Marzunisham Omar: Waqf – an economic perspective Speech by Mr Marzunisham Omar, Assistant Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Forum on "Waqf: An Economic Perspective", Kuala Lumpur, 9 April 2018. * * * It is an honour to speak on waqf from an economic viewpoint. Waqf, or Islamic endowment, is a virtuous act which not only serves as a philanthropic tool but holds great potential for economic development. Allow me to share some thoughts on the relevance of waqf and three strategies to unlock its full potential to benefit our country. Revival of waqf is timely to unlock its full potential Waqf is part of Islam’s great and long history. It is a well-established concept, conceived during the time of the Prophet, peace be upon him. When Umar ibn al-Khattab acquired a piece of land, he asked the Prophet how best to use it. The Prophet advised him to make the land inalienable and to use it for the benefit of the unprivileged – the poor and those in need. With that, the land was established as waqf. Over the centuries, this tradition continued and waqf has made vast contributions to the development of Islamic civilisation. Notable examples include the waqf of Süleymaniye in Istanbul, which provided for the construction of schools and universities, and the waqfs of Murad II and of Bayezid II in Edirne that built and operated hospitals that provided free treatment.
While these are inspiring examples from the past, it is no question that waqf remains relevant today. It can play an important part in our quest to develop a more dynamic, progressive and inclusive economy. It can do so by tackling some of the major challenges facing society, such as inequality and improving access to quality education and health. We must not allow intergenerational inequity to widen and magnify. And waqf, as a vehicle for those in a more privileged position to voluntarily give back and reinvest in the society, can help promote social mobility and stem this vicious cycle of inequity. As a sustainable, intergenerational mechanism for social investments, waqf could effectively contribute towards a more equitable society. As stated in the Quran, wealth that has been bestowed by Allah should not merely circulate among the rich. The Prophet said: “Blessed is the wealth of a Muslim from which he gives to the poor, the orphans and the needy travellers.” In Islam, wealth is regarded as a means and not an end, and Islamic wealth management acknowledges responsibility towards the community and benefitting those in need. Strategies to strengthen the effectiveness of waqf It is, therefore, timely to revive waqf and to bring back its glory days. Let me put forward three strategies that we can explore to unlock waqf’s full potential as a platform for Islamic social finance. First, is to broaden waqf assets and their applications. Fundamental to this is the need to correct the perception of waqf.