The 1st World Conference on Riba took place in Kuala Lumpur on the 1st and 2nd of November at Putra World Trade Centre (PWTC) which is considered one of the most important convention and exhibition centres of the city jointly organised by Thinkers Trends Resources and the Faculty of Economics and Management Sciences of International Islamic University of Malaysia (IIUM).
Dr. Mahathir Mohamed, former Prime Minister of Malaysia opened the conference with an analysis of the world economic crisis of 2008 which he expressly termed 'the mother of all economic crises.' The conference was attended by several influential Muslims that consisted of intellectuals, academicians, politicians, bankers, leaders of Muslim communities as well as of Muslim organisations from around the world. Present amongst such were: His Royal Highness (HRH) Alhaji Dr. Yahaya Abu Bakar (CFR), the Etsu Nupe and Chairman, Niger State Council of Traditional Rulers, Nigeria; Prof. Umar Ibrahim Vadillo, the pioneer and leader of the Islamic Gold Dinar movement; Dr. Aziuddin, a former conventional as well as Islamic banker for 18 years altogether; the Director of IIUM; Dr. Zambry, Chief Minister of the State of Perak; delegates from the State of Kelantan which had recently launched the gold Dinar and silver Dirham as barter-currency in Kota Bahru; professors from several other international universities and colleges; students, and delegates of Muslim organisations. Important and influential media organisations of Malaysia were also present and most speakers had to give a press conference after their respective lectures.
PWTC has hosted similar conferences in the past years. For instance, in July 2007, The International Conference on Gold Dinar Economy had taken place there also opened by Tun Dr. Mahathir Mohamed.
In the introductory and welcome address, it was mentioned that the purpose of the conference was not only to initiate philosophical discourse against usury and public education on the subject at a mass, national level, but was solution-driven as well to conclude at a solution to protect Malaysias economy from the global economic crisis of 2008 that has created a domino effect on the rest of the world which Malaysia has yet to encounter, but very soon. Prof. Ahmad Kameel Mydin Meera, the Chairman of the conference, associate professor of Economics and management sciences at IIUM, predicted that that domino effect is most likely to hit Malaysia sometime in the middle of next year. Before the effects begin to weigh heavily on Malaysia, Malaysians should already have begun preparations to move away from the usury-based financial system acting to establish the Islamic economic model, known as muamalah.
Dr. Mahathir did not enter into the Islamic response to the global economic crisis, and it would not be appropriate to do so either at the very beginning of the event. Rather, he very succinctly highlighted the causes of the crisis; how both free-market capitalism and socialist government interventions in the market have failed to guard the economy from debt after debt. He touched briefly on sub-prime loans, securities and the speculative nature of modern trade. Speculation usually spirals the effects and the solution have always been to reschedule debt and borrow again. To point out the unproductive nature of currency trading he drew an excellent comparison between the total value of one days currency traded in the world market, which is worth 4 trillion US dollars, and the total value of Germanys production for a whole year, which is also worth 4 trillion dollars. While the former in one day transfers gargantuan amounts of wealth from one countrys private hands to the private hands of another country due to mere speculation, the latter in the course of a full year produces goods, employment, exports, imports, services, technology, etcetera. He drew conclusions which pointed towards the imperatives of the present day to turn to real trading and move away from speculative trading, which is in truth trading with numbers without any production, consumption, labour, and such.
Prof. Umar Ibrahim Vadillo had replaced Maulana Siraj Hendricks, the Mufti of Cape Town, who could not attend the conference due to a sudden illness. Prof. Vadillo is the pioneer of the Islamic Gold Dinar movement and a leading scholar of the Islamic economic model (muamalah), being the first Muslim to mint the Gold Dinar in 1992 under Islamic standards established by the second Caliph of Islam, Umar ibn al-Khattab in the last hundred years since the fall of the Osmanli Caliphate in Istanbul. Since the advent of the Ottoman Royal Bank, the gold Dinars and silver Dirhams had slowly disappeared and been replaced by the Turkish paper currency, following the economic model that had already been put in place in England, 1694 and in later in France by the protagonists of the Revolution in 1789. This model had given the central banks monopoly over the issuing of paper for gold. Prof. Vadillo who had reversed the process with the minting of the first gold and silver Islamic coins (for paper) after almost a hundred years, began his address with a straightforward outlining of the imperatives that should be adopted as solution by the Malaysian people in order to re-establish muamalah in the country. He translated the meaning of minting, distribution and use of the Dinar and Dirham to be freedom. It is not a step to be adopted as an opposition to Capitalism, which he quite humorously called a phantom that cannot be fought, nor is it to prepare for an economic disaster that is soon to hit Malaysia, but simply to follow the Divine commands of Islam that have permitted trade and forbidden usury.
The minting, distribution and use of gold and silver as currency is the first and most important step that would allow for other steps to follow in establishing Islamic trade and turning away from usury. These other expansive and supportive yet indispensable steps would be: (1) caravans, (2) free markets, (3) guilds and (4) the Islamic financial contracts of Qirad (interest-free business loans) and Shirkat (partnerships). Prof. Vadillo spoke assertively that the Islamic Banks operate on the exact same foundations of conventional banks, just that the terms have in this case been Islamised or arabicised and that they do not follow the Islamic model of muamalah. Dr. Aziuddin, who had been a conventional banker for fourteen years and then had switched to become an Islamic banker for another four years and had recently turned away from both, on the second day of the conference, gave his own credible arguments against the Islamic banks in support and expansion of Prof. Vadillos lecture; credible because he had been a banker himself. He also spoke on the socio-political implications of Riba. No scholarly refutation was produced in the two days against Prof. Vadillos and Dr. Aziuddins statement that Islamic Banks 'are double haram (prohibited),' because they argued that the Islamic banks have taken what is prohibited in Islam and made it permitted. Some amateur disagreements were made in the question-answer sessions of the whole conference but no scholarly refutation on the matter.
The organisers of the conference after having received news that Maulana Imran Nazar Hosein from Trinidad and Tobago, scheduled to be the second speaker of the first day, could not attend the event, found him rather indispensable and resorted to projecting his lecture live from his home in Trinidad. Maulana Hosein dealt with the prohibition of Riba in the Quran and Sunnah and elaborated on the chronological sequence of the prohibition in the Quran. His lecture had the usual charismatic excellence. He had been trained in the traditional Islamic sciences when he was young and later in international relations and monetary economics at the doctoral level and he has many years of vast experience in lecturing on such subjects. His critique on modern monetary economics was readily accepted by those present and he had probably the most questions from the audience. It is noteworthy here to mention that Maulana Hoseins book entitled, The Prohibition of Riba in the Quran and Sunnah, was presented free to everyone who attended the conference, and his lecture could be described as a terse summary of his own book. He also took the subject of Riba to dimensions of Islamic eschatology, or the study of end of times. He warned of a financial Guantanamo that is coming tomorrow when 'nothing will be of value except for a dinar and a dirham,' quoting from the Prophet Muhammad (peace and blessings of Allah be upon him).
As the conference proceeded, in-depth analyses of international banking and financial practice were delivered by several speakers. Dr. Rodney Shakespeare, head of the Christian Council for Monetary Justice in the UK as well as visiting professor of Binary Economics at Trisakti University in Jakarta, gave a very clear exposition of the nature of money, usury and how modern banking practice is fraudulent in nature and how it represents the opposite of its own arguments. Being Christian, he was not versed in the Islamic legal judgments on money and muamalah and hence could not comment on the gold dinar and silver dirham. Nevertheless, his presence and presentation marked the international implications of the conference; that the subjects addressed were not only for Muslims and Malaysia in particular but also greatly pertinent for the Christian world as well, which statistically is the largest religious body of the world. He said that if the Muslims do not do something about responding to the problem of usury then nothing will happen because it is in the nature of the Islamic faith to oppose Riba while there is no such thing in the daily practice of Christians.
Further on, numerous solutions were presented as measures that could be undertaken to turn away from banking practice, including the Islamic banks and Islamic financial institutions. That turning away also connotes the turning away from modern money which is electronic and paper because the very first entry of money into the economy is by means of debt from the central bank and money cannot be credit by nature; this is also mainly because of fractional reserve banking, hence the problem of inflation. Of them, one was a proposition by Prof. Ahmed Kameel Mydin Meera, which he called interest-free credit money with gold and silver as a measure of value. His analyses of modern monetary economics and the solutions that he proposes as response to monetary Riba may be found in his website: www.ahamedkameel.org.
Dr. Yasin Dutton, associate professor in Arabic and Islamic studies at the University of Cape Town, presented an easily comprehensible demonstration using some real gold and silver coins and little pieces of paper to illustrate how paper money and fractional reserve banking were introduced by the first bankers. He gave important historical information and literary references to elaborate his point. He emphasised that zakat is collected, not given and that too in ayn (tangible merchandise) not dayn (debt/credit which paper money is really).
Another speaker from Canada, Mr. Parvez Nasim, chairman of the Islamic Co-operative Housing Corporation Ltd. and Ansar Co-operative Housing Corporation Ltd. of Canada, presented his Riba-free home-financing working model that has been operating the last 28 years and how the same model may be replicated in Malaysia. He did not however, tackle the issue of the real-estate bubble. Real-estate and banking are twin industries, one complementing the other. Nevertheless, his presentation could be a much better alternative to a housing loan from banks, government or private. Results showed that not only had most of his debtors paid off their interest-free housing loans in seven years or less, which is less than one-third the repayment period for a usual bank loan for a house, but investors in the project also got their dividends from the repayment. It seemed to operate on the Islamic banking model, as well as taking advantage of rising prices in the real-estate industry. In case the housing bubble was to burst, the Ansar Cooperative would suffer great loss. A Canadian questioner pointed it out to the speaker after the talk. Though such proposals were presented, the focus of the conference kept returning to usury and money.
Riba (Usury) and money were the two concentrated subjects at hand. The primary issue that has to be handled when seeking to establish halal (permitted) trading using gold and silver as money, is the problem of the re-pricing of all goods and services into the proposed money system, or rather the traditional money system (gold, silver and other metals of lower value, if necessary, to price goods that value below the lowest denomination of silver in circulation). When one tackles this problem, which seemed to baffle many amongst the participants of the conference, one must also take into consideration the advantage of modern technology (electronic and internet, for examples) that was not available in the past. No speaker in the conference had taken up the problem of re-pricing all goods and services, though some speakers, especially Prof. Vadillo, know the subject well and had already been practically tackling the problem, for example in Kelantan since the launch of the dinar and dirham as commodity-currency last Ramadan. Attendants would have left the conference hall with more confidence in the use of the dinar and dirham as currency if this had been presented to them by at least one speaker.
Most questioners who expressed superficial disagreements to the dinar and dirham had only done so out of the inability to understand how re-pricing of goods and services could be done. To them the problem was too complex to tackle. In fact paper and electronic money had been the sole cause for pricing of goods and services to have become complex and this is a very recent problem, which for thousands of years no one had experienced. Prof. Yasin Dutton mentioned that today one can buy a sheep (or even two depending on its age and gender) for one dinar which in the past had cost the exact same price. A mans suit had always cost an ounce of gold in Europe and today a reasonably well made mans suit costs the same or to give another example, a chicken in Rome as well as in the Madinah of the Prophet Muhammad (May peace and blessings be upon him) had cost the equivalent of one silver dirham and today too it costs the same in most parts of the world. Hence the pricing difficulty is a very recent phenomenon, which in fact could easily be settled with a return to gold and silver as a measure of value.
Chief Minister of Perak, Dr. Zambry, mentioned that the state of Perak is in the process of minting its own gold dinars and silver dirhams, perhaps based on the model of Kelantan, the same way the Muslim leaders of Aceh, Pattani, the Sulu Sultanate and another state in Malaysia their desire to do the same in the past. Dr. Zambry encouraged the audience to save and invest wealth in gold and silver.
Lastly, Mr. Shirazdeen Adam Shah, the organising committee chairman of the conference together with Dr. Muhammad Abbas presented a paper on the necessity of public education on the various subjects pertaining to Riba including monetary economics and finance. The ulama more than any other body should be taught the subject first for while being the source of the spreading of knowledge in Islam, their traditional madrasah training equips them inadequately, if at all, on the gravely important subject of Riba. How to educate students and the public were also touched on in the course of the talk. Mr. Shirazdeen also mentioned that children from a very young age must be taught at homes and schools about Riba and money. He concluded that the organisers of the conference will work on establishing a research centre and think tank in Malaysia first and then elsewhere for conducting studies on Riba and the 'pitfalls and flaws found in the current economic and monetary system.' It will then use all technological means possible to engage in public education and proposing responses to avert Riba in daily life. It will be connected to important international Muslim organisations and mosques. It will be called the RIFCON Centre for Research on Riba (RCRR). RIFCON meaning Riba-free Economy.
HRH Dr. Yahaya Abu Bakar, Etsu Nupe and Chairman of the Niger State Council of Traditional Rulers, expressed his desire to host the 2nd World Riba Conference next year in Nigeria. It was announced by Prof. Ahmed Kameel that next years conference will concentrate on the legal tender issues of implementing the gold dinar and the silver dirham as currency and therefore would require legal experts to take part in it. Every speaker was presented with a gold dinar gift as a token of appreciation for having presented at the conference while the attendants were given a book that had almost all the lectures already printed and compiled for them before hand. A passer-by would have noticed one similarity in all those present at the conference: everyone was seen wearing a gold RIFCON badge somewhere on their attire.
A follow-up seminar to the conference has been arranged on 22nd December at the same hall in PWTC, but focusing specifically on technical issues relating to the implementation of the gold dinar and silver dirham as currency.