With Islamophobic sentiments tainting the Islamic finance market, Muslim-owned businesses in Europe face the consequences.
The global Islamic finance market will likely experience a stable and potentially sustainable growth in 2022, according to S&P Global Ratings’ 2022 edition.
The finance industry that is in accordance with Islamic law, is expected to increase by 10 to 12% this year.
It is predicted to expand beyond its immediate progress, depending on the extent of growth in Islamic banking assets within GCC member states and whether sukuk (Islamic bonds) issuance performs well, according to a separate S&P global report.
The Islamic finance industry experienced a 17.3% expansion in 2019, reaching $2.2 trillion with a 10.6% growth in 2020 during the Covid-19 pandemic.
The total value of all Islamic financial assets globally stand at about $2.5 trillion.
In the global Islamic finance market, GCC countries heavily contribute to the statistics, primarily due to their highly concentrated Muslim population. The GCC’s global market share of Islamic banking has reached 25%.
Islamic banking holds a six percent share in global banking assets, as of 2022 estimates.
Islamic finance industry in Europe
In Europe, home to approximately 25.7 million Muslims according to Statista’s 2016 estimation of the Muslim population, the Islamic finance industry sees the most engagement in the United Kingdom, where the majority of Europe’s Islamic finance education institutions prevail.
The UK takes the mantle with regards to academia and professional qualifications centred around Islamic finance.
“[It] is the leading centre of Islamic finance education and training, with four professional institutions and nearly 70 universities and business schools offering Islamic finance courses and degrees,” reports state.
The UK issued its first sukuk valued at £200 million as early as 2014, making it the first non-Islamic country to issue Islamic bonds which in turn cemented the UK as the European centre for Islamic finance.
With around four million Muslims living in the UK, the fully Shariah-compliant retail bank, the Al-Rayan Bank (formerly known as Islamic Bank of Britain), provides an Islamic approach to banking since 2004.
The Shard, London’s 95 story landmark skyscraper, was 95% financed by Qatar and built purely through Shariah-compliant funds.
Whilst Al-Rayan proves to be flourishing within the UK’s fertile environment of Islamic finance, the bank is a target of Islamophobia.
Qatar’s Al-Rayan Bank has been ruthlessly targeted by British newspapers, most prominent of which is the The Times, by author Andrew Norfolk who exhibits a history of well-documented Islamophobic sentiments.
In June 2021, Qatar was accused by the author of funding “jihadists” in Syria. It was further criticised for its supposed funding of the Ummah Welfare Trust, whose alleged links to Gaza and Hamas has secured a position in the US’ infamous list of terrorist organisations/persons.
Islamophobia in France
The Islamic finance industry struggles to cope with the Islamophobic atmosphere in other parts of Europe, mainly France.
Islamophobia has been a staple within French parliament over recent years.
France has been accused of systematically targeting its Muslim population due a surge of marginalising policies driven by President Emmanuel Macron to address the supposed “separatism and Islamism”, a recent report by the British advocacy group, Cage, stated.
The report underlines Macron’s implementation of executive powers to create a “systematic obstruction” policy to target Muslim groups and entities in France over the span of the last four years. Some of these policies include anti-separatism law and the Imam charter, which was created in November 2021 and drafted by the state-backed French Council of the Muslim Faith. The charter forces religious leaders to “subordinate” themselves to ‘French Islam’, a concept manufactured by the government in hopes to assimilate Islam with republicanism.
The policies were initially geared towards addressing the reasons behind the departure of a number of French Muslims to fight in Syria and Iraq from specific areas in France. They then took on a more nationwide project role aimed at tackling “Islamism” and “community withdrawal” across the country.
Since, Paris has injected a series of infamous laws into the system in order to, the group reported, “isolate Muslim institutions and bestow the state with vast powers to monitor and close institutions, unilaterally dissolve organisations and seize money under the pretence of preserving Republican values and combatting Islamism and/or separatism.”
Cage further added that the policies were put in force to justify the shutting down of at least a dozen mosques, hundreds of Muslim-owned businesses and charities, and the seizure of millions of euros worth of assets due to their alleged promotion of “Islamism”.
Halal-run businesses face the consequences of systematic Islamophobia sponsored by government entities, with claims targeting their nature of work. For example, “Hundreds of child deaths each year due to consumption of ‘halal meat’”, was the title of the parliamentary question submitted by Franz Obermayr to the European Commission on the 24th of April 2012, where he argued that “according to media reports, it is generally assumed that hundreds of children die in France every year after consuming halal meat.”
In 2019, major French sports company, Decathlon, was pressured into halting its introduction of sportswear crafted for Muslim women which included a runner’s suit as well as head scarf, giving in to the harsh criticism from politicians and high-profile figures in the French government, reports stated.
Speaking to Doha News, Rayan Freschi, researcher at CAGE, said: “Since February 2018, the French State started a draconian Islamophobic policy which targets Muslim civil society. The policy can be described as a strategy of maximum pressure on Muslim civil society to make day to day work intolerably difficult, asphyxiating a community weakened by decades of systemic bigotry.”
“It is de facto a state-led Islamophobic persecution.”
He added that “no Muslim is spared from the clutches of the racist French system”, stating that, mosques [and] Islamic schools [as well as] businesses run by Muslims are being controlled and closed by the [French] state.
“We believe that most of the 24,877 establishments controlled and most of the 718 establishments closed are indeed businesses run by Muslims. 46 million euros have also been confiscated by the State.”
Through such targeted treatment of Muslim business, the French government essentially weakens the foundations of an “already impoverished community, forcing it to rely on the welfare state,” Freschi told Doha News.
He further states that this “fabricated Islamophobic environment, where a Muslim is forced to rely on the government, economically, suffocates a thriving community that could potentially have an impact on a political scale.”
Under the guise of secularism, countries like France curtail Muslim communities from accessing their rightful share of the Islamic finance industry.