Amanie lends a hand in maiden Kazakh sukuk

By Habhajan Singh
A Malaysian based consulting firm is involved in launching the maiden Shariah-compliant fund and sukuk in Kazakhstan, a former Soviet republic which had just recently passed the legislations necessary for the development of Islamic finance.
Amanie Business Solution Sdn Bhd, an Islamic finance consulting outfit based in Kuala Lumpur, is working closely with Kausar Consulting from Kazakhstan in structuring the two products in what is surely one of the first few Islamic finance instruments being developed in the Commonwealth of Independent States (CIS) region.
CIS' countries include former Soviet Republics, including Armenia, Azerbaijan, Kazakhstan, Kyrgyzstan, Turkmenistan, and Uzbekistan.
Together with Western China, the region is said to be home to some 100 million Muslims. "Some of the work may be done out of Kuala Lumpur," said Amanie consultant Razi Pahlavi Abdul Aziz.
Amanie, led by respected Islamic finance scholar Dr Mohd Daud Bakar who also chairs the Shariah Advisory Council of Bank Negara Malaysia, has been involved in assisting Kazakhstan in putting in place its Islamic finance regulations.
On Feb 12, Kazakhstan president Nursultan Abishuly Nazarbayev signed into law amendments to allow for the introduction of the Islamic banking system in the republic.
The document is called "On introduction of amendments and supplements to certain legislative acts of the Republic of Kazakhstan concerning the issues of organisation and activity of the Islamic banks and organisation of Islamic financing".
"The working group for developing this law was created in mid-2007," said Kausar Consulting managing partner Yedige Alpysbay.
It consisted of representatives from local banks, the Agency for Regulation and Supervision of Financial Markets and Financial Organisations (FSA), National Bank of Kazakhstan (the central bank) and consulting firms specialising in Islamic finance including Kausar Consulting.
The Malaysian delegation consisting Amanie consultants and delegates from the Asian Islamic Investment Management (AIIMAN) attended the last sitting of the working group to review the draft of the law before it was presented to the Kazakhstan parliament.
"Kausar has a strategic partnership with Amanie," Alpysbay told The Malaysian Reserve in an email response. Kazakhstan is the first former Soviet Union republic to develop a legal framework for Islamic finance and at least three Islamic banks are expected to be launched.
In a statement released in Kuala Lumpur on March 5, the Kazakhstan embassy said the republic is the first of the Commomwealth of Independent States (CIS) country to develop a legal framework for Islamic finance.
"The importance of a legal framework for Islamic finance in Kazakhstan emerged a few years ago and was well supported by government bodies and the private sector," it said.
A number of Malaysian experts in Islamic finance, including the country's largest law firm, are said to be involved in the process of crafting the regulations.
On Nov 27, last year, The Malaysian Reserve reported that Zaid Ibrahim & Co had been appointed to ensure Kazakhstan's proposed Islamic banking laws are in line with prevailing international standards.

(This story appeared in The Malaysian Reserve on Mar 16, 2009. The Malaysian Reserve is a daily business/finance newspaper published out of Kuala Lumpur, with a sectoral page on Islamic finance on Mondays, edited by Habhajan Singh) Any source