Similarly, if the Clinton people explain the cast is still on because of “complications,” people in denial will go with this story rather than accept that she has been arrested.

Nonetheless, we are reaching the point where even these people will be forced to face reality. The entire FBI and Justice Department network that tried to protect Hillary Clinton from prosecution is also being systematically exposed and dismantled. The link here provides a good visual summary:

http://rense.com/general96/whoswho.html

Now even the corporate media is being forced to accept that the so-called “Islamic State” was a CIA creation. This is coming out now because the November 18th U.S. military raid on the CIA has shut down Operation Mockingbird and the corporate media is being forced to report the truth.

http://www.zerohedge.com/news/2017-12-15/weapons-went-cia-isis-less-two-months-new-study-reveals

A clear sign of how unusual the times we are living in have become is that former U.S. Corporation President Barack Obama is seeking and apparently getting political asylum in England.

https://www.theguardian.com/uk-news/2017/dec/17/prince-harry-interviews-barack-obama-today-programme-guest-slot

What this shows, together with the fact that Donald Trump is not welcome in the UK, is that the Anglo-Saxon world is split between bloodline-controlled England and the anti-bloodline Gnostic Illuminati-ruled Republic of the United States of America.

This situation is likely to come to a head of sorts in January as an informal Anglo-Chinese alliance tries to bankrupt the U.S. internationally, based on its cumulative trade deficit and its inability to pay for the goods it imports with real money.

The U.S. will respond with threats of war. This will appear in the news in the form of U.S. sabre-rattling against North Korea, as it yet again wields the all-out nuclear war card in an attempt to extort more money. The Chinese are preparing to call the U.S. bluff this time, as can be seen by its government warning its people to prepare for nuclear war as it conducts military drills near Taiwan and North Korea.

http://www.scmp.com/news/china/diplomacy-defence/article/2124613/north-korea-time-bomb-government-advisers-urge-china

https://sputniknews.com/asia/201712131059976881-beijing-bombers-jets-encircle-taiwan/

https://www.rt.com/news/413269-china-navy-drills-north-korea/

The Chinese and British want the creation of a world government in order to ensure a peaceful and law-based planet, Asian secret society sources say. In the absence of some sort of compromise with the U.S. military government, there will be financial chaos even if war is avoided.

The current financial system is dysfunctional and only serves as a way to funnel privately owned central bank funny money to the super-rich via the stock market. This means of distributing money has pushed financial markets away from reality, and reality always will prevail, no matter how hard you try to avoid it. The Boston Consulting Group surveyed 250 top institutional investors who together manage over $500 billion in funds and found them to be the most pessimistic they have been since the Lehman shock of 2008.

https://www.bcg.com/publications/2017/survey-increasingly-bearish-investors-seek-long-term-value-creation.aspx

Hopefully, a new transparently and meritocratically run financial system will be launched, but we may need to go through the chaotic collapse of the old system before this is possible. We will find out in the new year.

On a final and personal note, Abraham Cooper of the Simon Wiesenthal Center will be speaking at the Foreign Correspondents Club of Japan on December 20th. Cooper had one of my books banned for being “anti-Semitic.” When I asked him what in my book was “anti-Semitic,” he said that I wrote that U.S. President George Bush Jr. was responsible for the deaths of many civilians in Iraq. Bush is supposed to be an evangelical Christian, and the information on the deaths of civilians in Iraq came from the medical journal Lancet. So here we have a supposed Jew banning a book written by a person with Jewish ancestry that is denouncing genocide by a non-Jew because it is “anti-Semitic.” How hypocritical can you get? Poor Mr. Weisenthal must be spinning in his grave.

According to officials at Tokuma Shoten Publishing, the Weisenthal Center paid bribes to editors to place misleading newspaper ads for my book. This then led to a complete ban of all advertising for all of my books in newspapers and other ad venues, no matter what their content. This is typical of what they do to writers worldwide and is a part of their control grid in Japan and elsewhere. In the U.S., the Department of Homeland Security froze the bank accounts of entire publishing companies to prevent them from publishing my books in English.

Cooper and his Jewish mafia buddies also pay rent-a-mob right-wingers to do things like attack ethnic Korean shopping districts in order to keep South Korea and Japan fighting each other, according to members of these groups.

The man is a criminal and belongs in jail. If Cooper is arrested, he will sing like a canary about the entire Khazarian mafia control grid in Japan and elsewhere. He will also explain exactly how the Khazarian mafia runs North Korea. I would be very happy if some MP’s showed up at the event and arrested him. Take him to Guantanamo and make him sing.

The Dragon groups we do know to be real include:

the White Dragon which has an ancient Asian counter-part

the Black Dragon (Greater East Asian Co-prosperity sphere etc.)

the Dragon family (Merovingian royalty)

the Green Dragon which has roots in Iran (Persia) and central Asia

the Red Dragon may be the Nazis new name for themselves because the Odessa group (post-war Nazis) is definitely on the war path.

(Benjamin Fulford is a Canadian national who has lived and worked in Japan for over 20-years experience as a professional writer and journalist. He has sold over 500,000 non-fiction books written in Japanese. He’s produced a comprehensive catalogue of scoops in field ranging from business to Yakuza gangsters to high-finance to government corruption. Now focused on exposing U.S. manipulation of Japanese politics, media and education through a combination of bribes, murder, brainwashing etc. My goal is to counter U.S. propaganda and expose the Japanese people to the truth so that they may free themselves from the colonial yoke and use their $5 trillion in overseas holdings to end world poverty and save the environment. Native or near native, spoken and written: Japanese, French, Spanish and English. Conversational, reading ability in Mandarin, Portuguese and Italian. As for his experience: from 2005-present: He published 15 books written in Japanese with cumulative sales running at over 500,000 copies. Has a weekly 2-hour TV show and appear frequently on numerous other nationally broadcast shows. He has regular columns in a variety of best-selling Japanese magazines. From 1998-2005, Fulford worked as Asia-Pacific Bureau Chief for Forbes Magazine, he quit in profound disgust over extensive corporate censorship and mingling of advertising and editorial at the magazine. From 1997-1998: Fulford worked as the Tokyo correspondent for the South China Morning Post. From 1995-1997: Fulford worked as the staff writer for the Nikkei Weekly and the Nihon Keizai Shimbun Newspaper. From 1993-1995 he took a sabbatical in Canada and researched the link between evolutionary forces and modern world society. From 1989-1992 Fulford worked as Senior Tokyo correspondent for the International Financing Revue. There, he created and managed Japan Watch, a news and analysis service available on the Reuters and Telerate news-wires. Created Katana, a Japanese language news service available on the Nikkei Quick news-wire. Triggered several Finance Ministry investigations with articles that uncovered financial industry irregularities. From 1986-1989 he worked as correspondent for Knight-Ridder Financial News; covered a broad range of market related news. One particularly market moving story was used by Knight-Ridder in an advertising campaign. From 1982-1985 Part time jobs during student years included: work as an editor of Hitachi Review, a science and technology magazine; translation in the fields of business and finance and assorted television, radio and movie appearances. From 1978-1982: he spent time traveling and avoiding civilization. He spent 1-year studying with a witch doctor along the upper reaches of the Uquyali river in the Peruvian Amazon. Lived with former cannibals. He also traveled to other wilderness locations and lived off the land describing his experience as peaceful, beautiful. challenging and character building, zen.

Education: Sophia University, Tokyo Japan; the University of British Columbia, Vancouver, Canada. BA Asian studies, China area specialty.)

(If you have been following me for a long time, you will remember my post laying out who were “black hats” fighting for the New World Order and who were “white hats” fighting for the people...well this is the “white hat” White Dragon Society (Yakuza) faction I was talking about.

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