UK Tories would maintain Islamic finance focus

LONDON, (Reuters) - The UK Conservative Party would foster the development of Islamic finance as much as the Labour government, if it comes to power after next year's general election, an Islamic finance expert linked to the Party said.

Mohammed Amin, partner and head of the UK Islamic Finance practice at PricewaterhouseCoopers (PwC), said at a conference on Wednesday: 'All the ways (in which) Labour has supported Islamic finance would be every bit as valuable under David Cameron (Conservative Party leader) as prime minister.

'The next conservative government would be very supportive of Islamic finance,' he told delegates of the Islamic Finance News Roadshow 2009 conference in London.

Amin said he was speaking as vice-chairman of the Conservative Muslim Forum, an affiliate of Cameron's party working to encourage support from the Muslim community.

The UK has undergone a series of tax and law changes in the last few years to allow the launch of retail Islamic-compliant services such as mortgages, bank accounts and insurance.

In April the budget 2009 changed the tax regime to facilitate Islamic-debt issuance and encourage the growth of London as an Islamic finance hub.

Rules were changed to remove fiscal penalties to UK companies willing to issue sukuks, or Islamic bonds, effectively ending a regime which would have double-taxed the transactions needed to set up a sukuk.

The government however shelved its plans to launch a sovereign sukuk last November, citing the troubled market conditions in the wake of the Lehman Brothers ( LEHMQ -news - people ) collapse.

Amin said the Conservative party had been quiet about the Islamic finance field because there was 'no political mileage' in highlighting the achievements of the Labour government.

The Conservative Party is widely tipped to be the winner of the next general election next year. The party did not return Reuters' requests for comment.

(Reporting by Cecilia Valente; Editing by Jon Loades-Carter) Keywords: CONSERVATIVES/ISLAM

Link: http://www.forbes.com/feeds/afx/2009/09/17/afx6899245.html