The 8th AIFC: Potential and Innovation in Islamic Public Finance Management for Economic Development
SP – 50 /KLI/2024
Jakarta, October 3, 2024 – The Ministry of Finance (MoF) held the 8th Annual Islamic Finance Conference (AIFC) in a hybrid format from October 3 to 4, 2024, in Jakarta. This event serves as an important forum for stakeholders and policymakers as well as academics and practitioners from various sectors to discuss the on-going developments and the potential of Islamic public finance in supporting inclusive and sustainable economic development.
The 8th AIFC carries the theme of “Islamic Public Finance Role and Optimization: Exploring and Harnessing Potentials and Innovation in Islamic Public Finance Management for Economic Development.” This theme is highly relevant in facing the increasingly complex world economic conditions and dynamics, including recent rising global economic and financial uncertainties, geopolitical tensions, and fragmented global trade.
In his opening remarks, Vice Minister of Finance Republic of Indonesia Thomas A. M. Djiwandono emphasized that global economic dynamics demand new and innovative approaches for countries to manage their economies, including public finance management and fiscal policies. The Islamic economic paradigm can offer valuable insights and solutions to tackle these challenges.
"I strongly believe we can learn a lot about creating well-designed public finance from the perspective of Islamic public finance. This approach is based on the principles of Maqashid al- Shariah, which prioritize justice, equity, social welfare, and ethical governance. These principles guide how resources are mobilized, allocated, and used to achieve socio-economic development,".
Similarly, in the Guest Lecture session, Malaysia's Minister of Finance II, Amir Hamzah Azizan, revealed that the Ekonomi MADANI framework, which consists of six core values: Sustainability, Ihsan, Respect, Innovation, Prosperity, and Trust, has been the foundation of Malaysia's strong economic performance over the past 24 years. This framework aligns with Maqasid al-Shariah principle, formulated with a focus on serving the community and mapping a new direction for Malaysia's socio-economic landscape.
Globally, Islamic public finance has produced phenomenal innovations, particularly in the development of Islamic public finance instruments, such as the sustainability-linked sukuk development. Indonesia and Malaysia have been the pioneers in developing Islamic public finance instruments within their fiscal policies, which not only serve as a source of government budget funding, but also have a significant impact on inclusiveness, social welfare-enhancing, and sustainable governance. Through various initiatives, platforms, and product innovations, Indonesia and Malaysia have achieved significant milestones in Islamic public finance
instruments or products such as Green Sukuk, Sustainability Malaysian Government Investment Issues (MGII), and Cash Waqf Linked Sukuk (CWLS).
In the closing, Vice Minister Thomas invited participants to collectively develop Islamic finance in accordance with the current economic dynamics. “Adopting Islamic values that emphasize justice, ethics, and inclusivity can inspire the creation of a global economic and financial system that benefits not only the Muslim community but also the world at large.”
On the first day of the 8th AIFC, there are two panel sessions discussing on Islamic public finance. The “Islamic Public Finance and Fiscal Policy: Managing Revenue, Financing, and Spending from Maqashid al-Shariah Perspective to Create Economic Impact” session covers Islamic public finance and fiscal policy related to public spending (provision of public goods), Islamic taxation, and financing management.
The next session, “Showcase of Islamic Social Fund Development in Indonesia: Islamic Public Finance Revenue Management: Utilizing Islamic Social Finance for Productivity, Inclusivity, Sustainability, and Resilience”, discussing the strategic framework, product/innovation development, and recent progress, including challenges and opportunities for the government.
The event successfully gathered over 337 papers from national and international participants in the Call for Papers program. Twenty of the best papers presented in the parallel sessions, and ten selected papers will be published in leading journals. These papers represent progressive research and analysis and will be valuable references for policymakers and Islamic finance practitioners.
The 8th AIFC was supported by the Islamic Development Bank (IsDB), the National Committee for Islamic Economy and Finance (KNEKS), the Indonesian Association of Islamic Economists (IAEI), Universitas Indonesia (UI), and Bank Syariah Indonesia (BSI).
Narahubung Media:
Deni Surjantoro
Kepala Biro Komunikasi dan Layanan Informasi
Kementerian Keuangan
