The Islamic economic model

Leader countries and International Cooperation
With Adam Smith theories, the main Western capitalistic paradigm was to focus on profit maximization, a formula that has recently been transformed into value creation for shareholders. In the modern era a new commercial model was developed: a corporate social responsibility in which companies’ managers should consider the interests of all members involved in the contract and not only shareholders’ benefits. Ethics, moral values ​​and religious beliefs play an important role into this kind of business. As some scholars have stated, citizens can ensure the sustainable enterprise growth for a stable and bearable values’ creation. Indeed, the Islamic economy do not agree with the typical capitalistic principles belonged to Adam Smith theories. The Islamic model introduced instead a corporate social responsibility where manager should considered the benefits for all company’s members.
In any case the implication of Western interests in this area is well known, so that is also necessary to consider the presence of capitalistic model banks into all these countries. Among this overview, one important point should be considered first. The Islamic financial system is still part of the Islamic commercial banking system. Could be wrong to undervalue this specific point because of the western 2008 crisis, when the financial structure was separated from the commercial assets. It was also for this reason that was possible to suggest the Islamic financial system as a model to get forward the actual crisis.
The idea to divide into two different fields the real economy and the finance have created into the Western capitalistic system a deficit between the real capitals printed and those invested. From the beginning of the new millennium the Islamic world should look forward, the reason is not only in relation with the 2008 crisis, but above all, because of a new model of the Islamic finance, which is bringing wealth in most of the Asian or Middle Eastern countries. The islamic banking system spread along this area could be possible according to the different historical and social background which belong to each country. The first example were born in Egypt, Kuwait and Dubai. Those of Kuwait and Emirate States still represent the main reference points into an international panorama. On these examples few years later were born the Faisal Islamic Bank of Egypt (1977), the Islamic Investment Company of the Gulf (1977), the Bahrain Islamic Bank (1979) and the Iran Islamic Bank (1979). Real estate sector was the main target for most of the investments supported by the Islamic Bank, especially the Kuwait Finance House, leader of the islamic banking model which led the urban area enlargement.
Looking to the south-east Asia, Malaysia represents the most efficient example. Malaysian economy indeed is the best example of a new hybrid economic model which mix some western and islamic characteristic together. Malaysian model is the typical model of double economic regime which show it as not only possible, but really efficient for both financial and commercial sector.
The Malaysian islamic model could boost during the decade 1991-2001 when this new model has imposed itself as innovative, bringing new basis to domestic economy development. Surprisingly, the islamic model could fit into a globalized economic system, mostly thanks to the financial deregulations which have allowed the creation of new financial products.
Internationally speaking, from 1976 the Islamic economy started to be coordinate by some international institutions such as the Islamic Development Bank, which counts 43 members and could be a perfect example to clarify Islamic banks’ cooperation. Mostly in relation with foreign trade and commerce in network with the most important nationals’ credit institutions: 71.1% of the investments granted by IBD were based on murabaha; leasing have contributed for the 10.7%; while loans with services bills’ commission for 10.3%; finally mudaraba is present with 0.19%.