Islamic Finance

Indonesia: President calls for reform of alms management

Indonesia: President calls for reform of alms management
Photo: Indonesia President Joko Widodo stands as he waits for the arrival of French President Francois Hollande at the presidential palace in Jakarta, Indonesia March 29, 2017. REUTERS/Beawiharta

Jakarta, Feb. 6 -- President Joko Widodo has called for reform of alms and endowment management as well as sharia-based financial industry to support poverty alleviation and economic inequality eradication program.

"In developing sharia-based financial industry, it must give the benefit to productive sectors, including efforts in povery alleviation to reduce inequality," the President said at the opening of the National Sharia Financial Committee plenary session here on Monday.

Jokowi said, the number of sharia-based micro finance institution and micro endowment bank, especially in boarding schools, should be increased in 2018 thus it could spread across Indonesia.

Therefore, he continued, it could support distribution of sharia financing in the country, both for consumption, working capital and investment.

"The data I have received showed that some 41.8 percent of sharia-based financing was used for consumption. While for working capital and investment has reached 34.3 percent and 23.2 percent respectively," he elaborated.

Jokowi said, Indonesia has a huge potential to develop sharia-based economy in various sectors including halal food, pharmaceutical industry, muslim garment industry, and sharia-based tourism sector.

In the tourism sector, Indonesia is ranked fourth in the number of tourist visits among the Organization of the Islamic Conference (OIC) member countries.

"Global expenditure in muslim tourism in 2016 has reached US$169 billion or 11.8 percent of the total global expenditure in tourism consumption," Jokowi said, adding the Indonesia has the potential to boost its halal tourism.

Meanwhile, Religious Affairs Minister Lukman Hakim Saifudin said, the government would issue a presidential decree on alms collection for civil servants.

Under the regulation, the government would offer a 2.5 percent voluntary cut on muslim civil servant's salary for alms.

Reported by Bayu Prasetyo

Published by HT Digital Content Services with permission from Antara News.

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