A Malaysian consortium, consisting of a global shariah advisory firm Amanie Advisors and a boutique law firm CSQlaw, aims to establish its first international office in Kazakhstan within the early second quarter of this year.
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A Malaysian consortium, consisting of a global shariah advisory firm Amanie Advisors and a boutique law firm CSQlaw, aims to establish its first international office in Kazakhstan within the early second quarter of this year.
In a media statement in conjunction with MIHAS 2019, held at MITEC Kuala Lumpur, the consortium shared that once their application is approved, they will be the pioneering Islamic finance service provider from ASEAN to set up office in Astana International Financial Centre (AIFC), Kazakhstan.
The first international office in Kazakhstan will be specialising in providing Shariah compliant financial services and legal advisory including human capital development. They will also look at the opportunity of bringing more Malaysian companies to explore the market in Kazakhstan specially to provide services in Islamic finance related business such as asset management, mutual fund and consultancy services.
With the introduction of AIFC last July, Kazakhstan is seen as the potential market for developing Islamic finance within the central Asian region. Under AIFC it focuses on five critical sectors including Islamic finance, fintech, green economy and asset management.
The decision to participate in AIFC is made in view of the overwhelming interest on pursuing Shariah compliant products and standards not only in banking sectors but also other businesses.
Kazakhstan has 18 million population with 70% of them are Muslim. To date, there are two full-fledged Islamic banks in Kazakhstan i.e. Hilal Bank, an international bank based in Abu Dhabi and Zaman Bank, a local bank having collaboration with Islamic Cooperation for Development of Private Sectors (ICD), a major private sector development arm of Islamic Development Bank Group.
According to MATRADE, the bilateral trade between Malaysia and Kazakhstan has seen an encouraging improvement to RM200 million in 2017. For a record, Kazakhstan is one of the largest gas producers and the largest uranium producer in the world.
Malaysia has been largely invested in the oil and gas sector for decades. However, the export of professional services to Kazakhstan are relatively low compared to other sectors.
We also see a low investment amount from Kazakhstan to Malaysia. Having said that, its sovereign wealth fund, Samruk- Kazyna equivalent to Malaysian Khazanah Nasional is among the top 30 sovereign wealth funds by asset in the world with assets valued at US$67.4 billion.
The Consortium hopes that with the establishment of their first international office in Astana, it will pave ways for more Malaysian businesses to consider this market as the gateway to the central Asian region which is greenfield to Malaysian players.
By having a Malaysian consortium in Astana, Malaysian companies will be more comfortable and secure to do business here as we will be licensed by the authority to provide legal and consultancy services.
It is also more convenient for Malaysian and ASEAN companies to engage with us, as we share common values with ASEAN entities and understand their business needs.
The biggest concern among the market players in Malaysia are mainly language barrier and the laws and regulations since Kazakhstan adopts civil law system. However, under AIFC regime, the laws are based on common law and mostly the officers in Astana speak good English.
While the official language is still in Russia and Kazakh language, the business community uses English as one of the medium of communication.
In October, the Consortium has been mandated by the Government of Malaysia through Malaysian External Trade Development Corporation (MATRADE) under Services Export Fund (SEF) to conduct a feasibility study on Kazakhstan as the potential market for Islamic finance professional ancillary services in Malaysia. The study will be completed by April 2019 and shall be published in a comprehensive report by the Consortium for public consumption.
“The Consortium applauds Matrade’s efforts in pushing more professional services to explore beyond Malaysian borders. We trust that Malaysia has a lot of success story to tell the central Asian audience especially in the field of Islamic finance. The support by MATRADE is very crucial to encourage more players who are ready to export their services overseas to chart their international business journey.”