OPINION: “Sukuk – David Cameron’s Vindication Of Governor Aregbesola”

Date Posted: December 3, 2013 at 7:13 am

David Cameron’s vindication of Governor Aregbesola Had the throng of unthinking critics of the Aregbesola administration not been blinded to see anything good in its efforts to re-engineer the finances of the state, they ought to be sobered by the news coming in from the United Kingdom that the government of British Prime Minister David Cameron would soon become the first in the non-Islamic world to issue a Sukuk – the Sharia compliant bond to raise $324 million.

To start with, it isn’t exactly true to suggest that Islamic bonds are anything new to the predominantly Christian British society; British companies such as HSBC and Tesco are known to have issued Islamic bonds in the past. What is new is that Her Majesty’s government has finally found the wisdom in tapping into Middle Eastern investors’ huge cash reserves whose unique attraction is that it is interest-free and allows the investor a share of the profit from an underlying asset.

Now, the typically conservative Brits not only consider it a strategy to solidify London’s status as a global financial hub, allowing it to fighting off the EU’s encroachments, but one designed to open up the city to international players. The country’s Finance Minister George Osborne even did an opinion piece for the Financial Times to extol the potentials of the Islamic financing option.

Now, how is the British issuance of sukuk relevant to the state of Osun? The answer is – in several ways. First, it is more than ample vindication of the state governor, Ogbeni Rauf Aregbesola who has long insisted that while the sukuk may be Islamic in origin, it is like other financial instruments, not tied to any religion or creed. For a state yearning for development funds, his position was that the state could use the sukuk window to further its development agenda given the relatively higher cost of alternatives.

The development in the British Isles therefore answers directly to the asinine charge by elements of the opposition and their company of sympathisers that the use of the globally recognise financial instrument is a ploy to Islamise the state of Osun. Another way of saying that development capital would flow towards those who have the mind, will and discipline! Now, it seems doubtful that the critics would be silenced by the fact that Britain – a highly developed nation – is only now tapping into the financial instrument to address its own development needs. That obviously is a reflection of how light years behind the thinking of those who claim to have the answers to the challenges facing the state is.

Conversely, it is a measure of how far-sighted and daring the Aregbesola administration has been in its attempt to re-order the state’s finances – something that only a transparent administration, one that has nothing to hide can contemplate. That was why this newspaper celebrated it as something of a breakthrough when the news first broke; and this against the background of what we know to be the strict requirement to access the bond market.

Of course, the administration could have bandied the usual refrain of lack of funds as an excuse for doing nothing – which was what the immediate past PDP administration did. Rather, it has since shown that with rigour, courage and the determination, the possibilities available for development as many as they are infinite depending on whether or not the leader is willing to put his mind to work.

The lesson here is that a lot can be achieved to turn the tide of development in the State of Osun provide the right leadership is in charge. Today, no longer is the debate as to what the N60 billion debt programme expected to be deployed to finance education projects and other allied infrastructure can achieve. Hopefully, the embrace by Prime Minister Cameron of sukuk would settle the dust over the matter for the state to make progress.


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