PUTRAJAYA, June 22, 2005 (IslamOnline.net & News Agencies) – The Organization of Islamic Conference (OIC) needs a master plan incorporating strong Islamic financial elements that can raise Muslims' standing in the highly-competitive international economic arena, Malaysian Premier Abdullah Badawi said Wednesday, June 22.

"Indeed, working together is not only desirable but necessary in this demanding and highly competitive world," Abdullah told the opening of a seminar on the formulation of the document, reported Bernama news agency.

He stressed that Muslim countries must "resist the impulse to go it alone" and instead work together in concert.

Abdullah, the current chair of the OIC, added that there is still much to do for the Islamic financial system to catch up and keep pace with the conventional banking system.

Islamic financial services range from basic investment accounts, equity funds, bonds and more recently Islamic hedge funds and swap equivalents, while more new products are in the pipeline.

The Islamic financial sector is estimated to be worth between 200-300 billion dollars and is growing at a double-digit pace annually.

Malaysia is leading a push for Muslim nations to focus on economic development, build trade links with each other, and develop their financial sectors.

Abdullah said timely and relevant measures to accelerate the development of Islamic finance globally would provide options to close the gaps and build bridges within the Muslim community.

"While the master plan charts a roadmap for the next decade of Islamic financial sector development, we must also remain ready to realign our strategies and action when faced with changing economic and financial conditions," he said.

"Above all else, we should not lose sight of our ultimate objective of achieving balanced and comprehensive economic development."

Abdullah said the plan would provide a guided and sequenced approach to allow Muslim countries to focus their energy and efforts towards achieving the vision.

He added that the formulation of the document must include short and medium-term goals to ensure that any initiative undertaken was consistent with the long-term objectives.

Implementing the master plan, he said, would require the combined efforts of all the stakeholders, especially the member countries of the Islamic Development Bank (IDB) themselves to ensure the desired outcomes were achieved.

The document will be inked by OIC economic and finance ministers during their meeting here on Thursday and Friday.

Abdullah commended the IDB, the financial arm of the OIC, and the Islamic Financial Services Board for taking the initiative to formulate the document.

Abdullah also announced that Malaysia's Bank Negara (central bank) will establish an endowment fund of RM200 million to support the role of the international community of Shari`ah scholars in the global development of Islamic finance.

The fund, he said, would be used to finance research and development in product innovation, scholarships, and organization of Shari`ah scholars annual dialogue and training programs.

Abdullah noted that Islamic financial system had gained global acceptance and provided a viable means for Muslims to save, invest and obtain financing in conformity with Shari`ah requirements.

However, he said Islamic finance should not be viewed as exclusively for Muslims and Muslim countries alone.

"To realize our vision of having a comprehensive and accepted Islamic financial industry at the global level, it is imperative to ensure that Islamic finance is integrated into the international financial system and markets.

"Where appropriate, we should work together with the international financial community and with regulators to strengthen the Islamic financial system and to increase its acceptance at the global level," he added.

In highlighting the advantages of Islamic finance, he said the system promoted profit sharing between providers of funds and entrepreneurs, thus contributing towards equitable economic development.

"In addition, through a well-established global Islamic financial system, rich Muslim countries can provide funds to poor Muslim nations more efficiently," he said.

In a related development, a three-day World Islamic Economic Forum (WIEF), formerly known as OIC Business Forum, would kick off on October 1.

The Asian Strategy and Leadership Institute (ASLI) chief executive officer, Michael Yeoh, said the forum would address key issues facing the Muslim societies ranging from business and economics to science and technology.

"The forum would also be used to link business operations of non-Muslims nations, especially those from Europe, with Muslims nations," he told a press conference Wednesday.

The forum is expected to provide a vital platform for positive and healthy interaction between government leaders, civil society and business communities for the benefit of Muslim communities worldwide.

It is expected to be attended by several heads of governments, including Abdullah, his predecessor Mahathir Mohamad, Pakistan Premier Shaukat Aziz, Indonesian President Susilo Bambang Yudhoyono, Senegal President Abdoulaye Wade and Bangladesh Prime Minister Begum Khaleda Zia.

More than 500 participants from 42 countries are also expected to show up.