Sudanese parliament declines to approve loans over usury concerns
May 30, 2011 (KHARTOUM) – The Sudanese national assembly delayed approving three loan agreements signed between the government and other countries over concerns that it involves usury.
Islamic law prohibits usury, the collection and payment of interest, also commonly known as ‘Riba’. However, very few Islamic countries enforce this rule.
The loans include ones from Kuwaiti Economic Development Fund and the Arab Fund for Socio-Economic Development.
The parliament speaker Ahmed Ibrahim Al-Tahir was quoted by state news agency as saying that the country is keen on adhering to Islamic Shari’a laws particularly with regards to avoiding usury.
Al-Tahir said during discussions of these loan agreements that this issue cannot be resolved through voting but has to be referred to Islamic scholars to provide their opinion on its conformance with Islamic law.
But the Sudanese finance and national economy minister Ali Mahmood Hassanein defended the loans saying that Sudan’s options for borrowing are limited.
“If we block these loans all our developmental projects will come to a halt,” Hassanein said and pointed out to previous precedents approved by the country’s Islamic Fatwa board.
“This is the path available before us and we are governed in our dealings with these international institutions,” he added.
But presidential adviser Ibrahim Ahmed Omer rejected the minister’s justifications saying that any exceptions should not be taken lightly and that any loan approval should be done on a case by case basis.
However, several MP’s expressed support to the minister’s assertions warning that rejecting the loans would jeopardize development in the country.
Sudan hasn’t been able to borrow from the World Bank since 1993 because of its failure to make payments on its debt. That may leave the south, one of Africa’s poorest regions, ineligible to borrow from the bank. Sudan has debt arrears of about $30 billion, according to the Washington-based Center for Global Development.
For credit the country relies on selling Islamic bonds, known as Sukuk, among other domestic borrowing, and by external loans from China, Arab nations, India and other countries.
(ST)
Paul Ongee
Sudanese parliament declines to approve loans over usury concerns
Look at the mentality of Khartoum, religion first or economic development? Northern Sudan may soon come to a dead end economically because of some restrictive Islamic laws. It’s becoming a war between religious circle and international economic development fund system.
This is what I often refer to in most of my comments; competitive interpretation of Quran to govern this country of Northern Sudan, physically located in Africa but mentally in the repressive Middle East monetary system which few countries enforce “Riba.” The choice is yours, avoid being caught up in parliament and Islamic scholars’ club over Riba or promote socio-economic development fund that attracts investors.
Northern Sudan should not compare itself with Iran and other Islamic countries applying restrictive Islamic laws. These countries have sound economic base compared to Sudan constantly plagued by war, political instability and reliance on Southern Sudan oil reserves.
Paul Ongee
Khartoum Watch