Introducing Islamic Finance Opportunities – Insights from Dubai

An interview with Mr. Ashley Freeman, English qualified lawyer with over 30 years of exclusive specialization in financial services. 

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Islamic Finance continues to gain global recognition for its ethical principles, asset-backed structures, and long-term investment orientation. While the sector remains at an early stage of development in Romania, our mission at the Romanian Arab Investments House is to introduce local investors to the core concepts and financial instruments that define this responsible and dynamic system — from Sukuk and Islamic investment funds to Sharia-compliant banking solutions.

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As part of this effort, and prior to bringing such products to the Romanian market, we believe it is essential to offer our clients direct insight into jurisdictions where Islamic Finance is already well-established. To that end, we engaged with a leading expert from the United Kingdom, one of Europe’s pioneering markets in Islamic Finance, to share perspectives on market evolution, investor demand, regulatory support and the practical challenges shaping the sector today.

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Question 1:

How is the Islamic Finance landscape evolving in your region and what key trends are shaping investor interest?

Answer:

The UK was one of the ‘early adopters’ of Islamic finance in the modern era and there have been Islamic finance products (and Islamic banks) in the UK since the 1980s.  Much of the growth has been driven by London’s historic status as a global financial centre, combined with the UK’s stable economy, tough but innovative financial services regulation and fairly predictable investment returns on its real estate.

 

Question 2:

What types of Islamic Finance products are most in demand among investors in your region today and why?

Answer:

Investment accounts and money-market operations are always a stable product for HNWs, but real estate investment continues to hold the Islamic market together (as it does in most countries). 

 

Question 3:

What challenges do investors face when accessing Islamic Finance opportunities in your market?

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Answer:

The biggest issue in the UK is always the tax treatment of products, but the UK Government has done a lot of good work in recent years trying to level the playing field between conventional finance and Islamic finance.  Sometimes the education, communication and familiarity level between parties (both on the institutional and private investor side) can be an issue in Islamic finance, but significant improvement in bridging that gap has been seen in recent years. 

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Question 4:

What regulatory or market developments are supporting growth in Islamic Finance within your region?

Answer:

There are various governmental and quasi-government-private sector bodies supporting the sector including the Government’s Task Force on Islamic Finance, The City UK Islamic finance advisory group, the UK Islamic Finance Council, the UK Islamic Fin-Tech Panel, Bank of England working parties.  There is genuine consensus between Government and private sector on the need to support the sector.  This has proved extremely valuable for ensuring legislative and regulatory change as well as raising the sector’s profile both nationally and internationally.    

 

Question 5:

What advice would you give to investors in new markets, such as Romania, who are exploring Islamic Finance for the first time?

Answer:

It is critical to take accurate advice from professional people (lawyers, accountants, tax advisers) who are experts in this area.  Unfortunately, entry into the advisory market is not always well-regulated and many people who purport to be “experts” are not.  Always work with a law firm (like Dutescu & Partners) who have people with formal qualifications and/or proven first-class experience in the sector over many years. 

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Closing Note

As Romania begins to explore opportunities in Islamic Finance, our objective is to ensure that investors gain a clear understanding of the system’s values, structures, and long-term benefits. By drawing lessons from mature markets such as the United Kingdom and other established financial centres, Romanian investors can build confidence and approach this sector with informed expectations and trusted professional guidance.