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13УДК 336
THE FUTURE OF THE DEVELOPMENT OF ISLAMIC FINANCE IN THE CONDITIONS OF THE MARKET ECONOMY
Agatayeva Aizhan, Omarova Aizhan, Kalymbekova Zhanna, Sadvakassova Ainash Assilova Aizhan, Al-Farabi Kazakh National University, Almaty, Kazakhstan E-mail: aikun-ai@mail.ru
Abstract. The article analyzes the indicators and changes in the gross domestic product of Kazakhstan (hereinafter - GDP) for the period from 2013-2017. The dynamics of the national currency exchange rate for the US dollar and the main indicators of the Commonwealth countries (hereinafter - the CIS) for 2013-2017 are given. The article shows trends in the influence of market economy conditions on the indicators of the country and the CIS. Therefore, the main priority objectives of financial policy should be further GDP growth with the mandatory direction of increasing the share of entrepreneurship. The issues of the need for the development of small and medium-sized businesses (hereinafter - SMEs) in Kazakhstan, as well as the problems of finding sources of business financing, are considered. Islamic finance is an alternative way to promote new forms of entrepreneurship and finance them. The ongoing changes in the countries of the commonwealth in the development of instruments of Islamic finance are shown. Kazakhstan is also considering the possibility of Islamic finance, implying high ethical principles, correlated in accordance with Sharia law.
Key words: entrepreneurship, GDP, Islamic finance, instruments of Islamic finance, market economy
БУДУЩЕЕ ИСЛАМСКОЙ ФИНАНСОВОЙ СИСТЕМЫ В УСЛОВИЯХ РЫНОЧНОЙ ЭКОНОМИКИ
Агатаева Айжан Айтукызы, Омарова Айжан Кажыгуловна, Калымбекова Жанна Калымбековна, Садвакасова Айнаш Болаткановна, Асилова Айжан Сарсеновна, Казахский национальный университет им. Аль-Фараби, Казахстан, г. Алматы E-mail: aikun-ai@mail.ru
Аннотация. В статье проведен анализ показателей и изменений валового внутреннего продукта Казахстана (далее - ВВП) за период 2013-2017 гг. Приведена динамика курса национальных валют за доллар США и основные показатели стран содружества (далее - СНГ) за 2013-2017 гг. В статье рассмотрены тенденции влияния условий рыночной экономики на показатели страны и СНГ. Поэтому основными приоритетными целями финансовой политики должен стать дальнейший рост ВВП с обязательным направлением увеличения доли предпринимательства. Рассмотрены вопросы необходимости развития малого и среднего бизнеса (далее - МСБ) в Казахстане, а также проблемы поиска источников финансирования предпринимательства. Альтернативными методами продвижения новых форм предпринимательства и их финансированием могут послужить исламские финансы. Показаны происходящие изменения в странах содружества в области развития инструментов исламского финансирования.
Казахстан также рассматривает расширение исламского финансирования, подразумевающего достаточно высокие этические принципы.
Ключевые слова. ВВП, исламские финансы, рыночная экономика, предпринимательство, инструменты исламского финансирования.
1. Introduction
Islamic financing become one of the priority topics for Astana International Financial Center established in 2018. For Kazakhstan, this is an opportunity to attract investments for the development of entrepreneurial activity. The Islamic financial system appears as an economic model consisting of ethical foundations, which eliminates waste and opens up an open era of equitable distribution, based on the social and ethical principles of general welfare. Islamic banking will be able to open the doors of a completely new class of investors for Kazakhstan.
But again, currently there is a big problem of introducing new Islamic products into the local financial system, which is mainly subject to the modern laws of the market.
Islamic financing will contribute to raising the level and expanding the range of banking services (mudaraba, musharak, murabah, etc.). With the expansion of banking services through Islamic financial products, banks will be able to attract new customers and implement a positive positioning of the banking sector in business and in society in the market.
2. Materials and Methods
The work was based on thorough analysis of the works of foreign and domestic authors, as well as on Kazakhstan media materials on the development of Islamic finance on the governmental level. The methods of mathematical statistics were used when analyzing the statistical material of official information sources.
3. Results
Social and economic transformations in the CIS countries largely depend on financial policy and instruments of state regulation of the economy. Over the past decade, the globalization of economic processes necessitates the hedging of business processes closely related to economic and business ties, states and companies, and
many other factors. Moreover, the situation is complicated by the global financial crisis, and as a result, many SMEs are becoming bankrupt.
If we consider the national economy of Kazakhstan according to Table 1, it can be seen that GDP in the national currency is growing, since the annual growth rate of USD exchange rate was 18% (179.19KZT per 1 USD) in 2014, 24% (221.73KZT) -in 2015 and 54% (342.16KZT) in 2016 correspondingly, but in 2017 the annual inflation rate was 5% (326.00KZT) comparing to the previous year. If one calculates exchange rate increase in 2017 (326.00KZT) compared to 2013 (152.13KZT), she can see that the growth rate was more than 2 times. It should be noted that the GDP index has increased 6.3% in 2013, but the period from 2014-2017 demonstrates a decline in comparison with 2013. At the same time, it should be noted that in 2017 the GDP indicator is approaching the GDP of 2014 and its annual growth rate is 104.10%.
At the same time, if one focuses on the dynamics of Kazakhstan's GDP represented in Figure 1 for the period from 2013-2017, she can see that the growth trend is observed only in the national currency representation, but in US dollars, growth is not observed, because inflation is growing every year. Only in 2017 there is GDP increase in the amount of 25 609.10 billion US dollars, with an annual growth rate of 18.6%.
As a result of discussions about the future of Islamic finance development in the CIS countries in a market economy, it can be stated unequivocally that growth trends are observed. The fundamental principles of Islam in economic relations lie on the pursuit of benefits, the promotion of respect for human rights, the promotion of cooperation, the approval of only the profits which were earned as a result of beneficial and positive activities, prohibition of anything that contains oppression of people, elements of uncertainty, harmful for the religion, life and people, anything that breeds enmity and conflict between people.
Entrepreneurship plays an important role in the stability of a developed state. In those countries where there is stable economic stability, as a rule, the share of entrepreneurship in GDP is more than 60-75%. Active participation in the development of the SME economy, affects the provision of competitiveness of the country's economy.
At present, Kazakhstan's comparatively low competitiveness on the foreign market is related to the raw materials orientation of the economy, the under development of financial markets, which predetermines structural and institutional reforms. Therefore, Kazakhstan in strategic development has chosen the path of diversified economic development with the leading role of the private sector and SMEs.
Table 1
Main socio-economic indicators [1]
Years 2013 2014 2015 2016 2017
National Economy of the RK
Gross domestic product by production method
million Tenge (KZT) 35999025,10 39675832,90 40884133,60 46971150,00 53101281,80
million USD 236633,30 221417,70 184387,00 137278,30 162887,40
Index of physical volume of gross domestic product by production method
as a percentage of the previous year 106,00 104,20 101,20 101,10 104,10
as a percentage of the previous 1991 206,30 215,00 217,60 220,00 229,00
If we consider the processes taking place in the economy of Kazakhstan, in general, they are accompanied by positive changes in the sphere of SMEs. From year to year, the growth of SMEs is observed, the number of people employed in entrepreneurship is growing, with the output of products by SMEs is increasing.
As of September 1, 2018, the number of operating small and medium-sized businesses depicted in Table 2, compared with the corresponding date in 2017, increased by 4.2%. In the total number of small and medium-sized businesses, the share of individual entrepreneurs was 64.9%, legal entities of small business - 18.5%, cattles or farmer households - 16.4%, and medium-sized businesses - 0.2% [1].
In the conditions of a market economy, there are some conditions for the growth of SMEs, but taking into account various factors affecting the cyclicity of the economies of countries in the world, it is conditioned by close cooperation in many ways and areas. It turns out that the crisis affects many countries. Therefore, many international associations are paying more attention to the relatively new financial instruments - Islamic financial products. As it turned out, only Islamic financial products became immune to the global financial crisis.
According to the traditional Islamic economy, Islamic finance is based on Islamic prescriptions, therefore all business relations are using Sharia principles. These principles are aimed at fulfilling obligations to the one Supreme and preventing the most unfair practices in the production of public goods.
Differentiation of Islamic finance in the market economy lies in the use of special mechanisms to prevent the harmful impact of society in order to maximize profits. First of all, the Islamic economy does not allow running business based on speculative transactions and real assets. The actual value added is based on real performance and should not be treated as a gain on the sale of financial instruments.
Fig. 1 Kazakhstan GDP dynamics
Legislation on the creation and formation of Islamic finance in Kazakhstan was adopted in 2010. Particular attention is paid to the development of Islamic finance in the Road Map for the Development of Islamic Finance - 2020 and its main directions. These include:
a) improving the legal framework for the development of Islamic finance in the country and Islamic banking;
b) development of international economic relations with Islamic institutions;
c) promotion of the market of Islamic financial products;
d) massive assistance and outreach for similar sources that finance investments. On July 5, 2018 the official opening of the International Financial Center
"Astana" (hereinafter - IFAC) was held. The opening was visited by the President of Kazakhstan Nursultan Nazarbayev. The Head of State stressed out that the establishment of the IFC is a sign of trust and confirmation of the high appreciation of the successful development of our country by the international business community. Experts who got acquainted with the financial center during the presentation noted that all conditions were created there to make the center a convenient platform for the countries of Central Asia, the Eurasian Economic Union, and for the One-Way-One Way initiative. Since that moment, the MFCA stock exchange is considered open. Striking a gong was a world tradition before the start of a new trading session[2].
Table 2
Number of operating SMEs as of September 1, 2018 [7]
Units
Total Including Total, in percentage to the corresponding period of the previous year
legal entities of small business legal entities of medium sized business individual entrepreneurs farmers
Republic of Kazakhstan 1 207 374 223 828 2 555 783 389 197 602 104,2
Akmolinskaya obl. 44 087 6 887 114 32 427 4 659 102,9
Aktyubinsk obl. 53 124 9 447 103 37 946 5 628 104,9
Almaty obl. 115 061 9 826 159 59 765 45 311 101,7
Atyrau obl. 45 906 6 844 110 36 546 2 406 107,1
West Kazakhstan obl. 39 797 5 760 97 27 658 6 282 105,9
Zhambyl obl. 62 651 5 745 53 39 906 16 947 105,2
Karaganda obl. 82 084 16 634 188 56 701 8 561 101,7
Kostanay obl. 51 028 7 037 157 38 320 5 514 103,5
Kyzylorda obl. 40 988 5 051 61 29 825 6 051 111,3
Mangistau obl. 49 860 8 140 80 39 677 1 963 108,1
Pavlodar obl. 42 903 9 044 101 30 484 3 274 103,7
North-Kazakhstan 28 557 4 772 131 20 062 3 592 101,1
Turkestan obl. 128 322 6 819 46 53 323 68 134 104,4
East Kazakhstan 87 011 10 602 176 60 651 15 582 104,9
Astana 105 815 39 152 249 66 252 162 108,9
Almaty 171 477 60 561 621 109 756 539 99,3
Shymkent 58 703 11 507 109 44 090 2 997 109,4
According to the Entrepreneurship Code of the Republic of Kazakhstan dated October 29, 2015 No. 375-Vfor the purposes of state statistics, the criterion of referring to small and medium-sized businesses only according to the average annual number of employees is envisaged.
At present, Al Hilal Bank, a subsidiary bank of Al Hilal Bank, is operating in Kazakhstan, which is the first Islamic bank in Kazakhstan and CIS countries[3]. Up to date, practiced Islamic financing instruments include Musharak, Salam, Ijar, Murabakh. Below are the advantages of the directions of these agreements:
1) Musharaka has a special feature that is to create a new enterprise and create a small business, it is a very effective tool for SME development when using an effective partnership mechanism for entrepreneurship. The Musharak agreement is based on an equal partnership; such a partnerships are a combination of natural, labor and financial resources to generate income. The basis of Musharak is the implementation of a business plan and financing of an investment project, and its profitability by a financial institution and client. At the same time, the profit is distributed in a predetermined sharebetween the financial institution and the SME organization, and the value is divided by the contribution that it makes to the partnership. The Musharak business process has four key steps described in Table 3. Musharak's peculiarity is that partners can be investors, and their number is not strictly limited.
In Kazakhstan, certain types of state support are used to support large innovation projects and start-ups, often thanks to the partnership of major development institutions in the creation and strengthening of entrepreneurship, i.e. The National Agency for Technological Development, Investment Fund of the Republic of Kazakhstan is a long-term partnership in business.
2) The Salam Treaty can serve as an effective tool for SME development. The essence of the agreement is to financethe transaction, taking into account the future supply of assets. At the same time, the financing party is able to earn the necessary working capital for small farmers and traders. On the one hand, Salam is an alternative source of financing, and secondly, a new (seasonal) productive capital. That is why this tool is optimal for agriculture in Kazakhstan.
3) In Kazakhstan, certain types of state support are used to support large innovation projects and start-ups, often thanks to the partnership of major development institutions in the creation and strengthening of entrepreneurship, i.e. The National Agency for Technological Development, Investment Fund of the Republic of Kazakhstan is a long-term partnership in business
2) The Salam Treaty can serve as an effective tool for SME development. The essence of the agreement is to finance the transaction, which takes into account the future supply of assets. At the same time, the financing party is able to earn the necessary working capital for small farmers and traders. On the one hand, Salam is an alternative source of financing, and secondly, a new (seasonal) productive capital. That is why this tool is optimal for agriculture in Kazakhstan.
4) If the entrepreneur does not have enough funds to finance the asset, the financing method is the Murabaha agreement. The Murabakh business process is presented in Table 4. Murabaha is also an enterprise support tool, like consumer credit.
Agriculture is one of the major developing sectors of Kazakhstan's economy. The agro-industrial sector of Kazakhstan has a high potential for high appraisal and investment. In 2012, JSC "Fund for Financial Support for Agriculture" was established in Kazakhstan, and the Islamic Development Bank provided the Murabakha program to rural entrepreneurs. Table 5 demonstrates the key performance indicators of the domestic fund in the period from 2013-2017.
While analyzing the data in Table 5, it become evident that the loan portfolio on average increases by 28.8%, and the number of active borrowers averages an increase of 22.6%. However, the issuance of loans in terms of the number leaves much to be improved, because only in 2017, the figure was close to the indicator of 2014. The volume of issued funds in 2017 exceeds the indicator of 2013 by 24.3%, and in the period from 2014-2016 demonstrates a relative decline. The employment in the period from 2014-2016 had a tendency to decline, and only in 2017 this figure is relatively close to 2013, but less by 2.7%.
Undoubtedly, a timely made governmental decision on the agrarian sector is being implemented, measures are being taken to improve it, funding is increasing, state programs and mechanisms are being implemented. According to statistical data on annual gross output, foreign investment in national production, new agricultural facilities were created, there is a general dynamic of positive changes. However, the existing measures are not enough, since the imported products price growth, rising
food stock prices, rigid mechanism and structure of agricultural exports are the problems that remain relevant. Therefore, the widespread introduction of Islamic finance to finance business in the country can be used as an alternative to governmental financing and subsidies, and will help to improve indicators showing the growth of the country's economic welfare in a market economy.
Table 3
Musharak Business Process
Step Description
1. The preliminary technical and economic feasibility of the project is determined and the volume of investments is indicated arid a partnership agreementbetween the bank and the partner is concluded.
2. Joint financing of the proj ect (in an agreed amount)
3. Joint work is carried out to implement the project
4. "Upon completion of monitoring;, partners calculate the pro fit (loss) from the proj ect in a pre-agreed prop ortion
Table 4
Murabakha business process
Step Description
1. The client of the bank asks the bank to purchase certain goods, paying a belated payment.
2. With a positive decision, the bank receives the goods from the sender. The goods are the property of the bank.
3. The bank sells goods to its client for a long time at a new price with the right of ownership.
It should be noted that Islamic finance is actively developing not only in Kazakhstan, but also in the neighboring countries of the commonwealth.
At the same time, in Kazakhstan, Islamic finance tools will be improved with the help of the IFAC.
IFC plans to become a hub of Islamic finance in the region of the EEMP and Central Asia. At the same time, according to the representatives of the financial center, Islamic finance is one of the priorities of the structure[4]. Currently, the question of the issuance of Sukuk (Islamic bonds) by the Ministry of Finance on the IFAC site is being developed; along with this matter the Ministry of Finance together with the IFAC is negotiating with the Euroclear bank, which will allow placing domestic securities in national currency for international investors. It should also be noted that the Islamic bank Al Hilal offers private customers deposits of Wakala and Mudaraba. IFC plans to issue mortgages under Islamic laws.
Table 5
Key performance indicators of JSC «Fund for Financial Support of Agriculture» in the period from 2013-2017
Main indicators 201 J 2014 as a% ofthi jffevtcïïrs yaar 2015 asa<№ Of JjniOIH yaai 2016 asaÎS oftt-prévît vaai 2017 asa% oftt- previoari yaaf
Loan portfolio (billion tinge) 33113,0 51113 fi 149.9 692040 121.1 32900,0 119. S 103000,0 124.2
Xuint if of active borrowers (thousand people) 193 95 fi 24537,0 126.5 23941.0 117,9 36600,0 126,5 43 S00,0 119,7
Loans 2i anted (thousand) 11594,0 13423,0 115.S S3 54.0 62.2 11000,0 131,7 13200,0 120,0
Volume of issued funds (billion tenge) 29673,0 33590,0 130,0 27335,0 70,S 34900,0 127,7 43000,0 137,5
Provided with employment (thousand people) 9:70,0 14216.0 143.5 13505,0 95,0 12300,0 31,1 13337,0 112.5
Table 6 shows Russia's GDP trends for the period 2013-2017. At the same time, it is clear that comparing to the previous year, GDP in 2015-2016 decreased by 0.22.5%, but later in 2017, according to preliminary data, there was an increase of 1.5% and the indicators of 2013 are achieved. While reviewing the exchange rate data in Table 6, it can be noted that the exchange rate of the Russian national currency against the US dollar is worsening from 2013-2016, but in 2017 according to preliminary data the rate stabilizes and does not grow.
According to Figure 2, Russia's GDP in national currency has a growth trend, but in US dollars remains unchanged.
It turns out that the picture of GDP growth in Russia is also demonstrated only in the national currency data due to the growth of the exchange rate, however, converted in foreign currency it remains at a low level, as in Kazakhstan. Therefore, various factors of the market economy also affect the development of the Russian economy, in particular the need to increase the share of entrepreneurship in GDP.
Therefore, considering the tendencies of the development of Islamic finance in Russia, it can be noted that the special development of Islamic finance in Russia takes place in Tatarstan. In 2017, the President of the Republic proposed the creation of an International Center for a Partner's Economy, while earlier in the republic they planned to create a Center for the Development of the Islamic Economy, which would include all areas related to the Sharia. But now experts say that the introduction of Islamic
banking tools requires certain legal conditions and the improvement of the country's legislation. And only some financial institutes in Russia offer clients services related to Islamic financing.
Table 7 shows Kyrgyz GDP indicators for the period 2013-2017. Taking into account changes in the exchange rate of the national currency - the Kyrgyz som against the US dollar in Kyrgyzstan from 2013-2015, there is a decline in GDP, but in 2017, the indicator on preliminary data tends to GDP in 2013. If the rate of the Kyrgyz som in 2014 grows by 10%, and in 2015 - by 20%, then during 2016-2017 the exchange rate is being stabilized.
Table 6
Russia GDP dynamics [1]
GDP 2013 2014 2015 2016 2017
as a % of the previous year 101,8 100,7 97,5 99,8 101,5
billion USD 2298,4 2085,8 1374,7 1284,3 1578,6
billion of national currency 73133,9 79199,7 83387,2 85917,8 92081,9
currency exchange rate 31,8 38,0 60,7 66,9 58,3
Figure 3 shows for comparison purposes the GDP data in the national currency of Kyrgyzstan and US dollars, which shows that growth was due to changes in the exchange rate of the Kyrgyz som relative to foreign currency, and the GDP level in US dollars remains relatively unchanged.
In a market economy, our neighboring state also did not stand aside from the recession trends, which affected the country's economy, so in March 2009, the Kyrgyz parliament approved a law that allowed traditional banks to open "Islamic windows". Last year, a document was adopted, prescribing all the operations of an Islamic bank, so in early 2018, the second bank received a license to implement Islamic financing principles within the "Islamic window". And currently third bank is getting ready for such a license.
100000,0 73133.9 Russia GDP dynamics 79199.7 833S7.2 85917.S 92081.9
50000,0 0,0 •- - в -•-
2298.4 2085,8 1374.7 1284.3 1578.6
2013 2014 2015 2016 20171)
—»—billion USD -♦-billionof national currency
Fig. 2 Russia GDP dynamics [1]
Table 7
GDP dynamics in Kyrgyzstan [1]
GDP 2013 2014 2015 2016 2017
as a % of the previous year 110,9 104,0 103,9 103,8 104,5
billion USD 7,3 7,5 6,7 6,6 7,2
billion of national currency 355,3 400,7 430,5 458,0 493,3
currency exchange rate 48,7 53,4 64,3 69,4 68,5
Now let's pay attention to the GDP data of Uzbekistan in Table 8, which shows that the rate of the Uzbek som against the US dollar has a growth rate in 2014 by 10%, in 2015 by 11%, in 2016 by 16%, and in 2017, according to preliminary data, by 69%, accordingly; there are no changes in GDP in Figure 4 converted in foreign currency. And it is noteworthy to mention that the GDP figures in the national currency grow by 8% from 2013-2016, but according to the preliminary data of 2017 this figure has been reduced to 6%, but it is probably connected with the provisional nature. If GDP growth in foreign currency is observed in Table 7, there are no particular changes in Figure 4.
Fig. 3 Kyrgyzstan GDP dynamics
Table 8
Uzbekistan GDP dynamics [1]
GDP 2013 2014 2015 2016 2017
as a % of the previous year 108,0 108,0 107,9 107,8 105,3
billion USD 57,7 63,1 66,9 67,0 49,8
billion of national currency 120862 145846,4 171808 198871,6 249136,4
Currency exchange rate 2094,7 2311,4 2568,1 2968,2 5002,7
In Uzbekistan, Islamic finance is still in its infancy. The Ministry of Finance in May 2018 prepared a project that aims to create Islamic banking and finance in the country. The country intends to create an infrastructure for the introduction of Islamic principles of banking and finance, such as a ban on interest remuneration (Ribo), sharing with the entrepreneur profits and losses in proportion to the shares in the project and others. Also, the country plans to develop legal documents on the implementation of insurance activities (Takaful), leasing activities (Ijara), activities on securities transactions based on the principles of Islamic finance [4].
If in Table 8 of Uzbekistan GDP growth in foreign currency is observed, then in the graph of Figure 4 no particular changes are visible
Table 9 shows the dynamics of Tajikistan's GDP, where it can be seen that GDP growth up to 6% -7% during 2013-2017, in opposite direction with as the national currency rate; if the decrease rate was 4% in 2014, then in 2015 it jumped down to 24%, in 2016 fell by 27% and only in 2017, according to preliminary data, stabilized and amounted to an increase of 11%. If you look at Figure 5, then the Figure shows growth from the horizontal axis in both the national currency of Tajikistan and in foreign currency. It turns out that various environmental factors have created the need to consider Islamic finance as an alternative way of raising the economy as a whole.
Fig. 4 Uzbekistan GDP dynamics [1]
Table 9
Tajikistan GDP dynamics [1]
GDP 2013 2014 2015 2016 2017
as a % of the previous year 107,4 106,7 106,0 106,9 107,1
billion USD 8,5 9,2 7,9 7,0 7,1
billion of national currency 40,5 45,6 48,4 54,5 61,1
currency exchange rate 4,8 5,0 6,1 7,8 8,6
At the same time, in Tajikistan, the development of Islamic banking also began not long ago, in 2014. In the National Development Strategy of the country until 2030, the improvement of Islamic activity is prescribed. It is expected that the first Islamic bank in this country will start its operations this year.
Tajikistan GDP dynamics
40.5 45.6 48.4 54.5 ■ - 01,1 T
8.5 9.2 7.9 7.0 7.1
9 --- -
2013 2014 2015 2016 20171)
-•-billion USD > billion of national currency
Fig. 5 Tajikistan GDP dynamics [1]
For Kazakhstan, Islamic finance is an opportunity to attract investments. The Islamic finance appears as an economic model consisting of ethical foundations, which closes the era of dissipation and opens a new era of equitable distribution. In the basis of it lie not the principles of personal financial gain, but and social and ethical principles. Islamic banking will be able to open the doors of a completely new class of investors for Kazakhstan. In addition, Islamic finance can contribute to increasing the level of penetration of banking services (Mudaraba, Musharak, Murabakh, etc.). With an increase in Islamic financial products, banks will be able to attract new customers and carry out strategic positioning of the business in the banking industry. On the other hand, the introduction of Islamic financial products will create the possibility of expanding the range of attracted capital in the country's financial market.
4. Discussion
Islamic finance is a very important question in a market economy, it is being studied by various domestic and foreign authors from different aspects, and our work is consistent in terms of the conceptual apparatus on Islamic finance and processes. Our work presents a consolidated analytical paper considering situations on Islamic finance in neighboring countries. Statistical approach and analysis of data from various CIS countries, as well as data on the agro-industrial complex of Kazakhstan, as an initial result of interaction in one type of Islamic direction, together makes it possible to expect the growth of the domestic economy, since the widespread introduction of Islamic finance to fund business in the country as an alternative to government funding and subsidies, especially the country's agro-industrial complex, will improve performance of the economic.
5. Conclusion
As a result of discussions about the future of Islamic finance development in the CIS countries in a market economy, it can be stated unequivocally that growth trends are observed, because the fundamental principles of Islam in economic relations are the pursuit of benefits, the promotion of respect for human rights, the promotion of cooperation, the approval of only the profits that have been earned as a result of useful
activities, the prohibition of everything that contains oppression of people, the prohibition of relationships with elements of uncertainty, the prohibition of all malicious for the religion, life and honor of people, the prohibition of everything that breeds enmity and conflict between people.
Extensive introduction of Islamic finance in Kazakhstan is expected to contribute to the growth of the real sector of the Kazakhstani economy, increasing GDP in the range of 6-7% over four years with the active participation of the state, based on the Tajikistan data analysis. Because the Islamic financing is being promoted at the highest state level in Kazakhstan on the AIFC platform, it is expected to stimulate entrepreneurial activity through attracting capital and large global participants-users of the Islamic finance instruments in order to finance investment and large infrastructure projects.
List of references:
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