Racial And Social Integration For Muslims

Building Institutions – a path to social and racial integration for Muslims in the American Society

Institution – An established organization or corporation (as a bank or university) especially of a public character

Offering Liberal Arts and Engineering curriculum, East West University is an excellent example of a simple idea turning into a local institution, serving not only its original constituents, but a much larger community by evolving into a seamless local institution. Even with these large numbers, it is hard to find a single reputable large medical institution started or run by members of the Muslim medical community. Doctors are arguably the most affluent Muslim community in the US and have the opportunity to take a leadership role in the institution building process. For any community to flourish the availability of capital for consumer and commercial purposes is paramount; for this reason alone the lack of Islamic financial institutions in the US is of significant concern; having institutions that serve the special needs of the Muslim community by providing Shariah compliant financial products and offerings is a necessary step forward. Activities such as home buying and business investments increase an individual’s stake in the community, and this impact is almost more important than all others; this in my opinion is the seed that allows individuals to take an interest in there surrounding environment and participate in the community at a heightened level.

Middle East based Investment banks and Private Equity companies have also started to open offices in the US, Arcapita (owners of Church’s Chicken and Caribou coffee chains), Kingdom Holdings and Unicorn Investment Bank are examples of such companies. Some of these institutions especially Kingdom Holdings has been involved in taking positions and doing deals for over 10 years, but these overseas companies do little to engage the local communities in the US and therefore tend to have very little impact on the local landscape. Any future dialogue leading to collaboration at the local level could benefit both sides.

Islamic finance is currently estimated to be a $400 Billion business worldwide, and according to the UK-based Islamic Finance Information Service $16.9 billion in Islamic bonds (Sukuks), were issued in the first 10 months of 2006 – 43 percent more than all Islamic bonds issued in 2005. The success of Shariah compliant financing instruments in the UK serves to strengthen and validate the market worldwide. For the US market the creation of additional institutions and products is a necessity, Credit Cards, Bonds (Sukuks) Auto inventory, equipment and financing and construction loans are some of the areas that need development and investment.

For any community to flourish the availability of capital for consumer and commercial purposes is paramount; for this reason alone the lack of Islamic financial institutions in the US is of significant concern; having institutions that serve the special needs of the Muslim community by providing Shariah compliant financial products and offerings is a necessary step forward. Activities such as home buying and business investments increase an individual’s stake in the community, and this impact is almost more important than all others; this in my opinion is the seed that allows individuals to take an interest in there surrounding environment and participate in the community at a heightened level.

Suddenly, in fall of 2005 the Muslim community in the blue color city of Birmingham found itself at odds with its non Muslim neighbors. The creation of local institutions facilitates and helps communities organize in an influential manner. These give the community a sense of ownership and stake, allowing its members to participate and influence the overall agenda.

In order to avoid paying interest many successful Muslim families don’t participate in homeownership and other interest related activities. Over the last five years Guidance Financial has started offering home mortgage products to the US Muslim community.

I fear that if Muslim professionals don’t set examples now, and fail to create leadership icons today, they will also fail to inspire the future generations.

For the American Muslim community, the current landscape is fairly bleak. The existing infrastructure consists of mostly religious hubs such as Mosques and Islamic schools; these are the first to mushroom in any new community and help regulate the basic needs of its members, e.g. prayers, marriages, religious education, funeral services etc.

Even with these large numbers, it is hard to find a single reputable large medical institution started or run by members of the Muslim medical community. Doctors are arguably the most affluent Muslim community in the US and have the opportunity to take a leadership role in the institution building process. Organizations such as AAPNA, with an established member community and access to funds should prioritize efforts to help identify and support candidates who can be developed into business leaders via education and training.

On the commercial front, Shariah compliant lending institutions are no where to be found. There are some local institutions such as Devon Bank in Chicago and University Bank in Michigan that are starting to dabble with commercial lending, but being small community banks they are limited in there resources. The lack of a developed Islamic secondary market forces many institutions to carry the loans for the duration of the term, which creates a liquidity problem.

Offering Liberal Arts and Engineering curriculum, East West University is an excellent example of a simple idea turning into a local institution, serving not only its original constituents, but a much larger community by evolving into a seamless local institution. Even with these sporadic successes a tremendous amount of work still needs to be done on the education front in other locations and communities.

Over the last decade the Islamic education sector has seen rapid growth, this is largely due to significant demand for quality primary education by affluent and mostly professional Muslim parents. In principal these schools are structured similar to the Catholic school system and focus on teaching standard curriculum with additional focus on Islamic education.

As the above mentioned examples illustrate, some preliminary work is being done to build institutions by the Muslim community, but unless the urgency is felt on a broader scale, these efforts will continue to be “test cases” and “one off” scenarios.

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