Introducing Islamic Banking to the State’s Economic Model (The Case of Sudan)

Abstract

Both of the terms "Islamic banking" and "Islamic economics" were introduced for academic use only in the 20 th century.However, in recent years all over the world it has been increased a substantive interest to the financial instruments based on sharia law that is largely due to the direct involvement of the Gulf monarchies in the development of this mechanisms.It is important to know that only three countries -Sudan, Iran and Pakistan -have used Islamic economic model on the state level.Nowadays, the government of the latter officially abandoned this system, there is no proved and accessed data about the current Iranian financial framework.Therefore, Sudan seems to be the only working example of introducing the Islamic economic model on the state level and moreover the only country opened for the researches of this standard.This article aims to study the roots and development of Islamic banking in Sudan as the most popular activity of the Islamic economics realized in practice.It is necessary to research the social economic as well as political and international circumstances due to the fact that changes in Sudan in 1980-1990 decades caused not only the Islamization of the country but also the series of events that led the followings.The US Government listed Sudan among "State Sponsors of Terrorism" so the international community including states and international financial institutions imposed strict sanctions on the country.All this demonstrates the uncertainty of the results of the introduction of Islamic banking at first glance.So, despite the fact that Sudan is the unique example available for the study, the Sudanese reaction to all the internal and external problems should be identified before borrowing this experience.