Press Release: Sharm el-Sheikh Economic Conference Will Not Fix What Was Marred by the Capitalist System

Sharm el-Sheikh Economic Conference Will Not Fix What Was Marred by the Capitalist System

Through hosting the economic conference in the city of Sharm el-Sheikh, starting from today Friday 13 March until Sunday, the Egyptian regime seeks to do what is known as attracting billions of dollars of foreign investment, with the aim of increasing the rate of growth of the Egyptian economy. The state has prepared a list of 50 projects seeking to persuade investors of their economic viability. The state amended the investment law to give incentives and advantages for investors, including granting investors land with the right of utilization value of one pound and other mechanisms of ownership, or that the state should pay part of the insurance of the workers or give incentives specific to different sectors. Investment Minister Salman Ashraf predicted the success of the conference to attract projects worth between 10 to 15 billion dollars. The regime sees the survival of this conference as its lifeline, and relies so much on it to get it out of the severe economic crisis stuck to its collar and almost choking it. What is strange is that the regime behaves in an investment mindset; as if the solution out of this crisis is by attracting a lot of money to the Egyptian market to raise the level of domestic income. Even though the current regime received a package of massive aid from its supportive Gulf States, which exceeded 200 billion Egyptian pounds, yet the regime still suffers and the crises are successive, most recently are the gas and petrol crisis.

The disease lies within the capitalist economic system that is applied in Egypt, a system that carries the disease within, because it views that human needs are unlimited whereas goods and services are limited, i.e. neediness and poverty are natural and inescapable. This system has been applied for more than three centuries in their country which is reeling under the brunt of the global crisis; did it solve the problem of poverty, unemployment or debt? Despite its looting of wealth and sucking the blood of humanity, so why all the ranting for this corrupt system? Why are they trying to solve our problems by recycling this system, which is void and unable to provide us with radical solutions, thus it is necessary to eradicate it from its roots.

This conference does not solve the economic problem plaguing the country, and if it produces results, its benefit will not be more than the increase in GDP growth rates, which in reality is not a solution nor a standard that reflects the true economic situation of the country, it is simply to increase the total income of all the people combined, and not individually. It is possible that a handful of business people might increase people’s individual income, people might then think that there is a state of economic recovery, but actually it is a mirage and illusion, and what took place is that the wealth of a certain person increased which increased the GDP.

Therefore we confidently say, that whoever builds the foundations of his economy on this oppressive basis his people will inherit nothing but more poverty and loss, Allah (swt) says:

أَفَمَنْ أَسَّسَ بُنْيَانَهُ عَلَى تَقْوَى مِنَ اللَّهِ وَرِضْوَانٍ خَيْرٌ أَمْ مَنْ أَسَّسَ بُنْيَانَهُ عَلَى شَفَا جُرُفٍ هَارٍ فَانْهَارَ بِهِ فِي نَارِ جَهَنَّمَ وَاللَّهُ لَا يَهْدِي الْقَوْمَ الظَّالِمِينَ
“Then is one who laid the foundation of his building on righteousness [with fear] from Allah and [seeking] His approval better or one who laid the foundation of his building on the edge of a bank about to collapse, so it collapsed with him into the fire of Hell? And Allah does not guide the wrongdoing people” [At-Tawba: 109]

The solution is known and lies in the great Ahkam of Islam:

1. Shariah rulings came to ensure the provision of the basic needs to be satisfied completely by each member of the state, including food, clothing, housing. Islam obliged the capable man to work to provide for himself first and on whom he is obliged to spend on. As for those who cannot work like the disabled nor those who have no breadwinner, Islam obliged the state to provide for them, the Prophet (saw) said,

«الإمام الذي على الناس راع وهو مسئول عن رعيته»
“The Imam is the shepherd of the people and is responsible for his flock”,

In his capacity as the Head of the Islamic State and the Ruler in charge in it, he (saw) said,

«من ترك كَلاًّ فإلينا ومن ترك مالاً فلورثته»
“Whoever leaves a Kal behind (after death), it is for us (the state will provide for him) and whoever leaves inheritance money (after death), I will inherit it (Bait ul Mal).” Kal is the one in need who cannot provide for himself.

2. Islam guaranteed the possession of wealth of individuals by permitting ownership; this acquisition is regulated by Shariah rules that must be complied with. Therefore, ownership of money and acquisition of wealth is easy and far from the complications which dominates the capitalist system. But at the same time Islam did not allow freedom of ownership, where man can possess anything at will and by any means as long as it does not infringe upon the freedom of others, where society is transformed into a pack of wolves that struggle for the acquisition of money.

3. Shariah rulings have detailed the issue of ownership and differentiated between individual property, public property and state property, and thus it has ensured that the people benefit from what is entitlement and necessary without monopolizing wealth by individuals or the state itself, because Islam has given the state specified property to enable them to carry out the burdens assigned to it without acquiring the property of individuals or public property.

4. Shariah rulings have guaranteed the equitable distribution of wealth among the people, and took into account the differences between them, which could lead to the circulation of wealth between the rich class alone or prevent others from its access. We find Islam has addressed this issue by laying down Ahkam Shariah that ensures the circulation of wealth among all people, like the prohibition of hoarding of gold and silver. Islam also obliged the State to restore the balance in the distribution of wealth, giving the surplus money to the poor not the rich, according to the saying of Allah (swt):

كي لا يكونَ دُولةً بين الأغنياءِ منكم
“so that it will not be a perpetual distribution among the rich from among you” [Al-Hashr: 7]

Not only in order to fulfill the need of the poor, but in order to enable him to acquire money and to develop projects and others.

5. Islam has prevented the individual from increasing his wealth through non-Islamic means, such as usury, monopoly and cheating in selling and illicit fraud, and thus has preserved how a society should be like, an Islamic society with unique style of living.

6. The main reason which made Egypt suffer economically despite its bounties of great riches and resources, is this interest-based system that it deals with, costing Egypt 34.7 billion dollars of foreign debt, up to 11.9% of the GDP. The accrued interest per annum on the total debt service amounted to a quarter of total public expenditure of Egypt in a year. This means that the state cannot recover these affects even if it doubled its production. The usurious system and interest-based loans are able to destroy any economy, no matter its size, and this is exactly what strong economies like America and Europe suffer from. Islam firmly addressed the issue of usury; Islam not only prohibits usury, even more Allah and His Messenger waged war against the one who take it, and the Qur’an described the one dealing in riba like the one beaten by Satan into insanity,

الَّذِينَ يَأْكُلُونَ الرِّبَا لَا يَقُومُونَ إِلَّا كَمَا يَقُومُ الَّذِي يَتَخَبَّطُهُ الشَّيْطَانُ مِنَ الْمَسِّ ۚ
“Those who consume interest cannot stand [on the Day of Resurrection] except as one stands who is being beaten by Satan into insanity” [Al-Baqara: 275]

Islam not only the prohibited usury, but also presented a system that prevents it from occurring, Islam obliged the state to meet the needs of its citizens of living. And whoever needs capital for investment, Islam recommended giving interest-free loans. Islam prohibited financial firms such as stock and shares companies, as it prevented the majority of the current financial dealings in the stock market, the speculation and the sale of goods or documents before their acquisition, etc., and prohibited insurance companies and its contracts in all its forms. All of these haram institutions not based on real economy led to a huge artificial financial bubble which exploded and was the direct cause of the global economic crisis in 2008 and its exacerbation.

Islam revealed various permissible contracts to increase money from trade and others. A society that implements Islam does not have a need for usury, and it is not permissible to conduct such transactions nor the forbidden contracts. So all the causes that lead to the outbreak of a severe crisis, not only this but the Islamic economic system liberates the country from dependence on the West and liberates it from the clutches of the Kafir colonists.

7. The encroachment on public property that has occurred in Egypt in recent years deprived people from getting their rights guaranteed to them by Islam. Through privatization the country’s wealth has been squandered and looted at the hands of people who fled like vultures with what they stole. Since oil wells, gas, mining, land and others is a public right since are all public property; individuals or private-owned companies are not permitted to own them. They will be confiscated and returned as public property. Shariah rulings will be the basis to judge whether they have the right to be compensated or not, as well as the contract privileges of these companies in public property such as the rights of unjust mining will be abolished, and the state should extract the wealth of the land by itself and for the public interest or rent those who can do so but under its supervision until it is able to do so.

8. The monetary system used today plays a pivotal role in the current crisis, because the money in the state is not based on real value, and this increases the rates of inflation and rising prices, which people find unbearable. While the implementation of the Islamic economic system in Islam will restore the gold and silver base, i.e. money issued will carry 100% the value in gold and silver, so it will have an intrinsic value. One dinar in Shariah weighs 4.25 grams of pure gold, and one dirham in Shariah weighs 2.975 grams of silver, and in the case of crisis they maintain their value in cash between people, and they are strong factors for the stability in the economy, and stops the sharp drop in the value of the currency at the first crisis and it melts in the hands of the people, as is happening now and so increase the crisis will add more crises, and if we take into account the abundance in Egypt of gold mines, it is not difficult to find the gold to cover the cash flow.

These are only a fraction of the countless Islamic rulings regarding the economic system which alone is capable of pulling the country out of the economic deterioration felt by everyone. It will bear fruit when it is implemented in the Khilafah State upon the method of Prophethood that Hizb ut Tahrir together with the Ummah seek to establish to bring the greater good and prosperity, as the Messenger (saw) said about the second guided Khilafah,

«لا تَدَعُ السَّمَاءُ مِنْ قَطْرِهَا شَيْئًا إِلا صَبَّتْهُ مِدْرَارًا، وَلا تَدَعُ الأَرْضُ مِنْ نَبَاتِهَا شَيْئًا إِلا أَخْرَجَتْهُ»
“The sky will shower abundantly every piece of land, and the sky will produce all it goodness and blessings”

وَلَوْ أَنَّ أَهْلَ الْقُرَى آمَنُوا وَاتَّقَوْا لَفَتَحْنَا عَلَيْهِمْ بَرَكَاتٍ مِنَ السَّمَاءِ وَالأرْضِ وَلَكِنْ كَذَّبُوا فَأَخَذْنَاهُمْ بِمَا كَانُوا يَكْسِبُونَ
“And if only the people of the cities had believed and feared Allah, We would have opened upon them blessings from the heaven and the earth; but they denied [the messengers], so We seized them for what they were earning.” [Al-A’raf: 96]

Sharif Zayed
Head of the Media Office of Hizb ut Tahrir
in Wilayah Egypt