Islamic Finance

With zakat, Muslims have the power to change the world

| 05 November, 2018 | General
 Houssam Chahine
With zakat, Muslims have the power to change the world
Photo: A United Nations High Commission for Refugees official carries out an IRIS test on an Afghan refugee at UNHCR’s Voluntary Repatriation Centre in Peshawar, Pakistan, June 23, 2016. REUTERS/Faisal Mahmood
This article is brought to you by UNHCR, the UN Refugee Agency, as part of its sponsorship of Thomson Reuters' State of the Global Islamic Economy 2018/19 report. The digital copy of that report can be downloaded here

Today, UNHCR, the United Nations Refugee Agency, faces an unprecedented challenge. At a time when the world is struggling with refugee crises on an unprecedented scale, the agency, which for nearly 70 years has been assisting refugees throughout the world, regardless of the background of their plight, is itself struggling to overcome a funding crisis that threatens its capability to adequately help the world’s most vulnerable displaced communities.

Part of the problem may be one of perception: as a UN body, UNHCR is not always seen as a fundraising organisation in the same way as major international NGOs and charities. Rather, many people tend to believe that paying for UNHCR and its refugee protection mandate should be the responsibility of governments.

This is true to an extent: UNHCR receives 87% of its funding from governments, the bulk of this given voluntarily, and more than 10% comes from private donations. However due to the sheer number of refugee emergencies, this funding doesn’t cover the organization’s work in assisting refugees. In 2018, that shortfall amounted to US$4.5 billion. To put that in perspective, it’s the amount needed to help more than 2 million refugees through UNHCR’s cashassistance programme, a lifeline for refugees and IDPs in several countries such as Jordan, Lebanon, Iraq, Egypt, Somalia and Afghanistan.

If we are to help the most vulnerable refugee families, we need to close that shortfall through alternative sources of funding, including donations from the public and companies. The good news is that UNHCR has lately witnessed a noticeable increase in ‘democratized’ funding, with people and businesses of different capacities and sectors coming together to form a global movement to help not only refugees and IDPs, but host communities as well.

This is precisely where the Islamic world can come in. A world that has been, for centuries, demonstrating sustainable giving in the forms of Zakat, Sadaqah, and Waqf. The foreign aid contributions of Gulf States are already having a significant impact; but it is the billions donated by ordinary Muslims in alms and charity every year, that has the power to completely transform the global aid landscape. IDB’s research on Zakat in 2015 conservatively estimates between US$232 billion and US$560 billion circulating annually.

It is an unfortunate fact that many Muslim countries have been hit hard by a global refugee crisis forcing millions of people from their homes. After seven years of fighting, Syria is struggling with 6 million IDPs; its neighbors are tasked with looking after 5 million Syrians who have crossed the borders. In Africa, in the arid Sahel, conflicts have forced tens of thousands from their land. Afghanistan still struggles with the legacy of constant conflict for a generation, and in Bangladesh some 700,000 Rohingya Muslims have sought refuge from persecution in the Rakhine province of Myanmar. Altogether, there are 68.5 million forcibly displaced people in the world, a figure that includes 40 million IDPs, 25.4 million refugees and 3.1 million asylum seekers.

At UNHCR, we believe it is a shared responsibility for all of us to respond to the burgeoning humanitarian needs. We believe Zakat is a potential game changer in addressing challenges the Muslim communities face, and showing the world that Muslims are in solidarity with their refugee brothers and sisters, especially when this pressing matter transcends their boarders. The Quran is clear on who receives Zakat, listing eight categories of eligible recipients. Refugees fall under at least four of these categories: the poor, the needy, the debtors and the wayfarers.

Through its Zakat Programme, UNHCR is the first agency of its type to provide an efficient and trusted route for people to fulfil Zakat obligations. By implementing an innovative cash assistance programme, 100% of Zakat contributions go directly to the people most in need: refugees. Amid controversies over some charities and aspects of charitable giving, UNHCR provides complete peace of mind: our Zakat Programme is subject to rigorous governance and oversight, ensuring transparency throughout the whole process. The UNHCR Zakat Programme is fully Shariah-compliant; it is backed by fatwas from five respected scholars and institutions.

In providing a fast, discreet and safe way for people to donate their Zakat, through digital payments and bank transfers, UNHCR is bringing Zakat provision into the modern era, and indicating that Muslims have the capability to address some of the most serious issues challenging the Islamic world. We are extremely proud and thankful for this opportunity that we have been given by the global Muslim community, to be able to utilize much needed Zakat funding for the most vulnerable and eligible refugees families.

About the author: Houssam Chahine has more than 20 years of experience in partnership building, stakeholder relationship management and business development in both the not-for-profit and governmental sectors. Specialized in advocacy and fundraising campaigns for refugees, stakeholder engagement, strategic planning, and donor management, Houssam launched new business development and fundraising programs, in international and local institutions such as Greenpeace, Abu Dhabi Environment Agency, and UNHCR.

Since 2011, Houssam has been leading private sector partnerships for UNHCR in the MENA region. This includes overlooking the development of UNHCR’s Islamic Philanthropy strategy, largely realized through UNHCR’s global Zakat Initiative, and partnerships with Islamic financial institutions, in addition to family foundations in the region.

 

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