OJK highlights Indonesia's potential in sharia economy

OJK highlights Indonesia's potential in sharia economy

Chairman of the Board of Commissioners of the Financial Services Authority (OJK), Wimboh Santoso. (ANTARA/HO-Finance Ministry/pri/sh)

We have a strong basis to develop the sharia economy.
Jakarta (ANTARA) - Indonesia has the potential to develop its sharia economy and become a global-hub of the Islamic economy, chairman of the board of commissioners of the Financial Services Authority (OJK), Wimboh Santoso, said.

Indonesia was ranked first in the global sharia financial market in 2019 with a score of 81.93, according to the Global Islamic Financial Report (GIFR).

This serves as one indicator of the nation’s potential, Santoso said during an online discussion here on Thursday.

"This achievement should foster the optimism to materialize our goal as the global hub of the sharia financial (market),” he remarked.

In addition, he said, the Global Muslim Travel Index (GMTI) in 2019 named Indonesia the best destination for halal tourism. Indonesia outranked 130 other destination countries on the index.

Indonesia has the largest Muslim population of 229 million people, who account for about 87 percent of its total population, with 3.96 million Islamic students and 25,938 Islamic boarding schools.

"We have a strong basis to develop the sharia economy. Various efforts have been made, among others, we provide sharia-based products," he added.

However, Indonesia would need to establish a comprehensive sharia ecosystem. "We have (the need for) a complete ecosystem that includes mosques, Islamic boarding schools, financial institutions, alms collectors, and sharia market places that must be created to make this sharia financial sector work optimally," Santoso pointed out.

So far, the total assets of the sharia banking sector, which comprises 14 sharia public banks, 20 sharia business units, and 162 sharia public financing banks, have reached Rp545.39 trillion.

However, Santoso admitted that the sharia economy has grown at a slower pace compared to the conventional economy.

"In terms of supply of institutions we are ready, even it (the supply) is higher than demand. But, the market share is still low," he said. (INE)

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