Understanding Islamic Finance - Doha Academy of Tertiary Studies

Distinguishing Features of the Islamic Economic System 23According to conventional economics, livelihood is the fundamental problem of man andeconomic development is the ultimate goal of human life. According to Islamic economics,livelihood is necessary and indispensable but is not the true and the only purpose of humanlife; the life hereafter is the real factor to be taken care of. This way, Islam also caters forthe welfare of man in the Hereafter. Wealth in all its possible forms is created by Allah, itbelongs to Allah; He has delegated the right of property to man for use and He has the rightto demand that man subordinates his use of wealth to the commandments of Allah. “He itis who made you vicegerents in the earth” (6: 165) and “does the man think that he will bejust left to himself” (75: 36). Wealth has to be used in such a way that it ensures success inthis world and the world hereafter.The overall objective of Sharī´ah behind these injunctions is the happiness and well-beingof human beings in this world and the world hereafter. The concept of happiness fromthe Islamic perspective is different from the concept of pleasure – the major objective ofpositive economics. Accordingly, everything which guarantees well-being and fulfils thesupreme interests of mankind is included in the objectives of Sharī´ah. These objectiveshave been identified by jurists like Ghazāli, Shātbi and subsequently by Tahir ibne Ashoorby an inductive survey of the Holy Qur’ān and Sunnah. The objectives can be divided intoprimary and secondary objectives.Primary ObjectivesThe primary objectives that Sharī´ah tends to realize are the protection and preservation of:1. Religion.2. Life.3. Progeny – family unit.4. Property.5. Intellect.6. Honour.The protection of religion means achieving the purpose of worship of Allah (SWT). InIslam there is a comprehensive system of beliefs and Sharī´ah makes it the responsibility ofthe State to implement Sharī´ah requirements in respect of beliefs.The protection and preservation of human life refers to the sanctity of life as emphasizedin the Qur’ān and Sunnah. There is the law of Qisās to punish those who cause any harmto human life. This objective also refers to the provision of basic necessities to all humanbeings.The protection of progeny or the family unit relates to marriage and the family institution,whose purposes are: procreation, protection against lack of chastity and the proper upbringingof children, enabling them to become good human beings and Muslims and to bring peaceand tranquility to society. Means to realize this objective are the promotion of the marriagecontract, tenets relating to family life and the prohibition of adultery.The protection of wealth and property refers to the sanctity of the wealth of all membersof society, with an emphasis on valid (Halal) earning and discouragement of a concentrationof wealth leading to a vast gap between the poor and the rich and the inability of the formerto meet their basic needs of food, health and fundamental education. For this purpose, Islamprovides a comprehensive law governing Mu‘āmalāt or transactions among members of asociety.