A section of Members of Parliament on Tuesday protested the proposal by Bank of Uganda to reverse the requirement of establishing the Shari’ah Advisory Council to operationalise Islamic banking in Uganda after Central Bank officials said there are no Muslims in the country with experience and knowledge to sit on the advisory council.
Addressing MPs on Tuesday, Tumubweine Twinemanzi, the executive director, banking supervision at Bank of Uganda revealed that the country has no PhD holders in Islamic financing.
“If you are going to advise an existing supervisor, your standards or level of experience must be above that which the supervisor already has. We went and had discussions with various groups within the Muslim community trying to find these people internally,” Twinemanzi noted.
“What we have noticed is that we have very many people with knowledge and experience in Shariah law, actually, we do have PhDs in Islamic Financing in this country, and some have been teaching Islamic financing for close to a decade, but when you ask them if they have experience in financial services in this country, the answer is no,” Twinemanzi added.
Commenting on government’s position, Butambala County Member of Parliament, Muwanga Kivumbi tasked Bank of Uganda to furnish parliament with evidence showing that there are no Ugandans experienced to sit on the advisory council.
“In all honesty, that is a very weak reason. The regulations you cite, are set by you, they aren’t statutory. When we give you an act to implement, you have a duty to frame a regulation that implements the act as is, but not to fail it. I don’t think you have looked around carefully and ascertained that there are no Muslim scholars that qualify, have you advertised and therefore flouted it around,” Muwanga said.
Muwanga also rejected the claim made by Bank of Uganda officials that naming some Muslims to the board would anger others due to the various sects in Islam, citing division in Christianity.
Parliament was on Tuesday expected to pass amendments to the Tax Amendment Bill, 2023 to pave the way for the introduction of Islamic Banking in Uganda.
Islamic banking is guided by Shari’ah principles as laid down in Islamic commercial law. While Shari’ah is a legal framework within which the affairs of a Muslim’s life are governed, Islamic banking applies only a portion of Shari’ah which relates to commercial transactions.
Like other religions, Islam prohibits Usury/interest which is a backbone of conventional banking system. In addition to interest, Islam prohibits other unethical business conducts such as; excessive uncertainty, gambling, speculation and materialism.
