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© Islamic Development Bank, 2016
King Fahd National Library Cataloging-in-Publication Data

Islamic Development Bank
          Islamic financial engineering lab /  Islamic
   Development Bank – Jeddah, 2016

     ISBN: 9960-32-320-X

1-Financial engineering   2-Islamic Finance l-Title
332 dc  1437/7789

L.D. no. 1437/7789
ISBN: 9960-32-320-X

All rights reserved. No part of this publication may be reproduced or
distributed in any form or by any means, or stored in a database or retrieval
system, without the prior written permission of the Islamic Development
Bank.

Disclaimer: This booklet is for information only. The information contained herein is
subject to change at the discretion of the Islamic Development Bank.

Images on Cover Page and Pages xii,14 and 34: Shutterstock.com

Contents

Acknowledgements ......................................................................................................................  VII

FOREWORD ...............................................................................................................................  IX

The IFE Lab ........................................................................................................................  1. 1

1.1. Objectives .......................................................................................................................  1

1.2. Agent Based Simulation and Modeling ......................................................................  2

Organization and Management of IFE Lab ......................2. ............................................  3

2.1. Mohammed V University ............................................................................................  3

2.2. Mohammadia School of Engineering- EMI .............................................................  6

2.3. Laboratory of Study and Research in Applied Mathematics- LERMA ...............  7

2.3.1. Research themes ..............................................................................................  7
2.3.2. LERMA Team .................................................................................................  8
2.3.3. LERMA projects and partnerships .............................................................  9

2.4. Islamic Development Bank (IsDB) .........................................................................  10

2.4.1. IsDB Vision ......................................................................................................  11
2.4.2. IsDB Mission ...................................................................................................  11

2.5. The Financial Product Development Center (FPDC) ..........................................  11

2.5.1. Process ...............................................................................................................  11
2.5.2. People ................................................................................................................  12
2.5.3. Products ............................................................................................................  12

2.6. Establishment of IFE Lab .........................................................................................  13

IFE Lab activities ...............................................................3. ................................................  15

3.1. Courses ...........................................................................................................................  15

3.2. Seminars .........................................................................................................................  16

3.3. Publications ....................................................................................................................  18

3.4. Internships ......................................................................................................................  20

IFE Lab Team ................................................................4. .....................................................  21

4.1. IFE Lab Advisory Committee .......................................................................................  21

4.1.1. Dr. Rajae Aboulaich ........................................................................................  21
4.1.2. Dr. Mohamed Tkiouat ....................................................................................  21
4.1.3. Dr. Sami Ibrahim Al-Suwailem ....................................................................  22
4.1.4. Dr. Ridha Saadallah ........................................................................................  22
4.1.5. Dr. Salman Syed Ali ........................................................................................  23

4.2. Executive Committee of IFE Lab ................................................................................  23

4.3. IFE Lab IsDB Coordinator ...........................................................................................  23

4.4. IFE Lab Professors .........................................................................................................  24

4.4.1. EMI Professors ................................................................................................  24
Dr. Mohammed Ryad .........................................................a. ...................  24

Dr. Rachid Ellaia ................................................................b. ...................  24

4.4.2. External professors ........................................................................................  24
Dr. Murat Yildizoglu .........................................................a. ...................  24

Dr. Yildiray Yildirim .........................................................b. ...................  25

Dr. Abderrafia Koukam .....................................................c. .................  25

Dr. Cars Hommes ..............................................................d. ...................  26

Dr. Francisco Doria ...........................................................e. ..................  27

Dr. Isabelle Salle ................................................................f. ...................  27

Dr. Mahmoud Sami Nabi ..................................................g. ..................  27

Dr. Mahmoud Bekri ..........................................................h. ...................  28

Dr. Mohammed Karrat ......................................................i. ..................  28

Dr. Ali Alami Idrissi ..........................................................j. ..................  28

Dr. Mohamed Amrani .......................................................k. ..................  29

Dr. Sami Assoulaimani ........................................................................  2l. 9

4.5. IFE Lab Students ...........................................................................................................  30

Admission to IFE Lab ............................................................5. ..........................................  32

Award for Best Application of ABS in Islamic Finance ................6. .............................  33

In the media ................................................7. ........................................................................  35

Acknowledgements

The Financial Product Development Center (FPDC) would like to accord its
sincere gratitude and appreciation to all the people who are attached with
the Islamic Financial Engineering (IFE) Lab for their time and efforts to
provide first-hand information of their own as well as the IFE Lab.

On behalf of the Center:
Houssem Eddine BEDOUI – Product Development Specialist, FPDC

Mohsin Sharif – Senior Technical Assistant, FPDC

FOREWORD

It gives us great pleasure to present this introductory booklet on the Islamic
Financial Engineering (IFE) Lab, a one-of-its-kind in the Member Countries
of the Islamic Development Bank (IsDB). The IFE Lab is a joint initiative of
the Financial Product Development Center at IsDB, and the Mohammadia
School of Engineering, at Mohammed V University, Rabat.

The IFE Lab engages in pioneering research in Islamic economics and finance
using modern technology, which has hitherto remained untapped. The recently
announced Award for Best Application of Agent-based Simulation in Islamic
Finance extends the reach of the new techniques to students worldwide. This
also serves the objective of the Islamic Development Bank to support Islamic
finance on a global scale.

Applying modern technology to develop complex systems and generating
models that can simulate products and markets based on principles of Islamic
economics is a breakthrough approach embraced by the IFE Lab.

The novel efforts of all members and participants in the IFE Lab are highly
commendable. We are looking forward to the exciting opportunities that the
IFE Lab will present to the field of Islamic economics and finance and to the
Islamic financial industry worldwide.

Dr. Ahmet Tiktik

Acting Vice President Finance,
Islamic Development Bank

Professor Rajaâ Cherkaoui
El Moursli

Vice President,
Mohammed V University

The IFE Lab1.
The Islamic Financial Engineering (IFE) Lab is a pioneering effort to bring
together modern technology and the principles of Islamic economics and
finance. It is a first-of-its-kind research laboratory, which applies novel
techniques to achieve implementation of these principles. The Lab is, therefore
of high value for supporting the objectives of the Islamic Development Bank
(IsDB) in expanding and leading the Islamic financial industry worldwide.
Furthermore, it aims to build a new generation of financial engineers in
Islamic finance to lead the industry in the 21st century.

As a 3-year Ph.D. program at the Mohammadia School of Engineering, the
Lab aims towards building a generation of pioneers in financial engineering
who succeed in applying modern techniques to implement the objectives of
the Islamic economics through ethical financial innovation. Candidates of
the Lab build models and contribute publishable work that identifies certain
challenges of Islamic financial industry and how they can be practically
solved.

The Lab capitalizes on the long-standing expertise of the Research
Laboratory for Applied Mathematics (LERMA) at the Mohammadia School
of Engineering, and the leading role of the Islamic Development Bank in
Islamic banking and finance, as represented by the recently established
Financial Product Development Center at IDB.

1.1. Objectives

The Lab aims to achieve the following objectives:

To develop, evaluate and test new Islamic financial instruments and  �
systems;

To find out how these models may be best implemented in real world  �
scenarios;

Assist the economic development of IsDB Member Countries (MCs)  �
and the Islamic financial industry by:

developing Agent-Based Simulation (ABS) platforms and building  ¾
reliable artificial markets and economies with many agent types,
in order to conduct scenario simulations that approximate the
reality.
building a new generation of Ph.D. candidates for the Islamic  ¾
financial industry who will succeed in applying modern techniques
to implement the objectives of Islamic economics by means of
innovative financial instruments.
contributing publishable work that identifies challenges of the  ¾
Islamic financial industry and how they can be practically solved.

1

1.2. Agent Based Simulation and Modeling

Agent-Based Model (ABM) is a class of computational models for simulating
the actions and interactions of autonomous agents (both individual and
collective entities such as organizations or groups) with a view to assessing
their effects on the system as a whole. It combines elements of game theory,
complex systems, computer science, and is applied to almost all fields of
knowledge, natural and social.

Agent-based models are a kind of micro-scale models that simulate the
simultaneous operations and interactions of multiple agents in an attempt to
re-create and predict the appearance of complex phenomena. The process is
one of emergence from the lower (micro) level of systems to a higher (macro)
level. As such, a key notion is that simple behavioral rules generate complex
behavior.

Most agent-based models are composed of:

Numerous agents specified with various propertiesa.

Simple rules for decision-making b.

Learning rules or adaptive processesc.

An interaction environment between the agentsd.

Agent-based models are typically implemented as computer simulations, either
as custom software, or via ABM toolkits, and this software can be then used
to test how changes in individual behaviors will affect a system’s emerging
overall behavior. Agent-based modelling can be very helpful in understanding
how complex phenomena might arise from simple interactions.

For more information on Agent-based simulation and modelling, the
following link provides a wealth of resources particularly for starters:

http://www2.econ.iastate.edu/tesfatsi/ace.htm

One of the most common software packages for Agent-based Simulation is
NetLogo, which is easy to use and has plenty of applied models:

https://ccl.northwestern.edu/netlogo

2

Organization and Management of IFE Lab2.
The IFE Lab is hosted by the Laboratory of Study and Research in Applied
Mathematics (LERMA) in the Mohammadia School of Engineering of
Mohamed V University, Rabat, Morocco. It is managed by two teams:
LERMA and the Financial Product Development Center of the Islamic
Development Bank, Jeddah, Saudi Arabia.

2.1. Mohammed V University

Mohammed V University is the first university of
Morocco after Al Karaouine in Fes. It is the first
modern university of Morocco, founded in Rabat
in 1957 and inaugurated two years later by the
late King Mohammed V. It has the distinction of
being the mother of Moroccan universities. Over
the years, Mohammed V University established
several branches in cities such as Casablanca,
Fes, Kenitra, Tangiers, and Tetouan, which
eventually became independent universities in
1975. A turning point in the history of Mohammed V University was 1993
when it was split into two independent universities, Mohammed V-Agdal
University (UM5A) and Mohammed V-Souissi University (UM5S)

In 2015, Mohammed V University - Agdal and Mohammed V University -
Souissi merged back into one University called Mohammed V University.

3

Mohammed V University is a public university that provides high quality
education to over 20,000 students annually. Its alumni include leading
government officials, ambassadors, academics, engineers, lawyers and
executives.

To align itself with the European higher education system adopted during
the Bologna Process, the University’s administrative and teaching faculty
worked together, from 2003 to 2012, to implement the three cycles of
qualifications system otherwise known as the “LMD System” (“License”,
“Master” et “Doctorat”; Bachelor, Master and Doctorate). This reform was
in line with the University’s vision and values:

Offering its students and partners a myriad of high quality study programs,  9
many of which lead to employment upon graduation;

Maintaining high standards of teaching and research on par with the best  9
universities in the world;

Helping students reach their full potential; 9

Strengthening international exchanges by developing ties and partnerships  9
with foreign institutions;

Responding to the socio-economic needs of the government and the  9
community

4

UM5A – Rabat offers a wide set of degrees both in the undergraduate and
graduate levels. The university has the following schools:

Mohammadia School of Engineering 9

School of General Technology 9

Teachers Training School 9

Faculty of Letters and Human Sciences 9

Faculty of Law, Economics and Social Sciences 9

Faculty of Science 9

Faculty of Medicine and Pharmacy of Rabat 9

Faculty of Dentistry Rabat 9

Faculty of Law, Economics and Social Sciences -Rabat- 9

Faculty of Law, Economics and Social Sciences -Salé- 9

National School of computer science and systems analysis 9

Faculty of Educational Sciences 9

Institute for the Study and Research for Arabization 9

University Institute for Scientific Research 9

Institute of African Studies 9

Ecole Normale Superieure of technical Education 9

5

2.2. Mohammadia School of Engineering- EMI

The Mohammadia School of Engineering (Arabic: المدرسة المحمدية للمهندسين;
abbreviated EMI) is the oldest School of Engineering in Morocco. EMI
was founded in 1959 by the late King Mohammed V as Morocco’s first
polytechnic. It is the largest institution of higher education in technology and
one of the leading technical schools in Morocco.

In 1981, upon the order of the late King Hassan II, EMI became the first school
combining academic and military education. Following the establishment of
polytechnic schools in many European countries, schools in the early years
of the 19th century were often based on the model of “École Polytechnique”
of Paris in 1794.

After three years of studying, the students would be awarded with the ‘Grandes
Ecoles d’ingénieurs’ degree, a Bac+5 in the French education System, and the
equivalent of a Master degree. The students would be awarded a rank of
Reserve Officer too.

The school offers a variety of fields in engineering organized into eight
departments:

Department of Civil Engineering −

Department of Electrical Engineering −

Electrical Energy Engineering•

Networks & Telecommunications•

6

Department of Industrial Engineering −

Department of Computer Science −

Department of Mechanical Engineering −

Department of Mineral Engineering −

Department of Modelling and Scientific Computing −

Department of Chemical and Process Engineering. −

EMI has 30 research structures including LERMA (Laboratoire d’Etudes et
Recherche en Mathématiques Appliquées) Laboratory of study and research
in applied mathematics

2.3. Laboratory of Study and Research in Applied Mathematics- LERMA

Ever since its creation, the main objective of the LERMA (Laboratory of
Studies and Research in Applied Mathematics) has been to monitor the work
of the EMI’s (Mohammadia School of Engineering) Applied Mathematics
team and to establish a link between this team and the several disciplines
using the mathematical and computer science methods.

The scientific objective of the LERMA is the development of mathematical
methodologies and tools, starting from modeling that allows placing the
studied application in an adequate mathematical framework, through the
development of algorithms and heuristics that might initiate efficient and
effective scientific software, and finally leading to the numeric calculus and
the simulation of the studied phenomena.

The aim is to achieve accessible findings that can be easily used by the industry.
This requires a strong interaction between the members of the LERMA and
the researchers in other disciplines on one hand, and the socio-professional
environment on the other. The LERMA is equipped with various scientific
competences, which promises to promote and accept multidisciplinary
research.

2.3.1. Research themes
Since 2004, the research program of the LERMA is part of the common
program of the networks in which the laboratory takes part. The main
objective of the LERMA members is to develop adequate methods for
the resolution of concrete problems. The developed research axes are
essentially:

Partial differential equations and applications −

Numerical methods and the optimization −

Risk analysis and modeling −

7

Operational research and logistics −

The targeted application domains are:

Image and medical imaging processing −

Mathematical finance −

Finance and Economic modeling −

The flow in homogeneous and heterogeneous media −

Reliability and maintenance management −

Industrial and financial risks −

Markov decision Processes (MDP) −

2.3.2. LERMA Team
The LERMA is a laboratory that consist of about fifty (50) researchers;
twenty (20) of them are professors and the other thirty (30) are doctoral
students. Some of these research professors are appointed at the EMI
(Mohammadia School of Engineering) while others work in several other
Moroccan institutions. About ten (10) of them are Assistant Professors
preparing for their post-doctoral degree (in order to oversee research in the
future).

Numerous national and international projects gather these researchers
around specific themes.

LERMA team in numbers:

20 senior researchers, members and associate members −

10 researchers preparing for “habilitation − 1”

More than 45 Ph.D. Students −

3 habilitations −

65 Ph.Ds so far −

1 Habilitation is the highest academic qualification a scholar can achieve by his or her own pursuit; it requires that the
candidate write a professorial thesis.8

2.3.3. LERMA projects and partnerships
LERMA members are members of numerous networks and international
projects, including the LIRIMA, an international laboratory for IT and applied
mathematics research, the LEM2I, the Euro-North-African laboratory for
mathematics and its interactions, and the IFE Lab.

Researchers of LERMA are working on numerous national and international
projects around specific themes, in modeling and simulation in several areas
including finance and Islamic finance.

LERMA consists of three international laboratories:

LIRIMA: an international Euro-African laboratory for IT and applied  �
mathematics research, with INRIA – France. It was created in November
2009, with the head office based in the University Yaounde I, bringing
together researchers from nine (9) countries of sub-Saharan Africa and
the Maghreb with French researchers to work on common projects,
modelled as INRIA (France) project teams.

LEM2I: ( � Laboratoire Euro-Maghrébin de Mathématiques et leurs
Intéractions) An Euro-North-African laboratory for mathematics and
its interactions at the National Center for Scientific Reseach (CNRS),
France. It was created in September 2009. It involves more than 200
researchers in applied mathematics from France, Spain, Italy, Algeria,
Morocco, and Tunisia. The aim of the LEM2I is to develop research
programs and mathematical publications in collaboration between the
partners.

It is funded by the CNRS and from each partner institution in France,  ¾
Italy, Spain, Algeria, Morocco and Tunisia.
LEM2I organizes international conferences, thematic workshops,  ¾
schools on high performance calculus and develops an exchange
program between researchers.
LEM2I is involved in the creation of the Master Méditerranéen de  ¾
Mathématiques (submitted to the Erasmus Mundus program of the
EACEA agency of the European Commission). It is also involved in
the creation of a high-level PhD training program in Mathematics for
the whole Mediterranean area. (Theses with 2 advisors on both sides,
south and north, of the Mediterranean area).

IFE Lab: Islamic Financial Engineering Lab, with IsDB. �

9

LERMA members are also part of several bilateral and international
projects:

Euro-Mediterranean projects (3 + 3): Scientific Computing and  −
Multidisciplinary Optimization “SCOMU” 2009-2013, this
project brings together researchers from (France, Italy, Morocco
and Tunisia).

Inverse problems in hydrogeology “Hydromed” 2009 - 2013 and  −
“Hydrinv” 2013 - 2015. This project brings together researchers
from Spain, France, Algeria, Morocco and Tunisia.

Team Inverse Problems in cardiac electrophysiology: «  −
EPICARD » is an associate team of the Carmen project at
INRIA, regrouping researchers from INRIA, LAMSIN – ENIT,
LERMA – EMI, Mohammed V University and from Université
Technologique de Compiègne.

The overarching goal of these laboratories and projects is to  −
develop new mathematical approaches and models for solving
different considered problems.

2.4. Islamic Development Bank (IsDB)

The Islamic Development Bank (IsDB) (Arabic:
 is a multilateral development (البنك اإلسالمي للتنمية
financing institution located in Jeddah, Saudi
Arabia. It was founded in 1973 by the Finance
Ministers at the first Organization of the Islamic
Conference (now called the Organization of Islamic
Cooperation) with the support of the late King
Faisal of Saudi Arabia, and began operating on 20
October 1975. The purpose of the Bank is to foster
the economic development and social progress of
member countries and Muslim communities individually as well as jointly in
accordance with the principles of Shari’ah i.e., Islamic Law.

The functions of the Bank are to participate in equity capital and grant loans
for productive projects and enterprises besides providing financial assistance to
its Member Countries in other forms for economic and social development. The
Bank also establishes and operates special funds for specific purposes including
a fund for assistance to Muslim communities in non-member countries, in
addition to setting up trust funds. The Bank is authorized to accept deposits
and to mobilize financial resources through Shari’ah-compatible modes. It is
also charged with the responsibility of assisting in the promotion of foreign
trade especially in capital goods, amongst Member Countries; providing

10

technical assistance to member countries; and extending training facilities for
personnel engaged in development activities in Muslim countries to conform to
the Shari’ah.

2.4.1. IsDB Vision
“To be the leader in fostering socio-economic development in member
countries and Muslim communities in non-member countries in conformity
with Sharia. “

2.4.2. IsDB Mission
“The IsDB Group is committed to alleviating poverty; promoting human
development; science and technology; Islamic economics; banking and
finance; and enhancing cooperation amongst member countries, in
collaboration with our development partners.”

2.5. The Financial Product Development Center (FPDC)

The Financial Product Development Center was
established in Muharram 1432H (December
2010). Its main purpose is to enhance the leadership
of the Islamic Development Bank Group (IDBG)
in the development and promotion of innovative
Islamic financial products within the framework
of the Maqasid al-Shari’ah, while securing and further strengthening the
financial soundness and relevance of the IsDB Group.

The Center is the focal point for the development of new and innovative
financial instruments in the IsDB Group, and for this purpose, it also
collaborates with various institutions in the Islamic financial industry.

The Center has three major strategic objectives:

Developing Business Process for new product developmenta.

Building capacity of product developersb.

Designing new financial productsc.

These three objectives are summarized by the “3Ps” that the Center works
along: Process, People, and Products.

2.5.1. Process
Formulating the Business Process (BP) of developing new products is vital to
determine the requisite steps for product development. The BP will be used
as a framework for all other activities for product development.

11

The Center has already completed the general Business Process Matrix for
IsDB Group, and is working to develop the detailed processes of each step
in the BP. The Center is also moving ahead to implement the processes. The
steps for this include:

Identifying product gaps with respect to the needs of investors a.
and customers, both on the assets side and liabilities side.

Developing tools and techniques for generating and evaluating b.
new product ideas.

Producing Manuals of Islamic Financial Productsc.

2.5.2. People
For the process to be effective there has to be a good number of product
developers who are equipped with the skills and knowledge needed for
product development. This objective is achieved mainly through:

Capacity building and training programs.a.

Establishing networks with experts in the IsDB Group and in the b.
industry, to:

Identify gaps within each department or entity.i.
Stimulate new idea generation.ii.
Share information on existing products.iii.
Coordinate product development process.iv.
Organize periodic seminars and conferences by inviting experts v.
and scholars to enrich and enhance developing new products.

2.5.3. Products
With an effective process and the right people, the stage is set for designing
new products to fill the gaps between customers’ and investors’ needs on one
hand, and the existing products on the other. Accordingly, the Center carries
out the following activities:

Carry out periodic surveys of existing Islamic and conventional a.
products.

Respond to the needs of the IsDB Group entities for new b.
products.

Work closely with the Advisory Panel and the Working Group c.
for idea generation and evaluation.

12

Collaborate with the concerned departments and entities for due d.
approval and implementation.

Arrange pilot experiments for testing new productse.

2.6. Establishment of IFE Lab

Following preliminary meetings between the Center and LERMA during the
summer of 2013, the IsDB and Mohammed V University signed an agreement
to establish the Islamic Financial Engineering (IFE) Lab in November 2013.
The Lab officially started operating by the beginning of the year 2014.

13

IFE Lab activities3.
Since its inception, the Lab has been actively working to achieve its objectives.
The tables below summarize the main activities up to date (June 2015).

3.1. Courses

Academic Year 2013/14

# Date Course Title Instructor

1
24 - 26 February

2014

NetLogo Programming
and Applications in

Finance

Professor Murat Yildizoglu,
University of Bordeaux

2 20 - 22 March 2014
Fundamentals of Islamic

Finance
Dr. Ridha Saadallah, President of the

Tunisian Association of Islamic finance

3 26 - 30 May 2014 Game Theory (Part I) Professor Mohamed Tkiouat, EMI

4 4 - 5 June 2014 Game Theory (Part II) Dr. Salman Ali Sayed, IRTI

Academic Year 2014/15

5
15 to 18 October

2014
Real Estate Finance Dr. Yildiray Yildirim, Syracuse University

6 23 November 2014 Multi-agent systems
Prof. Abderrafiaa Koukam, University of

Technology of Belfort-Montbéliard

7
26 - 28 February

2015
Economics of Sharing

Contracts

Dr. Mahmoud Sami Nabi, Head,
Economics Department at Tunisia

Polytechnic School

8
31 March and 1 April

2015
Financial transactions

jurisprudence
Dr. Mohammed Karrat

Academic Year 2015/16

# Date Course Title Instructor

9 1-3 June 2015
Hedging in Islamic

Finance
Dr. Sami Al-Suwailem, IsDB

10
18-19 September

2015
Introduction to MATLAB

Pr. Rajae Aboulaich, LERMA
&

Pr. El Mahdi El Garmah. Morrocan
Royal Air School

11 5-7 October 2015 Introduction to Sukuk
Dr. Ridhaa Saadallah, President of the
Tunisian Association of Islamic finance

12
20-22 November

2015
Real Estate and Corporate

Finance

Dr. Yildiray Yildirim,
Chair, William Newman Department of

Real Estate, Baruch College, CUNY, USA

15

3.2. Seminars

Academic Year 2013/14

# Date Seminar Title Presenter

1 10 October 2013
Agent-Based Simulation in

Islamic Finance
Dr. Sami Al Suwailem, IsDB

2 2 December 2013
Introduction to Multi-

Agent Simulation
Pr. Karim Bouzoubaa, EMI

3
13 & 24 December

2013
Introduction to Netlogo

Mohamed Amine Souissi & Wail
Aaminou, PhD Students at IFE Lab

4 6 January 2014
Complexity and

endogenous instability
Dr. Sami Al Suwailem, IsDB

5 16 January 2014
Financial transactions

jurisprudence
Dr. Mohammed Karrat

6 28 January 2014
Modeling a Logistic

platform using Netlogo
Mr. Samir Tetouani

7 4 February 2014
Macroeconomic

computable general
equilibrium models

Ms. Salima Mansouri,
Ph.D. student at IFE Lab

8 18 February 2014

Strategic behavior and
economics of climate
change: A Differential

Game Theory Approach

Pr. Hassan Benchekroun,
McGill University

9 12 May 2014

Conference: Challenges and
operational problems for

the establishment of Islamic
banks in the Moroccan

context

Dr. Ali Alami Idrissi,
Optima Finance Consulting

10 13 May 2014
Conference: Functioning of
the Moroccan stock market

Dr. Mohamed Amrani,
CEO, BMCI Asset Management

11 7 June 2014 Time Series Modeling
Pr. Youssef Benghabrit,

ENSAM Méknes

12 21 June 2014 Genetic Algorithms
Pr. Hanaa Hachimi,

ENSA Kenitra

16

Academic Year 2014/15

# Date Seminar Title Presenter

1 24 November 2014
Modeling and multi-agent

simulation in
economics and finance

Dr. Sami Al Suwailem, IsDB

2 12 March 2015
Islamic financial investment

techniques
Mr. Mohammed Wail Aaminou, Ph.D.

Student at IFE Lab

3 19 March 2015 Corporate  Valuation
Mrs. Ilham Boularhmane,
Ph.D. Student at IFE Lab

4 26 March 2015
Islamic Financing

Techniques
Mrs. Khadija El Hachami,
Ph.D. Student at IFE-Lab

5 1 April 2015
Applications of Maqasid
Shari’ah in Economics

Mr. Houssem Eddine Bedoui

6 14 April 2015
Islamic Economics and

Microfinance
Mr. Nawfal Naciri,

Ph.D. Student at IFE Lab

7 23 April 2015
Islamic Portfolio

Management
Mrs. Fatima Zohra Elihssini,

Ph.D. Student at IFE Lab

8 14 May 2015
Conference: Economic

Empowerment
Mr. Anas Hasnaoui,

Director, IBF Group Consulting

3.3. Publications

The IFE Lab students have published papers and communiques (brief reports)
about their research in various outlets. These include:

Communications
W. Aaminou and R. Aboulaich: Modeling consumer behavior, case of Islamic
finance, Published at the 10th edition of Numerical Analysis and Optimization
conference (Essaouira, Morocco) October 2013.

W. Aaminou and R. Aboulaich: Consumer behavior in Islamic Finance:
Literature review, Published at the 1st edition International Symposium on
Islamic Finance: Applications, Challenges and Prospects (Agadir, Morocco)
October 2013.

M. A. Souissi and M. Tkiouat: State of the art on Sukuk, The Numerical
Analysis and Optimization Days The 10th edition of Numerical Analysis and
Optimization conference Essaouira-Morocco (Oct. 2013).

I. Boularhmane and R. Aboulaich: Valuing Investments through Principles
of Islamic Finance: a Modeling Solution, 10th edition of Numerical Analysis
and Optimization conference Essaouira-Morocco (Oct. 2013).

17

I. Boularhmane and R. Aboulaich: Valuation model of socially responsible
companies from an Islamic point of view, 6th Islamic Banking Accounting
and Finance Conference, Nilai-Malaysia (Sept. 2014).

A. Dchieche and R. Aboulaich: « Islamic Contingent Premium Options ». Le
premier congrès international en finance éthique et islamique sous le thème:
Finances altérnatives et crise: finance éthique, responsable, participative,
islamique. 2014, October, 30-31 Cadi Ayyad University, Marrakech,
Morocco.

M. A. Souissi and M. Tkiouat: Introduction of Sukuk in Morocco, Challenges
and Risks, Le premier congrès international en finance éthique et islamique,
2014, October, 30-31 Cadi Ayyad University, Marrakech, Morocco..

F. Z. Elihssini and M. Tkiouat: Vers un MASI et un MADEX islamiques sur
la bourse de Casablanca, Le premier congrès international en finance éthique
et islamique, 2014, October, 30-31 Cadi Ayyad University, Marrakech,
Morocco.

N. Naciri and M. Tkiouat: Complex systems Overview, Second World
Conference on Complex Systems, Agadir- Morocco (Oct. 2014).

N. Yachou and R. Aboulaich: Mortgage loan in Islamic and conventional
finance, Conference on “Islamic Economy from crises to solidarity
institutions”, Beni Mellal, Morocco, 11-12 May 2015

N. Yachou and R. Aboulaich: Principle of Sharing Of Profits and Losses within
Islamic institutions, “Musharaka Contract”, 3rd International Congress of
Islamic Finance, Islamic Banks and Companies Financing: Practices and
Theoretical Challenges “ Marrakech, Morocco, 25-26 May 2015.

W. Aaminou, R. Aboulaich, Fadwa Chaker and Abdellah El Manouar:
CSR Dynamics under Peer Pressure and Green Confusion: a Multi-Agent
Simulation Approach. 10th International conference on intelligent systems:
Theories and applications (SITA), Oct 2015.

K. El Hachami and M. Tkiouat: The Agent-Based Modeling of the
Macroeconomic Behavior of Sharia-Compliant Companies; International
Congress on Islamic Economics and Finance; Sakarya-Turkey. 2015,
October.

Amina Dchieche and Rajae Aboulaich: «Pricing of Waad Bil mourabaha» au
Premier Colloque International en Finance sous le thème, Finance Islamique
modèle alternatif de développement de la finance mondiale.  2015, December
10-11, Université Ibn Tofail, ENCG Kénitra.

K. Dahani et R. Aboulaich: Modélisation macroéconomique dans le cadre
de l’économie islamique: I-DSGE, Première édition du colloque international

18

en finance, 2015, December10-11, 2015, December 10-11, Université Ibn
Tofail, ENCG Kénitra.

Amina Dchieche and Rajae Aboulaich: «Pricing of profit and loss sharing
contract new approach to model Salam» Accepted in 18th International
Conference on Information and Financial Engineering, 2016, April 25-26
World Academy of Science Engineering and Technology in Paris.

Published papers
Siham Omrana and Rajae Aboulaich: “Bai Al Arboun” A Shariah Compliant
Alternative to Conventional Call Options. International Research Journal of
Finance and Economics. ISSN 1450-2887. Issue 115 October, 2013

Nawfal Naciri and Mohamed Tkiouat: Understanding Complexity in
Economic Systems with Agent Based Modeling, International Journal of
Latest Research in Science and Technology, Volume 4, Issue 3: Page No.28-
31, May-June 2015.

Naciri Nawfal and Tkiouat Mohamed: “Complex systems: state of the art”
International Journal of Advances in Management and Economics (IJAME),
2015.

Naciri Nawfal and Tkiouat Mohamed: Multi Agent Systems: theory and
applications; survey. International Journal of Intelligent Systems Technologies
and Applications. Inderscience Publishers Ltd.

Naciri Nawfal and Tkiouat Mohamed: Agent-Based Platforms: Review
and Comparison. International Journal of Applied Engineering Research
(IJAER). Volume 10, Number 14 (2015) pp 34224-34229.

Rajae Aboulaich and Amina Dchieche: Pricing of Waad Bil Mourabaha”,
Asian journal of applied sciences, Vol 3, No 3 (2015), June 2015

Siham Omrana, Rajae Aboulaich, Ali Alami Idrissi: Modelling “Bai Al
Arboun” Using Binomial Model, International Journal of Business, 20(3),
Fall 2015.

Adil El Fakir and Mohamed Tkiouat: An Incentive Mechanism Game Theory
Approach to Musharakah Contracts, Asian journal of applied sciences, Vol
3, No 4 (2015)

Adil El Fakir and Mohamed Tkiouat: « New Projects Sharing Ratios under
Musharakah Financing: A Repeated Game Theoretical Approach Using an
Output versus a Proposed Effort Based Contract », American Journal of
Applied Sciences, 12 (9): 654.662, 2015.

Rajae Aboulaich and Amina Dchieche: “Participating Contingent Premium
Option”, Review of Pacific Basin Financial Markets and Policies, accepted

19

http://www.ajouronline.com/index.php?journal=AJAS&page=issue&op=view&path%5B%5D=133

http://www.ajouronline.com/index.php?journal=AJAS&page=issue&op=view&path%5B%5D=133

on October 2015.

Amina Dchieche and Rajae Aboulaich, “New approach to model Salam
Contract for profit and loss sharing”, International Journal of Applied

Engineering Research, accepted on November 2015.

Submitted Papers
W. Aaminou and R. Aboulaich: “Simulating consumers’ behavior in new dual
banking markets”. Review of Pacific Basin Financial Markets and Policies,
submitted in February 2015.

R. Aboulaich, S. Badraoui, K. Bensaid, A. Mouad El Haloui: Impact of
qualitative characteristics on market equilibrium; Simulation with agent-
based modeling, Review of Quantitative Finance and Accounting, submitted
in June 2015.

I. Boularhmane, R. Aboulaich: Valuation of Quarterly Stock Prices: Applying
Ethical Principles to Discounted Cash Flow Method, Research in Finance,
submitted in Research In Finance, submitted in June 2015.

3.4. Internships

As part of the IFE Lab program, students undertake brief internships at
Islamic financial institutions to enhance their research. This includes:

Wail Aaminou, Mohamed Amine Souissi – Islamic Development a.
Bank, April-May 2014

Siham Omrana, Wail Aaminou - Malaysia, June 2014b.

Ilham Boulrahmane – Malaysia and Bahrain, September - October c.
2014

Nawfal Naciri, Khalid Bensaid, Ahmed Mouad Elhaloui – d.
Islamic Development Bank, December 2014 – January 2015

20

IFE Lab Team4.
4.1. IFE Lab Advisory Committee

The Advisory Committee oversees the plans and objectives of the Lab. It is
composed of the following scholars.

From LERMA:

Dr. Rajae Aboulaich �

Dr. M. Tkiouat �

From IsDB:

Dr. Ridha Saadallah �

Dr. Salman Syed Ali �

Dr. Sami Al-Suwailem �

4.1.1. Dr. Rajae Aboulaich
Dr. Rajae Aboulaich is a professor at EMI
(Mohammadia School of Engineering) Her research is
focused on “Partial Differential Equations: Analysis,
Resolution and Applications, Optimization.” The
application of her research is Fluid mechanics, Image
processing, Biomathematics, Finance, etc.

Ph.D. in Mathematics and Numerical Analysis,  �
University of Laval, Canada

Master & Ph.D. in Analysis and Probability, Muhammad V  �
University, Rabat

Associate Director, LIRIMA – 2009 – present �

Head of LERMA, 1991 – present �

4.1.2. Dr. Mohamed Tkiouat
Dr Mohamed Tkiouat is a professor at EMI
(Mohammadia School of Engineering)

Ph.D. in Mathematical Sciences in the field of  �
Markov decision processes and applications
at the Université libre de Bruxelles. Mention:
Summa cum Laude, 1991

Ph.D. in Mathematics, Faculty of Sciences  �
Rabat. Mention: Laude, 1984

21

4.1.3. Dr. Sami Ibrahim Al-Suwailem
Dr. Al-Suwailem is currently Head of Financial Product
Development Centre at the Islamic Development
Bank. He was previously Deputy Director of Islamic
Research and Training Institute at the IDB Group.
Before joining IRTI in 2004, Dr. Al-Suwailem managed
the Research and Development Center of the Shari’ah
Group at Al-Rajhi Bank, Riyadh, Saudi Arabia. He
worked at Institute of Islamic and Arabic Sciences in
America, Virginia, Southern Illinois University, Carbondale, Illinois, USA,
and King Saud University, Riyadh.

He authored many books and published several papers on Islamic economics
and finance. Dr. Al-Suwailem held membership in several professional
committees, including the Technical Committee of the Islamic Financial
Services Board; Economic Committee of Awqaf at the Ministry of Islamic
Affairs in Riyadh; Academic Committee in Islamic Fiqh Academy of Muslim
World League; Executive Committee of the Islamic International Foundation
for Economics and Finance; Liquidity Risk Management Working Group for
IFSB; and Task Force for Islamic Finance and Global Financial Stability.

He obtained his M.A from Southern Illinois University in 1990, and his
Ph.D. from Washington University, St. Louis, Missouri, in 1995.

4.1.4. Dr. Ridha Saadallah
A member of IRTI Board of Trustees.

Doctorat d’Etat in Economics - Tunis  �
University, 1980

With Distinction and Highly Commended
(Mention Très honorable avec les félicitations
du jury)

Diplôme de Statisticien Economiste (Postgraduate degree in Statistics  �
and Economics)

National School of Statistics and Economic Administration (French
Grande Ecole). Paris, 1973

D.E.S in Econometrics (Master Degree) �

University of Paris I, 1972

B.A. in Economics (Licence es Sciences Economiques) - Distinction �

Tunis University, 1970

22

4.1.5. Dr. Salman Syed Ali
Dr Salman Syed Ali is a senior economist at IRTI
(Islamic Research and Training Institute), IsDB
Group.

Ph.D. in Economics, University of Pennsylvania,  �
U.S.A., 1995

B.Sc. (Hons.) & M.Sc. in Economics,  �
International Islamic University, Islamabad,
Pakistan

Editor of Journal: Islamic Economics Studies �

Served as Director of Research and Training, International Institute  �
of Islamic Economics (IIIE), Pakistan.

4.2. Executive Committee of IFE Lab

The Executive Committee is responsible for implementation of the IFE Lab’s
plans and programs and oversees its daily activities. It is composed of:

Prof. Rajae Aboulaich, Director of IFE Lab. and LERMA, EMI, e.
Mohammed V University

Prof. Mr. Tkiouat, LERMA. Member of the IFE Lab. and f.
LERMA, EMI, Mohammed V University

4.3. IFE Lab IsDB Coordinator

From IsDB, Br. Houssem Bedoui is the focal point for
coordinating the activities of the IFE Lab with IsDB.

Br. Houssem is a financial engineer and Product
Development Specialist in Islamic Development Bank.
He is a Ph.D. student at the ENS (Ecole Normale
Superieure, France). He develops scientific work on
Islamic Finance. Before joining IsDB, he had a career
as a consultant in management advisory and ethical/sustainable finance. He
has worked with different think tanks to develop Islamic Finance in France.
As a part of FPDC, he is contributing to innovative products, and creating
processes to develop new financial products. He manages the IFE lab as part
of his target to work on People as a main component of financial innovation
and product development.

23

4.4. IFE Lab Professors

The Lab collaborates with a large network of highly qualified and
internationally recognized professors in various fields related to its area.

4.4.1. EMI Professors

Dr. Mohammed Ryada.

Dr Mohammed Ryad is an Economist at the EMI
(Mohammadia School of Engineering). He holds a
Ph.D. in Economics (Option: economic strategies
and economy companies) from the Faculty of Social
Sciences, Law and Economics, Rabat. His area is on
economics (macro and microeconomics).

Dr. Rachid Ellaiab.

Dr Rachid Ellaia is a professor at the EMI in Applied
Mathematics. He has published papers in the field of
optimization, probability transformation etc.

4.4.2. External professors

Dr. Murat Yildizoglua.

Professor of Economics, Bordeaux University �

Member of GREThA (UMR 5113) �

Associate member of BETA (UMR 7522 du  �
CNRS), Université Louis Pasteur de Strasbourg.

Previous Positions:

2008-2011: Professor, Aix Marseille University,
GREQAM (UMR CNRS 6579)

2000-2008: Professor, Bordeaux University, GREThA (UMR CNRS 5113)

1992-2000: Assistant profesor, Strasbourg University, BETA (UMR CNRS
7522)

1989-1992: IEP Strasbourg, Ph.D. student and teaching assistant (ALER)

Research interests: Industry Dynamics, Economics of Innovation, Economic
24

Growth, Learning, Industrial Organization, Computational economics,
Agent Based Models, Evolutionary modelling.

Technical competencies: Microeconomic modelling, Game theory,
Computational economics, Agent based evolutionary modelling, Genetic
Algorithms, Classifier systems, Artificial neural networks, Basic econometric
modelling.

 Dr. Yildiray Yildirimb.

William Newman Real Estate Chair, Professor �

Chair, William Newman Department of Real  �
Estate

Director, Steven L. Newman Real Estate Institute �

Ph.D., Cornell University �

His main research interests are in real estate, in
particular securitization and commercial leasing,
credit risk, fixed income securities, inflation modeling, and structured finance.
He was a visiting scholar at Princeton University, Office of Comptroller of
the Currency, and Borsa Istanbul. He has provided consultancy at the U.S.
Department of Housing regarding issues concerning multi-family mortgage
default and foreclosure, and most recently received a grant from JP Morgan
Chase on commercial mortgage origination and tenant risk. He developed
the undergraduate real estate program at Syracuse University in 2009. He
has taught finance and real estate courses, including real estate finance and
investment, real estate capital markets, case studies in real estate investment,
fixed income securities, and corporate finance. He graduated from Yildiz
Technical University with a B.Sc. in Computer Science and Engineering.
He received both his M.A. in Economics and Ph.D. in Statistics at Cornell
University.

 Dr. Abderrafia Koukamc.

Pr. Dr. Abderrafia Koukam is a Professor at the
“Université de Technologie de Belfort-Montbéliard”
(UTBM). He obtained his doctorate at the “Université
de Nancy 1” and his Research Direction Habilitation
at the “Université de Bourgogne”. He was Director
of the “Laboratoire Systèmes et Transports”, Vice
President of the Scientific Council of UTBM, Director
of Computer Science Department and the founder
of the team Multi-agent Systems and Optimization. His research focuses
on multi-agent systems: modeling, simulation, verification. He assumed the
coordination of two European projects (TRASCOM 2002-2004, SURE

25

2003-2005), several national projects (CRISTAL, ANR SafePlatoon,...),
and contracts with industry in the areas of transportation planning, mobile
networks, traffic flow simulation in industrial sites, and intelligent vehicle.

Research activities:

The Multi-agent Group is involved in the following research activities:

Agent-based Simulation −

Agent Software Engineering −

Agent Architecture −

Platooning −

Cooperative Design Process and Knowledge Management −

Optimization −

Dr. Cars Hommesd.

Professor of Economic Dynamics, University of  �
Amsterdam

Director Center for Nonlinear Dynamics in  �
Economics and Finance (CeNDEF)

Institute New Economic Thinking, member of task  �
force for systemic risk and Agent-based Modeling,
led by Nobel laureate Joseph Stiglitz

Visiting Professor, Department of Economics, University Wisconsin,  �
USA

Ph.D. in Mathematical Economics, University of Groningen (1991) �

Dr. Cars Hommes is one of the pioneers in complexity economics. His
work develops an alternative complexity paradigm based on agent-based
behavioral complexity models.

The Center for Nonlinear Dynamics in Economics and Finance (CeNDEF),
which he founded in 1998, is a multi-disciplinary research center in
complexity economics. CeNDEF has not only developed an alternative
theory of complex economic systems, but has also tested this alternative
paradigm successfully in laboratory experiments with human subjects and
estimated complexity models using financial and macroeconomic datasets.

Dr. Cars has published more than 100 articles in leading international
journals and book chapters and has authored and edited four books.

26

Dr. Francisco Doriae.

Francisco Antonio Doria was born in Rio (Brazil)
in 1945. Received a B.Sc. in chemical engineering
from the Federal University at Rio in 1968 and a
Ph.D.  in mathematical physics in 1977 (Brazilian
Center for Research in Physics) under the guidance
of Leopoldo Nachbin. Published around 80 papers
on theoretical physics, foundations of physics and of
the mathematical sciences. Proved that chaos theory,
if axiomatized, is undecidable and Gödel incomplete, and (with N. C. A. da
Costa and M. Tsuji) proved that Nash games are similarly undecidable and
incomplete.

Dr. Isabelle Sallef.

Isabelle L. Salle obtained her Ph.D. from the University
of Bordeaux (France) in 2012 on “Learning,
heterogeneity and monetary policy: an application
to inflation targeting regimes”. She then worked as a
Junior Economist at the research department of the
International Labor Office, a UN agency based in
Geneva, and joined the University of Amsterdam in
September 2013 as a post-doc researcher to work on
several European projects. Her research interests include (macro) economics,
with an emphasis on behavioral and experimental approaches, and agent-
based modelling.

 Dr. Mahmoud Sami Nabig.

Dr. Mahmoud Sami NABI is an Associate Professor of
Economics and Head of the Economics Department at
Tunisia Polytechnic School (TPS).

He occupied the position of Senior Research Economist
at the Research Division of IRTI (Institute of the
Islamic Development Bank) from 2011 to 2013 and
served as Vice-Director of the Sousse Business School
from 2008 to 2011.

Dr. Nabi holds an Engineering Diploma from TPS, and a Ph.D. in Economics
from University of Paris I- Pantheon Sorbonne. Thesis title: “Economic
Development, Banking Intermediation and Crises: Theoretical Essays”.
Mention: Highest distinction.

27

 Dr. Mahmoud Bekrih.

Dr. Mahmoud Bekri received his doctorate degree in
Quantitative Finance and Economics from Karlsruhe
Institute of Technology (KIT) in Germany at 2014. He
also received his diploma in Physics from the same
university in 2011. Dr. Bekri collaborates to develop
scientific work on Islamic Finance. He is also an
instructor and a supervisor of different theses on the
same topic. In addition, he provides consulting services
to develop Islamic Finance business activities for international banks and
asset management companies and delivers courses on advanced financial
engineering.

 Dr. Mohammed Karrati.

Dr. Mohammed Karrat studied Shari’ah from Al-
Azhar University in Egypt. Dr Karrat holds a Ph.D.
from the Faculty of Sharia (Fes) at Al Quarawyyine
and is currently a Professor of Islamic Jurisprudence
and its foundations at the same university as well as a
Partner at Al Maali Islamic Finance Consulting.

Before joining Al Maali, Dr Mohamed held several
senior academic and research positions in Islamic jurisprudence in Awqaf
(endowments) Ministry of the UAE before joining the Fatwa Committee
in Abu Dhabi where he was in charge of Islamic financial and commercial
transactions. Dr Mohammed was also involved in the preparation of the UAE
legal framework for Waqf, Waqf product structuring for the Waqf ministry,
Sukuk research for the National Sukuks Company in UAE. Dr. Mohammed
Karrat is certified as an Arbitrator for Islamic Finance from the International
Islamic Centre for Reconciliation and Arbitration (IICRA). He is also a
trainer of “Certified Islamic Banker” which is a certificate programme of
CIBAFI. Dr. Karrat also serves on the Shari’ah Board member of a number
of investment funds.

Dr. Ali Alami Idrissij.

Dr. Ali Alami Idrissi is a director and co-founder of
Optima Finance. Till 2005, He was the Chief Risk
Officer of Caisse de Depot et de Gestion (CDG),
Rabat, in charge of the evaluation and monitoring
of risks (activities of the Trading Room, Operational
Risk and ALM)

Ph.D. in Econometrics of Finance from the  �

28

University Paris IX-Dauphine, Paris, France, 1999

Masters in Markets and Financial Intermediaries, University Toulouse  �
I, France, 1993

Masters in Econometrics and Mathematical Economics, University  �
Toulouse I, France, 1992

 Dr. Mohamed Amranik.

Dr. Mohamed Amrani is the CEO of a BNP Paribas
Investment Partner, BMCI Asset Management
(Banque Marocaine du Commerce et de l’Industrie)
since 2008. He is member of the Board of Casablanca
Stock Exchange. He is a Ph.D. holder in Applied
Mathematics from University of Lorraine (France).

 Dr. Sami Assoulaimanil.

Dr Sami Assoulaimani is a co-founder of Finéopolis.
Before founding Finéopolis Consulting, Sami launched
and led the African office of a specialized international
consulting firm and participated in the development
of its international strategy. He has consulted for
various national and international projects for Islamic
financial product development missions, Shariah
governance, structured financing and design of
development strategies. He is a Ph.D. holder in Game Theory (multi-agent
decision) from the University of Brest.

29

4.5. IFE Lab Students

Aaminou Wail1.

Thesis aims at modeling the consumer behavior and its •
impacts on banks when the consumer is faced by Islamic and
conventional banking choices.

Bensaid Khalid 2.

Takaful: The Islamic way of insurance: Investors’ behavior: •
Simulation, study and analysis

30

Boularhmane Ilham3.

Asset pricing model of Stocks applying Islamic Values•

Dahani Khawla4.

Building an agent-based model of Islamic monetary •
macroeconomics

Dchieche Amina5.

Islamic Derivatives and hedging contracts•

El Hachami Khadija6.

The effect of the introduction of Islamic financial products •
in the overall balance of the Moroccan economy using the
Calculable General Equilibrium Models.

El Haloui Ahmed Mouad7.

Private Equity in Islamic Finance environment: Allocation •
models of Private Equity funds and Investors’ behavior

Fatima Zohra EL IHSSINI8.

Due to the absence of any Islamic Index on the Casablanca •
stock market, she decided to work on this market to construct
an Islamic MASI and MADEX.

Fquihi Kaoutar9.

Modeling financial stability in the context of a dual banking •
system: the case of a new introduction of Islamic banking.

Naciri Nawfal10.

Islamic microfinance and ABS•

Omrana Siham11.

Modeling “Bai Al Arboun“ as a Shariah Compliant Alternative •
to Call Option

Souissi Mohamed Amine12.

Quantitative study of sukuk market in Morocco•

Yachou Najlae13.

Substitute the mortgage by the Musharakah contract•

31

Admission to IFE Lab5.
For admission to the IFE Lab, candidates have to fulfill the requirements of
both the Moroccan Centre for Doctoral Studies (CEDOC) as well as the IFE
Lab.

Requirements of CEDOC 1.

CEDOC manages doctoral training and postgraduates in Morocco.

Access to Ph.D. is open to holders of Master degrees, specialists
or Master graduates of Engineers (Bac + 5). The duration of the
preparation of Ph.D. is three years. An additional year may be granted,
as required by the Director of the school. An additional second year
may be granted as an exception.

Requirements of IFE Lab 2.

Letters of recommendation from professors of candidates;  −

Good level in English; −

Age at time of registration should not exceed thirty (30); −

Signed Letter of Commitment from the candidate committing  −
to attend all classes, seminars and internships arranged by the
IFE Lab.

Obtaining a Ph.D. is conditional upon:

Validating all trainings programmed by CEDOC and IFE  −
LAB;

Publication of the results of the scientific work of the Ph.D.  −
student as Lead Author in indexed journals (SCOPUS or
more);

Participation in conferences; −

Public defense of the research work in front of a jury of experts  −
in the field.

Conditions to defend the thesis:3.

To defend his/her thesis, a student should have two requirements:

two papers indexed in SCOPUS −

an ABS model for the simulation of a problem in Islamic finance  −
or Islamic economics.

32

Award for Best Application of ABS in Islamic Finance6.
In 2014, the Advisory Committee of the IFE Lab decided to launch a
competition to award the Best Application of ABS in Islamic Finance to reach
out to graduate students worldwide who are eager to learn new techniques
and use these techniques to contribute to the advancement of Islamic
economics and finance. The award encourages students to learn and apply
these new tools in this field. Such efforts would greatly expand the scope of
research in this area, and, more importantly, encourage a more systematic
approach to Islamic financial engineering and product innovation.

The Award prizes are supported by the SABIC Chair of Islamic Financial
Markets Studies from the Imam Muhammad bin Saud University, Riyadh.

Timeline

Deadline for Submission of Paper and Codes   - 20th October 2015

Announcement of Winners   -  January 2016

Award Ceremony   - 18th February 2016

Prizes

1) Cash Prize

 1st Place  - USD 8,000/-

 2nd Place  - USD 6,000/-

 3rd Place  - USD 4,000/-

2) Commemorative Medal

3) Certificate of Honor

For more details, www.facebook.com/absinif

33

www.facebook.com/absinif

In the media7.

Sunday, 01 February 2015 - Jeddah, KSA - The Islamic Development Bank
(IDB), SABIC Chair of Islamic Financial Markets Studies, and Islamic
Financial Engineering Lab at Mohamed V University, Morocco, have
joined hands to present the first Award for Best Application of Agent-based
Simulation (ABS) in Islamic Finance.

The Award is aimed at inspiring student researchers across the world to
use and apply Agent-based Simulation (ABS) to various aspects of Islamic
economics and finance. ABS is a valuable tool for studying complex
phenomena and developing practical solutions. Platforms such as ABS can
prove to be effective in understanding multi-agent behavior in complex
systems. Over the past 25 years, ABS has been increasingly applied in a
variety of fields of knowledge such as science, finance among others.

The Award offers three prizes to the best three winners: first place: $8,000;
second place: $6,000; third place: $4,000. Deadline for submission is 30
September 2015.

The Award is in line with the mandate of IDB of promoting Islamic finance
by developing innovative Islamic financial products and instruments that
support economic growth and development of Member Countries and
Islamic financial institutions.

Click here for a detailed Brochure of the Award.

© Islamic Development Bank - 1436H/2015G

35

Feb 19 Researchers are seeking to apply the principles of game theory to
Islamic finance, one of several efforts to shed new light on economic
behaviour in an industry driven by religious principles.

Traditionally, research into Islamic finance has focused on what is religiously
permissible - whether activities and instruments follow sharia law, such as
bans on interest payments and pure monetary speculation.

But as the industry grows, attention is shifting to include practical matters
such as how investors and fund-raising institutions make decisions, and how
to design economically viable new products.

The shift comes as Islamic banks try to expand beyond a relatively small
client base that focuses on sharia compliance, to a much larger one whose
financial decisions are based on a wide range of factors such as pricing and
service quality.

A competition launched this month by the Islamic Development Bank (IDB),
in partnership with universities in Morocco and Saudi Arabia, invites entrants
worldwide to submit computer models of some aspect of Islamic economics
or finance. Cash prizes are offered for the best three submissions.

Models are to employ agent-based simulation (ABS), which uses individual
rules for the behaviour of each participant and shows how their interaction
can have results that no participant intended.

Sami Al Suwailem, head of the financial product development centre at the
Jeddah-based IDB, said he hoped the models would reveal how various agents
in Islamic finance - such as customers, banks and regulators - responded to
each other.

“There is a disconnect now between theory and practice in Islamic finance.
Not surprisingly, there is little innovation in the industry,” he said. “ABS is
one way, among many, to help bridge this gap and to spur innovation.”

PRODUCT DESIGN

Conventional finance has used mathematical models and massive computing
36

power for decades. Islamic finance now seems to be reaching a size and
complexity that make it worth doing the same; the industry’s global assets
are estimated to exceed $2 trillion and are growing faster than conventional
finance.

In 2013, the IDB set up an Islamic financial engineering laboratory at
Morocco’s Mohamed V University, which launched the ABS research
competition with Saudi Arabia’s Imam Mohammed Bin Saud Islamic
University.

ABS could help estimate the impact of introducing new Islamic financial
products to the market, said Mohammad Al Suhaibani, professor of
economics at the Saudi university.

“The research in this topic is very important to improve our understanding
of Muslim economic behavior. We are confident that this award will open a
new chapter in Islamic finance and economics research.”

Many new research efforts are backed by partnerships between financial
institutions - either multilateral institutions such as the IDB, or commercial
banks - and universities.

In November, Malaysia’s CIMB Islamic Bank and the International Centre
for Education in Islamic Finance (INCEIF) in Kuala Lumpur set up a research
centre that focuses on product development.

Islamic financial research is evolving from a focus on theoretical concepts in
the 1980s and the regulatory environment in the 1990s to operational issues
such as product design and cross-border deals, INCEIF said in a statement
to Reuters.

“There is a real need to bridge the gap between academic knowledge and
industry experience,” it said, adding that this was becoming possible because
more historical data had been made available in recent years, allowing more
empirical studies to be conducted.

Meanwhile, the World Bank and the Bahrain-based Al Baraka Banking
Group have tied up to develop a series of research projects studying the
legal and regulatory environment needed for equity-based Islamic finance
contracts.

The first initiative will study the risk-management challenges facing Islamic
banks, with a focus on profit-sharing contracts known as musharaka and
mudaraba, which are widely known conceptually but little used in practice.
Preliminary findings of that project are expected to be available in the first
quarter of this year.

(Editing by Andrew Torchia)

37

For any queries, please contact:

Financial Product Development Center

Islamic Development Bank

19th Floor, HQ Building

P.O. Box 5925, Jeddah 21432

Kingdom of Saudi Arabia

Email: fpdc@isdb.org

Tel: +966 12 646 7469

Fax: +966 12 636 7554

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January 9, 2010
DR. ZULKIFLI HASAN
Another hurdle to Islamic Finance in India
Court stays Kerala’s Islamic banking plans

Available at:
http://economictimes.indiatimes.com/news/politics/nation/Court-stays-Keralas-Islamic-banking-plans/articleshow/5414884.cms
KOCHI | NEW DELHI: A division bench of the Kerala High Court on Tuesday stayed all further move by the state-owned Kerala State Industrial Development Corporation (KSIDC) to set up an Islamic bank in the state. The division bench gave its orders on a petition filed by former central minister Subramanian Swamy, who maintained that the proposed bank was against India’s secular credentials and its banking norms. The court accepted the petition and issued notices to the Union government and KSIDC.
The Kerala government gave the green signal to the project after a feasibility study found that an Islamic bank was a viable proposition in Kerala, following which a company was registered to take the process forward. Kerala’s finance minister Thomas Issac had recently told the state assembly that the share capital of the bank had been fixed at Rs 1,000 crore.
According to the proposal, the bank will not pay any interest to customers, while a Sharia board would decide what sort of investments it would make. The proposed bank would have Sharia-compliant banking products and profits made out of the investments would be distributed to the shareholders. Muslims comprise 24% of the state’s 3.2-crore population.
In his PIL, Mr Swamy had contended that public money was being appropriated for favouring a particular religion in a secular country, as KSIDC has 11% stake in the multi-crore bank. “The government’s participation is clear instance of state favouring a particular religion. This is violative of Article 14 and 25 of Constitution which promises equality before law and right to freedom of religion. Besides, Islamic Bank is violative of Banking Regulation Act of 1949. A 7-judge bench of the SC had ordered that no public money should be used for promoting institutions of a particular religion,” the PIL contended.
“The whole history of the world is summed up in the fact that, when nations are strong, they are not always just, and when they wish to be just, they are no longer strong.” Winston Churchill
Warm Regards

ZULKIFLI HASAN

DURHAM, UK
University of Glasgow, Scotland.
Islamic finance news
1 Comment
January 7, 2010
DR. ZULKIFLI HASAN
Regulatory hurdles for facilitation of Islamic financial products in South Korea
Regulatory hurdles for facilitation of Islamic financial products in S. Korea

Mushtak Parker. Available at:
http://www.arabnews.com/?page=6&section=0&article=130672&d=4&m=1&y=2010
DESPITE the postponement by South Korea’s National Assembly’s Strategy and Finance Committee of pushing through a vote to approve a bill aimed at facilitating tax neutrality for the issuance of sukuk at end December 2009, local supporters of the introduction of Islamic finance products are confident that the delay is a minor setback.
They stress that the postponement was more due to the timing of the vote which comes amid increasing political squabbling between the Grand National Party and Democratic Party, especially over controversial policy issues relating to the introduction of tough new income and corporation taxes which have been opposed by trade union leaders. Bankers in Korea stress that the vote stands a better chance of taking place in February 2010 when Parliament reconvenes.
The bill is a prerequisite to the launch of Islamic finance products such as sukuk, Ijara (leasing) and other products in Korea. According to Lee Do Heon, managing director, Global Business Department, Korea Investment & Securities Co. Ltd., the current regulatory hurdles which prevent the facilitation of Islamic financial products in Korea are typical of those in conventional financial markets. “The main hurdles,” he explained, “are taxation issues relating to double stamp duty, value added tax (VAT) and capital gains; and the definition of what constitutes a security. From a conventional point of view, sukuk for instance, may look like asset-backed securities or like investment certificates. There must be a standard guideline that sukuk is considered as securities. There are also other challenges on the commercial banking side. In a conventional mortgage, for instance, it is like lending with collateral. But in the Islamic mortgage of Diminishing Musharaka the bank must purchase the property and co-owns the asset or property with the mortgagee. The bank then rents out its share of the equity to the mortgagee. Under Korean legislation, commercial banks are not allowed to buy properties for purposes other than headquarters and branches etc. Fortunately, these issues have been recognized by the Financial Supervisory Service of Korea and the central bank.”
Korea is a relatively latecomer to Islamic finance in East Asia. But following the stated ambitions of neighboring countries such as Hong Kong, Singapore that are trying to establish themselves as international Islamic capital markets hubs, Seoul is similarly trying to promote Korea as a future Islamic finance hub. Kim Jong Chang, governor of the Financial Supervisory Service of Korea, the financial services regulator, believes that Islamic finance is a good innovation in the global financial market and has stressed that the Korean government is committed to facilitating it in Korea. Korea believes that the global financial crisis has shown that financial services cannot be divorced from the real economy and sees an ideal fit between its vast industrial base and Islamic finance.
Indeed, in late November 2009 the Korea Exchange (KRX) and Bursa Malaysia hosted the inaugural KRX-Bursa Malaysia Islamic Capital Market Conference in Seoul which was widely attended by local investment bankers, advisers, issuers and institutional investors and by visiting delegates of the MIFC initiative, which comprised senior management of Bank Negara Malaysia, the central bank; Securities Commission Malaysia and Bursa Malaysia.
The conference indeed was co-organized in support of the Malaysia International Islamic Financial Centre (MIFC) initiative, which aims to share Malaysia’s Islamic finance experience and to promote the opportunities in the Malaysian Islamic capital market landscape.
Malaysia acknowledges Korea as a potential Islamic financial market and welcomes Korea’s participation in shaping the Islamic finance landscape together, via leveraging on Malaysia’s more than 30 years of experience in developing the world’s most comprehensive Islamic financial system.
Dato’ Yusli Mohamed Yusoff, chief executive officer of Bursa Malaysia Berhad, is confident that “the conference will stimulate interest in the Shariah-compliant products which are currently in demand from investors who are seeking returns from alternative and ethical investments. In addition, this visit by the delegates from the MIFC will pave the way for more opportunities to exchange ideas in Islamic finance and forge greater working relations between Korea and Malaysia for the interest of growing this important industry. We are confident that the Malaysian and Korean authorities as well as KRX and Bursa Malaysia would be able to leverage on our respective strengths in the establishment of an Islamic capital market in Korea.”
Discussion centered around the liberalization of Islamic financial markets, investment and business opportunities in Islamic capital market, the Islamic finance landscape and framework as well as the growth of Islamic finance products in Asia and globally.
“The Korean sovereign wants to issue a sukuk and the country’s corporates are already preparing. What we offer is a platform for Korean issuers to issue non-ringgit sukuk in Malaysia. But we want those issuers to be able to issue in Malaysia and Korea,” said Raja Teh Maimunah, global head of Islamic markets at Bursa Malaysia.
One of the most important challenges, according to Lee Do Heon, is awareness and trying to help Korean customers understand what the principles of Islamic finance are. For example, in the case of sukuk of which most of the standard structures is an Ijara, the initial paper should be a solid one backed by underlying core assets. From a Korean issuers’ point of view it looks as if it is an accumulation because they are selling core assets. “We are trying to convince them that it is not. Also for Shariah equity funds we try to explain to them that it is more like a socially responsible investment with lower leveraging. So what we are trying to do is to explain the Shariah financial principles but in terms of a Korean and conventional financial nomenclature. We are also promoting real transactions which are acceptable to both Islamic investors and Korean customers. There are still some regulatory hurdles in Korea, so it will take a little bit more time to close Shariah-compliant transactions,” he added.
While the complexity of the issues may have been cited as a potential cause of a drag in passing the legislation, local bankers stress that they are far less complex than the conventional derivatives and bubbles that have bedeviled the global financial system over the last two years.
On the other hand, potential Korean issuers like some others in East Asia may be waiting for the sukuk market to recover in terms of pricing and yields before they decide to take the plunge. There is evidence that this is already happening both in the Asian sukuk and GCC sukuk markets. The recent $850 million IDB sukuk and the $1.5 billion Petronas EMAS sukuk were both competitively priced and were much in demand by Asian investors, and were not surprisingly well oversubscribed.
It will be interesting to see what the tax implications are in the proposed Korean sukuk bill. It is likely that the government will opt for sukuk to be sold through SPVs (special purpose vehicles) but it will have to plug a potential tax loophole or abuse of the proposed law in the case of companies with no intention of selling sukuk setting up SPVs to take advantage of the low or non-existent capital gains tax. It is likely that the bill will only allow sukuk Al-Ijarah and Mudarabah structures.
Several Korean companies including GS Caltex, Korean Air, Hyundai, Samsung and others are reportedly exploring the possibility of raising funds from the sukuk market. South Korean Chaebols including Lucky Goldstar, Samsung, Korea Shipping and several others have in the past accessed Islamic commodity Murabaha facilities structured through London.
“I have often thought that nothing would do more extensive good at small expense than the establishment of a small circulating library in every county, to consist of a few well-chosen books, to be lent to the people of the country”. Thomas Jefferson
Best Regards

ZULKIFLI HASAN

DURHAM, UK
Milan, Italy
Islamic finance news
Leave a comment
January 6, 2010
DR. ZULKIFLI HASAN
Of God’s many names and the use of ‘Allah’
Of God’s many names and the use of ‘Allah’ By Mohammad Hashim Kamali
Of the 99 beautiful names of God (al-asma’ al-husna), three, namely “Allah”, “al-Rahman” and “al-Rahim”, are most favoured. This is known by all 114 suras of the Quran, except for one, beginning with the typical Islamic phrase, the tasmiyah: Bismillah al-Rahman al-Rahim (“In the name of God, the most compassionate, the most merciful”), a phrase that includes all the three chosen names of God.
Similarly, every Quranic recitation in the five daily prayers begins with the tasmiyah. Of the three names, God has chosen only two, that is, “Allah” and “al-Rahman”, by which He may be called.The reason for the exclusion of “al-Rahim” is probably due to its repetition of the meaning of “al-Rahman”. They obtain from the same root, rahima (to be kind, compassionate).
It is reported that the second caliph of Islam, Umar ibn al-Khattab, explained this repetition by saying that “al-Rahman” is meant for Muslims and “al-Rahim” for the rest of mankind. This understanding endorses the principle that God is universal, omniscient and omnipresent. He is the creator and cherisher of all without exception.
“Allah” is the Arabic equivalent of “God”, and the two words have been used synonymously by all people throughout the history of religion. God has made Himself known to Muslims by His 99 illustrious names, which consist of His attributes that occur throughout the Quran. The self of God is not known to us; we only know Him by these names and attributes — such as Ghafoor (forgiving), Wadood (loving), Kareem (noble), Lateef (gracious) and Haleem (perseverant, patient).
When read together, they also set the ethico-cultural optima that Muslims should emulate and manifest in their conduct within the family, in society, and at all times. Belief in one God, or monotheism, is the central theme of the Islamic principle of tawhid, the oneness of being, which means that there is only one God and essentially also one humanity.
Tawhid permeates every aspect of Islam, in that the presence of God in the universe is the connecting force that binds the whole of the created universe into coherent parts. Tawhid also implies unity of the human origin in one and the same creator, an article of the Islamic faith implying an innate sense of belonging for all members of the human fraternity.
God, therefore, belongs to the whole of humanity and no sect or section of humanity may deny this sacred link to anyone. God created Adam and breathed into him of His own spirit and then created from it its pair, and from them a multitude of humans that scatter on the face of the earth. Those who believe in God are repeatedly asked in the Quran to remember Him often and nurture God-consciousness into themselves through zikir (remembrance), whenever they can.
It should be obvious, then, that in reference to all monotheists, there is no restriction whatsoever regarding the use of the word “Allah” when mentioning Him partakes in the spirit of remembrance, invocation and doa. This is the basic position of Islam.
However, when Allah is mentioned in a context that amounts to distortion and abuse, if the usage is clear in its abusive import and wording, it may amount to blasphemy, which is an offence. In the event of more subtle varieties of misuse, that is, when a good use is intended to obtain a bad result, the position may be ascertained under the principle of sadd al-dharai or blocking the (lawful) means for obtaining an unlawful end.
For instance, commerce is lawful by itself but when it is used as a means of usury (riba) or of hoarding and profiteering that inflict harm and distort the normal flow of trade in the marketplace, then the means towards such ends should be blocked. This can also be said of marriage, which is lawful, but if someone enters into it for quick gratification, to be followed by an abusive divorce, the marriage in question is unlawful, and the authorities are within their rights to prevent it.
This may also be said of the use of “Allah” if the purpose is to convert unsuspecting Muslims, as occurred in some parts of Indonesia, whereby a specious parallel is drawn by Christian missionaries between Islam and Christianity in order to entice Muslims to embrace Christianity. It is a question to some extent of differentiation between the upright and the deceitful propagation of a doctrine. If there are equivalent words, such as “Tuhan”, but “Allah” is used instead for purposes of proselytisation, then it could well amount to distortion of the kind that violates the sensitivities of the Muslim community as well as taking advantage of the ignorance of its targets.
If Christianity does not accept Islam as a valid religion to begin with, then for Christian missionaries to select only the word “Allah” out of Islam for purposes of proselytisation is tantamount to a misapplication of the term. Had they recognised Islam as a valid religion, the issue might have begged a different answer. Moreover, the Christian doctrine of Trinity is also founded in an understanding of God that cannot claim acceptance in the Islamic doctrine of tawhid.
Allah’s illustrious name may thus be used by all monotheists, Muslims or non-Muslims, for its intended purpose, but if it is used in a way that amounts to distortion and abuse, be it by a Muslim or non-Muslim, it should be obstructed by recourse to the principle of sadd al-dharai. This principle should not be too liberally applied, however, and confined only to manifest instances of abuse.
The above article was published in New Straits Times on Tuesday, March 10, 2009.
Seek the Pleasure of Allah in whatever you do, Me
Best Regards

ZULKIFLI HASAN

DURHAM, UK
Madrid, Espania
Muslims News
Leave a comment
January 4, 2010
DR. ZULKIFLI HASAN
Another Reminder to Islamic Finance
Have we learned nothing? Here come the “Islamic Credit Default Swaps”

Available at:
http://elgamal.blogspot.com/2010/01/have-we-learned-nothing-here-come.html
In a recent article, it is reported that the end of the year 2009 was punctuated with 10 defaults on “Islamic Sukuk” (otherwise known as poorly designed bonds), and then suggested that the “experts” want Credit Default Swaps to protect investors against the risk of default on Sukuk!! Here’s a translated excerpt:
“A group of informed experts on the Islamic finance industry called for a “partnership” between Islamic takaful (insurance) industry and Sukuk, toward the end of assisting the latter in providing “protection” for investors against losing their funds that they invested in these Islamic instruments. Those calls became louder after the recent registration of the Pakistani cement company Maple Leaf as the last company with defaults on its Rupis 8 billion Islamic bonds. The experts suggested during their interview with “Al-Iqtisadiya” that Takaful companies should find a new insurance instrument for Sukuk, which can protect the Sukuk holders from the risk of default, by providing “partial” compensation in the case of default.
Click here
for full article:
This only months after the conventional CDS industry nearly brought down the entire international financial system. “Islamic finance” started with a suggestion that the “Islamic economics” philosophy rests on sharing in profits and losses through partnership (i.e. equity) finance. In practice, of course, the industry moved toward debt finance, where the only risk is default risk. Now, they want to insure against credit risk as well, which is of course possible, but defeats the entire purpose.
You see, risk like matter can neither be created nor destroyed. Sharing in profits and losses provides for continuous risk sharing at moderate magnitudes. Debt financing provides for less frequent but larger losses in cases of default. Debt financing together with credit default swaps provides for very infrequent but catastrophic systemic collapse, which is very unlikely at any point in time, but highly likely to occur sometime within an extended period.
So, the most recent crisis has not taught the participants and experts of today’s “Islamic finance” much (I use the quotation marks because they do Islam a great disservice by using it as a brandname to market their grossly inferior and poorly construed products for a profit). Will the customers at least finally see that this is not an infant industry that needs to grow?
“The first step in the risk management process is to acknowledge the reality of risk. Denial is a common tactic that substitutes deliberate ignorance for thoughtful planning.” Charles Tremper
Warm regards

ZULKIFLI HASAN

DURHAM, UK
University of Oxford, UK (Est. 1096)
Islamic finance news
Leave a comment
January 3, 2010
DR. ZULKIFLI HASAN
Hundreds of Gazans marched with international activists against the Israeli blockade
Hundreds of peace activists from forty two countries, in confrontation with the Egyptian police of in the center of Cairo.
Available at:
http://www.indypendent.org/2009/12/31/gaza-freedom-march-on-the-march-at-last/
Hundreds of peace activists from all over the world are engaged in a prolonged  confrontation with the Egyptian police at Tahrir Square that in the heart Cairo,  protest the government of Egypt’s decision to prevent them from entering the  Gaza Strip. Some 1400 activists had arrived from forty two countries all over the world, intending to arrive at the Gaza Strip and to hold a protest parade towards the Erez Checkpoint, together with Palestinian residents, and demand the lifting of the siege which is causing grave daily suffering to the million and half inhabitants of the Gaza Strip. However, the government of Israel applied  heavy pressure on the Egyptians to prevent the activists’ entry into the Strip.  Finally, only one hundred of them were allowed to cross the border, who did  participate in a demonstration opposite Erez Checkpoint, simultaneously with  the rally held on the Israeli side.
The activists who were forced to remain in Cairo were indignant at the government of Egypt, and continued to demand to be allowed to get the Gaza Strip and hold the “Gaza Freedom March” for which they had come, at their own expense, from all over the world. . This morning Egyptian policemen besieged the Lotus Hotel  in Cairo, where many of the activists are staying, preventing them  from going out to the streets of Cairo and demonstrating. However, many of the international activists succeeded in avoiding the police and mingle with the  stream of tourists arriving at the Egyptian National Museum on Tahrir Square.
Suddenly, hundreds of them took off their shirts, revealing t-shirts bearing  the slogan “Freedom to Gaza – Remove the Siege!” and blocked for half an hour the traffic in the central streets of Cairo. Also after the police pushed them to the sidewalk they continued  to demonstrate, raising signs, reading “We Shall Overcome” and chanting “Free Gaza!”, while surrounded on all sides by hundreds of police.
The whole affair causes considerable embarrassment to the regime of  President Hosni Mubarak, who feels unable to use against European and American activists the level of violence often used by the Egyptian police in dispersing demonstrations.  Moreover, the president is at the same time also strongly criticized by the opposition in the Egyptian Parliament, as well as by influentual Moslem sages, for authorizing the construction of “The Underground Steel Wall”, designed to block the tunnels in Egypt’s border with Gaza.
Gush Shalom, the Israeli Peace Bloc, says that the Netanyahu Government was in grave error in pressuring the Egyptians to prevent the entry of international peace activists into the Gaza Strip. Instead of regarding the peace between Israel and Egypt as a major asset, to be used as a bridge in order to achieve  peace with the Palestinians and to the entire Arab World, the government  pressured President Mubarak to adopt an unpopular policy which harms him and makes Israel’s “Cold Peace” with Egypt even colder. That is a highly short-sighted policy”.
“By cultivating the beautiful we scatter the seeds of heavenly flowers, as by doing good we cultivate those that belong to humanity.” Robert A. Heinlein
Best Regards

ZULKIFLI HASAN

DURHAM, UK
Newcastle Upon Tyne, UK
Palestine
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