Lets discuss the primary purpose of Islamic Economy and how it is related to Islamic Social Entrepreneurship. From my view point, the primary purpose of Islamic Economy is to create an ethical and moral economic system which creates wealth and at the same time caters for both the poor and the rich. Therefore, the wealth creation process must have the goal to provide empowerment for the disadvantaged and poor, including narrowing the wealth gap between the rich and poor. It is therefore vital that any business ensures that the community benefits from its activities.

Indeed Sukuk can be designed to serve the specific needs of any sector of the population, including the less fortunate. For example, Salam, diminishing Musharakah or even sovereign sukuk can be issued for agricultural purposes such as irrigation infrastructure or harvesting crops, implementing weather stations, etc.

Sukuk for Islamic social entrepreneurship

Both Islamic Economics and Islamic Social Entrepreneurship share some similarities namely the empowerment of communities by narrowing the wealth gap between the rich and poor. With the goal of poverty alleviation, interested parties or governments can set up an Islamic Social Entrepreneurship Special Purpose Entity (SPE) which will enable the collection of funds by issuing Sukuk. Funds raised through the issuance of Sukuk can be targeted to provide funding to Islamic Social Entrepreneurs on the on the basis of profit sharing modes of Musharakah or Mudarabah by the SPE.

Dr. Thamina Anwar