Islamic Finance as an Alternative of Infrastructure Financing for Asian Landlocked Developing Countries

Mohammad Asif Nıaman; Hakan Aslan

Makale detayları

Islamic Finance as an Alternative of Infrastructure Financing for Asian Landlocked Developing Countries

Yazarlar:

Mohammad Asif Nıaman | Hakan Aslan

Yayıncı:

Afyon Kocatepe University

Ana Başlıklar:

İslam Finansı

Dergi:

Kocatepe İslami İlimler Dergisi Vol.6 Issue Özel Sayı, pp.38-63

Belge Tipi:

Makale

Yayın Tarihi:

10/2023

Belge Dili:

İngilizce

Document ID (Org No.):

2001301087

pISSN:

2757-8399

Anahtar kelimeler:

Özet:

 Various infrastructure financing methods are being used worldwide, each with its own set of advantages and obstacles. Basically, the advantages and disadvantages of a financing method manifest differently depending on each countrys economic system, geographical location, economic dependency, political conditions, cultures, and beliefs. Using a funding strategy in one country may be beneficial under certain situations but harmful in another. As a result, the usefulness and efficacy of financing methods should be studied in light of the countries circumstances. The Asian Landlocked Developing Countries LLDC, which share the same fate in terms of geographical constraints and economic reliance, are grappling with severe infrastructural gaps in all sectors. These countries have an emerging economy, are largely dependent on agriculture, have a poor management structure, are unorganised and have weak financial markets, and rely heavily on their neighbours transit routes to interact with the global economy. Some of these countries depend upon foreign assistance, and the lack of transparency and binding nature of this funding has had little impact on developing such countries infrastructure. As a result, in order to finance their infrastructure projects, these countries must select the most acceptable financing option for their circumstances. The national budget constraint, inadequate local financial markets, the risk of foreign credits, and cultural and religious values in these countries are among the obstacles that contemporary financing methods present. Consequently, looking for alternative financing methods for these countries infrastructure projects is critical. This paper intends to look at infrastructure financing methods and their challenges in Asian landlocked developing countries and evaluate Islamic finance as an alternative to conventional finance. The qualitative research method is used for this study. Furthermore, document analysis has been utilised as a data collection tool. First, the concepts of Islamic finance will be presented before moving on to the definitions and types of infrastructure. Afterwards, the conventional infrastructure financing methods, along with the shortcomings of these methods in Asian landlocked developing countries, will be discussed. Then the development of Islamic finance in Asian LLDCs will be studied. Finally, how Islamic finance addresses the challenges of conventional finance methods will be perused. The study found that the Islamic finance models, which are founded on the principle of shared income or risk sharing, can be implemented as an alternative to conventional finance in infrastructure financing. Public-private partnership PPP initiatives can be implemented effectively within the framework of Islamic financing concepts because the elements of the public-private partnership initiatives are congruent with Islamic finance principles. First of all, public-private partnership initiatives allow for risk sharing among project participants, including financiers. In addition, public-private partnership projects allow Islamic financiers to become project participants rather than just lenders. Following that, PPP infrastructure projects are by definition, free of speculation and gambling. Finally, project contracts are frequently well-specified and free of uncertainty. Besides this, creating financial inclusion and risk sharing in the framework of Islamic finance reduces the currency risk and the cost of financing and causes equitable distribution of wealth in society.

 Various infrastructure financing methods are being used worldwide, each with its own set of advantages and obstacles. Basically, the advantages and disadvantages of a financing method manifest differently depending on each countrys economic system, geographical location, economic dependency, political conditions, cultures, and beliefs. Using a funding strategy in one country may be beneficial under certain situations but harmful in another. As a result, the usefulness and efficacy of financing methods should be studied in light of the countries circumstances. The Asian Landlocked Developing Countries LLDC, which share the same fate in terms of geographical constraints and economic reliance, are grappling with severe infrastructural gaps in all sectors. These countries have an emerging economy, are largely dependent on agriculture, have a poor management structure, are unorganised and have weak financial markets, and rely heavily on their neighbours transit routes to interact with the global economy. Some of these countries depend upon foreign assistance, and the lack of transparency and binding nature of this funding has had little impact on developing such countries infrastructure. As a result, in order to finance their infrastructure projects, these countries must select the most acceptable financing option for their circumstances. The national budget constraint, inadequate local financial markets, the risk of foreign credits, and cultural and religious values in these countries are among the obstacles that contemporary financing methods present. Consequently, looking for alternative financing methods for these countries infrastructure projects is critical. This paper intends to look at infrastructure financing methods and their challenges in Asian landlocked developing countries and evaluate Islamic finance as an alternative to conventional finance. The qualitative research method is used for this study. Furthermore, document analysis has been utilised as a data collection tool. First, the concepts of Islamic finance will be presented before moving on to the definitions and types of infrastructure. Afterwards, the conventional infrastructure financing methods, along with the shortcomings of these methods in Asian landlocked developing countries, will be discussed. Then the development of Islamic finance in Asian LLDCs will be studied. Finally, how Islamic finance addresses the challenges of conventional finance methods will be perused. The study found that the Islamic finance models, which are founded on the principle of shared income or risk sharing, can be implemented as an alternative to conventional finance in infrastructure financing. Public-private partnership PPP initiatives can be implemented effectively within the framework of Islamic financing concepts because the elements of the public-private partnership initiatives are congruent with Islamic finance principles. First of all, public-private partnership initiatives allow for risk sharing among project participants, including financiers. In addition, public-private partnership projects allow Islamic financiers to become project participants rather than just lenders. Following that, PPP infrastructure projects are by definition, free of speculation and gambling. Finally, project contracts are frequently well-specified and free of uncertainty. Besides this, creating financial inclusion and risk sharing in the framework of Islamic finance reduces the currency risk and the cost of financing and causes equitable distribution of wealth in society.

 Various infrastructure financing methods are being used worldwide, each with its own set of advantages and obstacles. Basically, the advantages and disadvantages of a financing method manifest differently depending on each countrys economic system, geographical location, economic dependency, political conditions, cultures, and beliefs. Using a funding strategy in one country may be beneficial under certain situations but harmful in another. As a result, the usefulness and efficacy of financing methods should be studied in light of the countries circumstances. The Asian Landlocked Developing Countries LLDC, which share the same fate in terms of geographical constraints and economic reliance, are grappling with severe infrastructural gaps in all sectors. These countries have an emerging economy, are largely dependent on agriculture, have a poor management structure, are unorganised and have weak financial markets, and rely heavily on their neighbours transit routes to interact with the global economy. Some of these countries depend upon foreign assistance, and the lack of transparency and binding nature of this funding has had little impact on developing such countries infrastructure. As a result, in order to finance their infrastructure projects, these countries must select the most acceptable financing option for their circumstances. The national budget constraint, inadequate local financial markets, the risk of foreign credits, and cultural and religious values in these countries are among the obstacles that contemporary financing methods present. Consequently, looking for alternative financing methods for these countries infrastructure projects is critical. This paper intends to look at infrastructure financing methods and their challenges in Asian landlocked developing countries and evaluate Islamic finance as an alternative to conventional finance. The qualitative research method is used for this study. Furthermore, document analysis has been utilised as a data collection tool. First, the concepts of Islamic finance will be presented before moving on to the definitions and types of infrastructure. Afterwards, the conventional infrastructure financing methods, along with the shortcomings of these methods in Asian landlocked developing countries, will be discussed. Then the development of Islamic finance in Asian LLDCs will be studied. Finally, how Islamic finance addresses the challenges of conventional finance methods will be perused. The study found that the Islamic finance models, which are founded on the principle of shared income or risk sharing, can be implemented as an alternative to conventional finance in infrastructure financing. Public-private partnership PPP initiatives can be implemented effectively within the framework of Islamic financing concepts because the elements of the public-private partnership initiatives are congruent with Islamic finance principles. First of all, public-private partnership initiatives allow for risk sharing among project participants, including financiers. In addition, public-private partnership projects allow Islamic financiers to become project participants rather than just lenders. Following that, PPP infrastructure projects are by definition, free of speculation and gambling. Finally, project contracts are frequently well-specified and free of uncertainty. Besides this, creating financial inclusion and risk sharing in the framework of Islamic finance reduces the currency risk and the cost of financing and causes equitable distribution of wealth in society.

 Dünya genelinde, her birinin kendine özgü avantajları ve engelleri olan çeşitli altyapı finansman yöntemleri kullanılmaktadır. Temel olarak, bir finansman yönteminin avantaj ve dezavantajları, her ülkenin ekonomik sistemine, coğrafi konumuna, ekonomik bağımlılığına, siyasi koşullarına, kültür ve inançlarına bağlı olarak farklı şekilde ortaya çıkmaktadır. Bir finansman stratejisini bir ülkede kullanmak belirli koşullar altında faydalı olabilirken başka bir ülkede zararlı olabilir. Sonuç olarak, finansman yöntemlerinin yararlılığı ve etkinliği ülkelerin koşulları altında incelenmelidir. Coğrafi kısıtlamalar ve ekonomik bağımlılık açısından aynı kaderi paylaşan Asyanın Karayla Çevrili Gelişmekte Olan Ülkeleri LLDCKÇGOÜ, tüm sektörlerde ciddi altyapı eksiklikleriyle boğuşmaktadır. Bu ülkeler gelişmekte olan bir ekonomiye sahip, büyük ölçüde tarıma bağımlı, zayıf bir yönetim yapısına sahip, örgütsüz ve zayıf mali piyasaları olan ve küresel ekonomiyle etkileşim için büyük ölçüde komşularının transit yollarına bağımlı olan ülkelerdir. Bu ülkelerden bazıları dış yardıma bağımlıdır ve bu finansmanın şeffaf olmaması ve bağlayıcı olma niteliği, bu ülkelerin altyapısını geliştirmede çok az etkiye sahip olmuştur. Sonuç olarak, altyapı projelerini finanse edebilmek için bu ülkelerin kendi koşullarına en uygun finansman seçeneğini seçmeleri gerekmektedir. Ulusal bütçe kısıdı, yerel finans piyasalarının yetersizliği, dış kredi riski ve bu ülkelerdeki kültürel ve dini değerler, çağdaş finansman yöntemlerinin önündeki engeller arasındadır. Sonuç olarak, bu ülkelerin altyapı projeleri için alternatif finansman yöntemlerinin araştırılması kritik önem taşımaktadır. Bu çalışma, denize kıyısı olmayan gelişmekte olan Asya ülkelerindeki altyapı finansman yöntemlerini ve bunların zorluklarını incelemeyi ve İslami finansın geleneksel finansmana bir alternatif olup olmayacağını değerlendirmeyi amaçlamaktadır. Bu çalışmada, nitel araştırma yöntemine kullanılmıştır. Ayrıca veri toplama aracı olarak doküman analizinden yararlanılmıştır. İlk olarak, altyapı tanımlarına ve türlerine geçmeden önce İslami finans kavramları sunulacaktır. Daha sonra, geleneksel altyapı finansman yöntemleri ve bu yöntemlerin Asyanın denize kıyısı olmayan gelişmekte olan ülkelerindeki eksiklikleri tartışılacaktır. Daha sonra Asyadaki LLDCKÇGOÜlerde İslami finansın gelişimi incelenecektir. Son olarak, İslami finansın geleneksel finans yöntemlerinin zorluklarını nasıl ele aldığı incelenecektir. Çalışma, gelir ortaklığı veya risk paylaşımı ilkesine dayanan İslami finans modellerinin altyapı finansmanında geleneksel finansa alternatif olarak uygulanabileceğini ortaya koymuştur. Kamu-özel sektör ortaklığı PPPKÖO girişimleri İslami finansman kavramları çerçevesinde etkin bir şekilde uygulanabilir. Çünkü KÖO girişimlerinin unsurlarının İslami finans ilkeleriyle uyumlu olduğu gözlenmektedir. Her şeyden önce, KOÖ girişimleri, finansörler de dahil olmak üzere proje katılımcıları arasında risk paylaşımına izin verir. Buna ek olarak, KÖO projeleri İslami finansörlerin sadece kredi vermek yerine proje katılımcıları haline gelmesine olanak tanımaktadır. Bunu takiben, KÖO altyapı projeleri tanımı gereği spekülasyon ve kumardan uzaktır. Son olarak, proje sözleşmeleri genellikle iyi belirlenmiş ve belirsizlikten uzaktır. Bunun yanı sıra, İslami finans çerçevesinde finansal kapsayıcılık ve risk paylaşımı yaratmak, kur riskini ve finansman maliyetini azaltmakta ve toplumda refahın adil dağılımına neden olmaktadır.

Makale detayları

Islamic Finance as an Alternative of Infrastructure Financing for Asian Landlocked Developing Countries

Yazarlar:

Mohammad Asif Nıaman | Hakan Aslan

Yayıncı:

Afyon Kocatepe University

Ana Başlıklar:

İslam Finansı

Dergi:

Kocatepe İslami İlimler Dergisi Vol.6 Issue Özel Sayı, pp.38-63

Belge Tipi:

Makale

Yayın Tarihi:

10/2023

Belge Dili:

İngilizce

Document ID (Org No.):

2001301087

pISSN:

2757-8399

Islamic Finance

Asian Landlocked Developing Countries

Infrastructure Financing Methodsİslami Finans

Karayla Çevrili Asya Ülkeleri

Altyapı Finansman Yöntemleri

Sayı

Makale detayları

Islamic Finance as an Alternative of Infrastructure Financing for Asian Landlocked Developing Countries

Yazarlar: Mohammad Asif Nıaman | Hakan Aslan

Yayıncı: Afyon Kocatepe University

Ana Başlıklar: İslam Finansı

Dergi: Kocatepe İslami İlimler Dergisi Vol.6 Issue Özel Sayı, pp.38-63

Belge Tipi: Makale

Yayın Tarihi: 10/2023

Belge Dili: İngilizce

Document ID (Org No.): 2001301087

pISSN: 2757-8399

Islamic Finance

Asian Landlocked Developing Countries

Infrastructure Financing Methodsİslami Finans

Karayla Çevrili Asya Ülkeleri

Altyapı Finansman Yöntemleri

Sayı

Yazarlar:

Mohammad Asif Nıaman | Hakan Aslan

Yayıncı:

Afyon Kocatepe University

Ana Başlıklar:

İslam Finansı

Dergi:

Kocatepe İslami İlimler Dergisi Vol.6 Issue Özel Sayı, pp.38-63

Belge Tipi:

Makale

Yayın Tarihi:

10/2023

Belge Dili:

İngilizce

Document ID (Org No.):

2001301087

pISSN:

2757-8399