>JAKARTA, Mar 04, 2009 (AFP) - Islamic finance and banking must be developed as an alternative to the discredited Wall Street model of doing business, the World Islamic Economic Forum resolved as it wrapped up Wednesday in Indonesia.

More than 1,550 delegates including prime ministers, presidents, princes and sheikhs from 38 countries issued a declaration calling on the Islamic Development Bank (IDB) to take the lead in promoting Islamic finance.

They also called for "effective regulations" in the conventional global financial industry to "mitigate risk and failure" in the aftermath of the Wall Street collapse triggered by a credit crunch in the US housing sector.

The declaration expressed support for the IDB Task Force for Islamic Finance and Global Financial Stability to "promote Islamic finance and banking as a viable alternative to the conventional financial system."

It also called on "governments and Islamic banks to expand sharia (Islamic) compliant micro-credits" to small businesses in the developing world.

"The declaration has a host of policy recommendations that, if implemented widely, would enact real change within the Muslim and non-Muslim world," World Islamic Economic Forum Foundation chairman Tun Musa Hitam said.

The fifth Islamic economic forum opened in Indonesia, the most populous Muslim country and the largest economy in Southeast Asia, on Monday.

smc/mtp

© Copyright AFP 2009.

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