2 MUSLIM NATIONS REVIVE ISLAMIC COMMON MARKET
N. VASUKI RAO | Sep 29, 1991 8:00PM EDT
Two populous Muslim nations, Bangladesh and Pakistan, are refloating the idea of an Islamic common market to cope with what they say are adverse trends in world trade.
Reports from Dacca and Islamabad say the proposal has support from Saudi Arabia and Iran.The idea of such a market was first proposed by Bangladesh at an Islamic summit in Saudi Arabia a decade ago. Some studies were carried out but little progress made.
Bangladesh renewed the idea at the recent meeting of the Islamic Chamber of Commerce, Industry and Commodity Exchange. It now suggests a timetable for a phased development of the idea.
Pakistan’s President Ghulam Ishaq Khan backed the idea during a visit to Iran earlier this month.
Addressing a special session of the Iranian parliament, Mr. Khan alluded to President Bush’s “new world order.” He urged the Muslim world to draw up a collective action plan for economic integration and setting up of institutions.
While institutional cooperation should be considered in all sectors of economic activity, “our ultimate objective should be two-fold,” he said.
“First, to create an Islamic common market to meet our consumption requirements and development needs; second, to develop our own capital market and an Islamic reserve bank to provide financial security and balance of payments support to member countries in conformity with Islam’s economic ethics.”
The Pakistani president saw considerable scope for such amarket. The Islamic world has about 20 percent of the world’s population and land mass. It produces 50 percent of the world’s oil and accounts for 40 percent of the world’s export of raw materials.
Mr. Khan said this “enormous potential” has not been harnessed and exploited. As a result, the total gross national product of Islamic countries is only 4.5 percent of world GNP.
Bangladesh feels an urgent need for Muslim countries to bandtogether and seek alternative markets. Officials there citequantitative restrictions by developed countries on imports,fluctuating commodity prices and increasing debt burdens.
The Uruguay Round of trade negotiations are”immobilized” due to the ”uncompromising” attitude of developedcountries, according to Dacca officials. Those multilateraltalks are held under the aegis of the General Agreement onTariffs and Trade, the Swiss-based overseer of world merchandisetrade.
Of particular concern to Bangladesh is the question ofagriculture subsidies and restrictions on textiles, both crucialto some Islamic countries. They have bogged down the talks.
In Dacca’s view, the world is on the brink of a trade war, andits first victims would be developing countries. Officials areurging Islamic institutions in such vital sectors asinternational trade, banking, reinsurance and shipping.
