Sie sind auf Seite 1von 32








Name: Ariffhidayat Ali

Matric No: 0900320


The Quran reveals inasmuch as it hides. It reveals to us Allah as the

Almighty, it is clear on treatment of our fellow man and our treatment the
external environment including economic resources.

With regards to muamalat, the unfathomable wisdom of Allah has rendered

mankind guidelines (within the rules permissibility reign). To show Allah’s
love for mankind Allah sent down the practical example namely the Prophet
s.a.w. Thus the theory and practice is perfected. Based on the two sources,
we apply our limited reasoning in deriving decisions and actions to be put in
place. Thus usul al-fiqh points the way to fiqh. The term ‘ijtihad” is often
applied as the exertion that we make to arrive to a particular decision
especially with regards to matters of law.

The concept of “charity” or “benevolent” gives rise to several implements in

Islam. It range from the wajib (“zakat”) to the mustahabb (favoured).
Concepts such as sadaqah and the subject matter at hand i.e. waqf.

Fundamental to applying waqf, is our foremost recognition that all belongs

to Allah. Thus waqf is an instrument seeking Allah’s pleasure thus deserving
of reward. The institution of waqf in Islamic history similar to the religion
has gone through its rise and decline. Present focus on waqf is
overshadowed by focus on Islamic banking and finance. It remains relevant
within the Islamic economic system (which is grounded in the Islamic
Worldview), this paper will emphasized this, it faces challenges to be
elaborated, and it necessitates innovation. The paper will discuss this in
both the Malaysian and the global context.

Key Terms: Al Quran, Sunnah, Shari’ah, Fiqh, Ijtihad, Charity,

Muamalat, Legal, Property, Innovation, Islamic Economics and Islamic


Abstract (i)

Part 1:- Islam as a Comprehensive Gift to Mankind

a) Islam as Religion 1
b) The Notion of Comprehensiveness 2
c) The Gift to Mankind 3
Part 2:- All Economics are derivatives of Reason and Ijtihad
a) Modern Economics as derivatives of Reason 5
b) Islamic Economics as derivatives of Ijtihad 6
c) The Shariah and the “Maqasid” 7
Part 3:- The Essence of Waqf
a) Definition, Motive and Origins 8
b) Constitution of Waqf 10
c) The Current State of the Ummah and 15
Current pre-occupation with Islamic Banking and Finance
Part 4:- Mobilizing resources via the Institution if Waqf
a) Examples from various Muslim countries 16
b) Trends detected in countries cited 21
c) On-going challenges to Waqf 22
C-1:- The Role of Government and Regulators 23
Part 5:- Conclusion 24
Bibliography B1 – B3

Important Note:- All Quranic quotes are denoted by Q followed No.

(Surah) and No. (Ayah). Example Q 2 -36 means Al-Baqarah Ayah 36
Part 1:- Islam as a Comprehensive Gift to Mankind

a) Islam as Religion

From religion is defined as a set of beliefs concerning the

Cause, nature, and purpose of the universe, esp. when considered as the
creation of a superhuman agency or agencies, usually involving devotional
And ritual observances, and often containing a moral code governing the
conduct of human affairs.

Literally the word Islam conjures multiple meanings such as peace,

submission; total surrender of oneself to God (Allah) and put together gives
meaning “peace acquired by submission to the will of God (Allah)”.

Thus peace is contrasted to a state of war/chaos and this peace is not of the
present only but also of the afterlife. Submission and total surrender is
contrasted to false, temporary surrender or surrender with conditions. The
will of Allah is to be contrasted to the free will of Man or any other will (anti-
God) that may have misguided Man. This will if approached in the legal
context renders man subject to duties, obligations, actions that carries
positive, neutral, negative (rewards and punishments). The will of Allah also
entails that accountability for action may be extracted from us in the
present lifetime or in the afterlife.

This will personifies itself into the two primary sources of Islamic law (the
“Shari’ah” literally meaning “the path to water”). The sources are the Al-
Quran and the Sunnah/Hadith of the Prophet Muhammad s.a.w.

b) The notion of Comprehensiveness

The notion of comprehensive entails comprehension and/or understanding.

This is crystallized in the first revelation to the Prophet s.a.w. Without
understanding and/or knowledge the comprehensiveness of Islam cannot be
attained by mankind.

Q 96-1~3:-Proclaim! (Or Read!) In the name of thy Lord and

Cherisher, Who created man, ou t o f a ( me r e) cl ot o f co ng ea l ed
blood. Proclaim! And thy Lord is Most Bountiful, He Who taught
(the use of) the Pen, Taught man that which he knew not.

Besides the initial demand of knowledge/understanding, comprehensiveness

entails multi-dimensional facets in terms of originality, verifiability,
applicability, immutability and transcends all boundaries.

In discussing originality, Islam traces its routes to the Creator (Allah) who
created was is now, what has become, what will be in the future and is the
owner of all. The challenge to the disbelievers to produce a Surah identical
to one of the Al-Quran is the test of originality of Islam.

Comprehensiveness does not entail completeness at the most minute level

but it entails coverage of the relationship between the Creator and Man,
relationship between Man and his inner faculties (body, mind and spirit),
relationship between Man and other men (family, social) and relationship
between Man and the environment (other creations of the Creator).

The above covers our whole existence prior to conception till the Day of
Judgment as per what is now believed to be the last Ayahs revealed to the
Prophet s.a.w.
Q 2-281:- And fear the Day when ye shall be brought back to Allah.
Then shall every soul be paid what it earned, and none shall be
dealt with unjustly.

c) The Gift to Mankind

What makes us so deserving of a gift, the whole reason remains with Allah
but since the gift is clear, it create certain obligations on us and one of it is
to relief the hardship of our fellow men. The prevalent term being used is
“charity” and Islam has elevated “charity” to such a high-level namely the
obligatory (zakat), the recommended (mandub) as per the following:-

Q 5-55:- Your (real) friends are (no less than) Allah, His
Messenger, and the (fellowship of) believers, - those who establish
regular prayers and regular charity, and they bow down humbly (in

The importance of charity is related to the given human

condition, each of us is endowed with differing qualities,
attributes, skills and dispositions. This is also demonstrated with
regions or geographical having endowed with differing resources
thus giving rise to trade due to the theory of comparative
advantage, specialisation. With time communities with different
level of wealth, economic development became pronounced and
thus the level of inequalities also existed. The history of the
human race has been fraught with struggles over economic
resources or Allah’s bounty.

Whilst Q 96 1-3 has been viewed as the first revelation, there are
others who opined that Q 96 1-5 as being the first, namely Ayahs
4-5 “Day, but man doth transgress all bounds. In that he
looketh upon himself as self-sufficient”.

The above points to the corruptive influence of economic self-

sufficiency without the realization that the abundance is in itself
a gift from Allah. To subvert what belongs to Allah as belonging to
man who is the caretaker is to be forgetful of our position as “Abd
– servant” and “Khalifah – vicegerent” as appointed by Allah.

Since we are creatures needing reminding, thus the particular gift

of Al-Quran, the Shariah, the Sunnah/Hadith (practices, sayings,
actions, silence, approvals/disapprovals of the prophet). These
are all meant to correct, guide mankind to accept his actual
position in the Universe.

A major point to be stated is that “charity” as stated above should

not be construed as mere hand-outs. The author sees this as
more namely the means of mobilizing resources. Resources
encompass man, the environment, man-made implements,
technology and financial capital. Thus “charity” is to be seen as
the “fishing rod” being given to the fisherman.

Islam itself has become a great leveller in terms of its focus on

economic justice, in terms of redistributing economic resources,
surpluses via encouraging both individual and collective effort. So
much so that the majority of initial converts to Islam were
initially economic disenfranchised and the richer converts gave
up their wealth without much persuasion.

This model of “selflessness” permeates throughout Islamic
Economics. Contrast this model with the “self-interested” model
of Classical Economics. ‘Selflessness” does not mean surrender to
the will of Allah (for Allah will is unknown, man remains a “free
agent”). Thus the Prophet s.a.w admonished the Bedouin for not
tying his camel. Selflessness entails surplus thus a rich Muslim
is preferred to a poor Muslim.

Part 2:- All Economics are derivatives of Reason and Ijtihad

a) Modern Economics as derivatives of Reason

All branches of modern science derive its foundation from mankind

preoccupation with philosophy. Philosophy is in itself a struggle of man in
rationalizing his own existence, the concept of “self”, quest for “truth”
independent of self, search for an “independent reality”. All of this uses the
faculty of Reason. Much contribution were of Greek origin,
unknown/unrecognized are the contributions of Muslim philosophers,
scientists etc. Throughout the ages economics became its own discipline
bearing contributions of the Mercantilists, Physiocrats, Classical, Keynesian,
Marxist and various offshoots. What remains is a body of knowledge
divorced from religion much like other Western sciences (although there are
some who opined that there remain traces of the Protestant work ethics in
classical economics). However we conclude that present day economics
remains concern with the secular, non religious, pre-occupied with the
earthly life thus the struggle of modern economics in tackling the economics
of externalities, the impact of present day action on future generations and
the focussed on monetary measurement as the only viable measure of
human action.

b) Islamic Economics as derivatives of Ijtihad

The Al-Quran and Sunnah gave the parameters and guidelines pertaining
conduct within the economic realm. Islamic Economics recognizes the role of
consumers, producers, the government’s role, the role of international trade,
the role of money in facilitating trade, the role of the market, market
imperfections, the price mechanism etc. These activities are to be conducted
within a “riba-free”, maysir-free (speculation) and gharar-free environment.
This remains the model par excellence however the human condition of
varying levels of “taqwa”, the competition from non-Muslims, the disparities
between nations etc does not entail the ideal.

Sait & Lim (2005) cited The Qur’an contains no specific reference to the
endowment (waqf) and its legal parameters have been developed through
centuries by jurists. It is inspired from repetition and emphasis upon
charity within Islam as an act of devotion to God. In the Sunnah, waqf is
seen as a legacy from the tradition of the Prophet Muhammad s.a.w. when
he said: "When the son of Adam dies, all his good deeds come to an end
except three: ongoing charity, knowledge from which others may benefit
after he is gone, and a righteous son who will pray for him." (Sahih Muslim)
‘Ongoing charity’ in the said hadith is the basis of waqf. What developed
since is an institution developed out of “Ijtihad”.

Most scholars define Ijtihad as the effort of a “Mujtahid” to coming to a

decision pertaining to a legal matter by reference to the sources of Islamic
law (the collective term for Islamic law being Shariah, the primary sources
being the Al-Quran and Sunnah) and other secondary sources namely
qiyas, ijma, istihsan , urf etc. Muamalat was ripe for the application
of Ijtihad since Al-Quran did legislate as much in this area. The validity of
Ijtihad is unquestionable (Muaz ibn Jabal case in point).

The decline of Islam has been commented as related to the decline in Ijtihad.
Perhaps this remains a simplification, the author points towards disunity,
the secular approach of some Caliphs post Ali Ibn Talib, the repression
meted out to scholars and perhaps lack of “religious” leadership who saw
rebellion as a valid weapon against tyranny as opposed to “non-violence”

c) The Shariah, the Maqasid and Waqf

Shariah is all encompassing; it does not embrace the obligatory only but
also includes the much preferred notion of charity. Interlinking this with
waqf, it is logical that waqf serves the objectives (Maqasid) of the Shariah.
What is more pronounced is that the institution of waqf impacts the three
overriding objectives namely Educating the Individual, Establishing Justice
(Adl’) and Consideration of Public Interest (Maslahah) clearly. In retrospect,
the preferred in Islam impact all three objectives to varying degrees. One
important point that needs pointing out is the various classification of
charitable donations/source of finance in Islamic history. This contrast is
necessary if we deemed waqf as being important. The classifications were as
1) Khums (i.e. part of the booties of battles),
2) Fai ,
3) Zakaat,
4) Sadaqah,
5) Ushr,
6) Kharaj,
7) Jiisya,
8) Ransom money,
9) Khums of Treasure Trove,
10) Contribution of the Muslims in time of need

More on these are no longer applied and replaced by seignorage (money

creation) and public sector borrowings. (Issues remains with both)

Part 3: The Essence of Waqf

a) Definition, Motive and Origins

(a1) – Definition

According to What is Waqf? (2007), the word waqf literally means ‘to stop,
contain, or to preserve. In Ahmed (2005), in the context of the Shari'ah, it
implies a form of gift in which ‘the corpus is detained and the usufruct is set
free’. The meaning of 'detention' of the corpus in this context, is its
prevention from being inherited, sold, gifted, mortgaged, rented, lent, and
others. As to the meaning of usufruct, it means its devotion to the purpose
mentioned by the waqif (donor) without, any pecuniary return.

According to What is Waqf? (2007), a Waqf is a voluntary, permanent,

irrevocable dedication of a portion of ones wealth, in cash or others, to
Allah. Once a waqf, it belongs to Allah and the corpus of the waqf always
remains intact.

(a2) – Motive of Waqf

The motive of waqf is always religious. Seven words but to a true Muslim,
this represents his or her entire existence. It does entail achievement of
sorts and the author suggest that the “thought process” of a waqif should
be a subject of further research since charity can take various guises and if
we were to name the likes of affluent Muslims in Malaysia such as Syed
Mukhtar Al-Bukhary, Tan Sri Halim Saad, the notable Razak family all have
foundations to their

name and yet all have not alienated any of their holdings into a waqf. The
author doubts that this is out of ignorance, out of irreligiousness (the author
does not wish to discuss person/s religiosity). This is perplexing and gives
rise to concerns over the “perception” of wealthy Muslims on the idea
of the “waqf”.

Leaving this aside, waqf is mubah or permissible act, but it must be

remembered, even though waqf is not considered wajib, there is a striking
peculiarity connected to it. The term waqf itself imports religious merit
thawb. The basic for the transaction and consideration for it being thawab
means there is no other human disposition which enjoys this peculiarity.
Waqf refers as a desire to approach Allah.

(a-3) Origins of Waqf

‘What is Waqf?’(2007) outlines the origins of waqf. According to the article,

based on hadith, which was reported by Ibn ‘Umar: ‘Umar acquired land in
Khaibar. He came to Allah’s Apostle (saw) and sought his advice in regard to
it. He said: “Allah’s Messenger, I have acquired land in Khaibar. I have never
acquired more valuable for me than this, so what do you command I do with
it? Thereupon the Prophet (saw) said: If you like, you may keep the corpus
intact and give its produce as Sadaqah. So ‘Umar gave it as Sadaqah
declaring that the property must not be sold or inherited or given away as a
gift. And ‘Umar devoted it to the poor, to the nearest of kin, to the
emancipation of slaves, to wayfarers/guests, and in the way of Allah. -
Sahih Muslim.

The above hadith is believed to set the precedent for Muslims, to popularise
the waqf system for any imaginable shari’ah compliant purpose.

Others points towards the Kaabah as the first, others point to the mosque in
Quba’ and we take these multiple claims as signs of where the early
Muslims placed their priorities.

b) Constitution of Waqf

(b-1) Conditions of validity

Muhd Zain (1982) outlines conditions or principles to be adhered to, for

waqf property to be valid. The conditions are per listed below:

• The waqif
The settler waqif must be of full age, sound mind and unrestrained in the
use of his own property. He must therefore, able to understand the effect of
his action, a free man and not a slave.

• Clear intention of waqf

The property must be declared waqf with clear intention. The dedication
may be either oral or written.
It’s sufficient for the settler to indicate his intention to make the property
waqf, and to specify the charitable purpose to which it is to be devoted. It is
generally accepted that this declaration is sufficient in itself the creation of a
waqf and that the delivery of possession to the mutawalli or administration
is not an essential condition of validity

• Predetermined property
According to Osman (2002), Shafie scholars are in consensus regarding the
intended waqf property must be predetermined first before waqf status is
being established. If ambiguities exist or the property cannot be determined
due to certain circumstances, the waqf is considered invalid.

In Public Trust (Ahmed), there is no doubt that prior to donation the waqf
property is owned by the waqif, because a person cannot make waqf of a
property that he does not own.

The intended waqf property must be tangible. A waqf is also considered to

be invalid if its ownership is not established, such as reserved order, which
has not been received yet by its owner.

An incorporeal right cannot be dedicated as waqf, and for movable property,

if there’s conflict of opinions.

• Perpetuity and Continuity

Majority of scholars agree that the declaration of waqf must be irrevocable,

unconditional, and permanent. If in the case of a testamentary waqf which
takes effect solely upon the death of the founder, the declaration must be
intended to take effect immediately.

According to Ahmed (2005), all schools, with the exception of the Maliki
school, concur that a waqf is valid only when the waqif intends the waqf to
be perpetual and continuous, and therefore it is considered a lasting
charity. Hence if the waqif limits its period of operation, such as when he
makes waqf for certain specified limit time frame or until an unspecified
time when he would revoke it at his own pleasure, it will not be considered a
waqf in its true sense.

Many scholars agree that such condition implied on the intended waqf,
nullifies the waqf, though it will be considered as valid habs (detention) if
the owner of the property intends habs. But if the owner intends it to be a
waqf, it will be nullify the conditions to be a valid waqf and a valid habs as
well. By a valid habs, it is meant that the usufruct donated by the owner for
a particular object will be so applied during the period mentioned and
return to him after the expiry of that period.

According to the Maliki school, perpetuity is not necessary in waqf and it is

valid and binding even if its duration is fixed, and after the expiry of the
stipulated period the property will return to the owner.

• The object of waqf must be a work pleasing to Allah, although this is not
always apparent on the surface. It must be charitable in general sense.

(b-2) Subject of waqf

Subject of waqf refers to what may be dedicated as waqf. Below are the
subject of waqf as per outlined by Muhd Zain (1982) in his book, Islamic
Law with special reference to the Institution of Waqf:

• Immovable property

All jurists of all schools are in entire agreement as to the validity of waqf as
immovable as illustrated in the early history of waqf institution, where waqf
of land is widely made by the companions of Prophet Muhammad s.a.w.

It’s also lawful to dedicate every movable that may be an accessory to it, as if
dedicating cattle and slaves.

• Movable property

There are differences of opinions for movable property since the prevailing
view indicates that movable cannot be made waqf because they do not
possess the quality of permanency. Yet, some exceptions had been made
upon movable property beneficial uses such as movables attached to
immovable property. Even it is valid to make waqf of such movables with
respect which had been ‘urf in the society, such as copies of Holy Qur’an,
axe, books or water from a public fountain.

• Undivided property (musha)

Majority jurists agree that the waqf of share in a property, which is
incapable of partition is valid. Waqf of undivided share in a thing, which is
not capable of partition is also considered valid.

The above Fiqh cuts across the following the following time span:-
i) 610 AC – 661 AC (Prophet s.a.w – Ali Ibn Talib leadership)

Contrast the above to the time of the Four Sunni Imams

1. Imam Malik – Maliki school (circa 711 - 795). Locality Madinah.
2. Imam Abu Hanifa – Hanafi school (circa 699 - 765). Locality Iraq.
3. Imam Shafii – Shafii school (circa 767 – 820). Locality (various)
4. Imam Hambali – Hambali school (circa 780 – 855). Locality (Baghdad
although he also travelled extensively)

In the context of muamalat great was the contribution of Imam Hanafi, in

the context of simplicity of approach it was Imam Malik, methodology goes
to Imam Shafie whilst Imam Hambali was overshadowed by Imam Shafie
although remaining steadfast in his treatment/collection of the hadith.

The above also entails different locations, time, economic development, the
Umayyah, the Abassids, the melting pot of expansionary Islam and other
contexts that affected the Fiqh of the Imams.

The next often cited period of intense waqf activity was during the rule of the
Ottoman Empire (Turks of “Hanafi” persuasion). Why this is is just that the
state took deep interest in the institution of the waqf as compared to earlier.

Before going further the key points already pointed out and new points to be
developed needs stipulation:-

i) Waqf is a result of Ijtihad.

ii) The leeway accorded to “Ijtihad” was large.
iii) Each “Fiqh” school contributed in line with their understanding of the
subject matter.
iv) Waqf is a “privately” driven initiative (the Ottoman period is an
v) The public sector in early Islam was almost non-existence. Case in
point the “Treasury” was only instituted during Umar Al-Khattab’s
time. The role grew (Siddiqi is the prime commentator on this matter)
vi) The “old economy” was agriculturally driven thus land being
discussed most in waqf literature. Colonialism was severe on land
thus stifling waqf. (Leaving discussion of “cash waqf” aside for now,
the studies of Cizacka in this area is pre-eminent).
vii) The voluntary will always be secondary, the ups and downs of Islam,
of Islamic economics impacts elements within the economic system
differently (waqf contrasted to zakat)
viii) Fewer studies have been made on waqf as compared to let say Islamic
banking and finance. Islahi (2003) on Waqf bibliography cited no
major references on waqf law post 2000, on cash waqf it was 2002.
Why stress the above is due to the author not wanting to dispute the role
and the contribution of waqf in early, in medieval Islam up till perhaps the

Much Ijtihad was applied at the beginning but not of late.

c) The current state of the Ummah & current pre-occupation with

Islamic Banking and Finance

Below is from the author earlier work questioning whether the Ummah, the
Maqasid al Shariah is being championed by Islamic Banking and Finance.

The Pew Forum on Religion & Public Life (2009) estimated that there 1.57
billion Muslims in the world making up 23% of the world population. More
than 60% of the global Muslim population is in Asia and about 20% is in
the Middle East and North Africa. Two-thirds of all Muslims worldwide live
in 10 countries, six are in Asia (Indonesia, Pakistan, India, Bangladesh,
Iran and Turkey), three are in North Africa (Egypt, Algeria and Morocco) and
one is in Sub-Saharan Africa (Nigeria).

Economically these countries rank low in terms of per capita income faced
with numerous handicaps such as ruled by corrupt and dictatorial
governments, having little or dwindling resources and subjected to
international sanctions in the case of Iran. The author concluded that
arriving to the Maqasid via Islamic Banking and Finance is questionable
and much repair is needed due to our preoccupation with such capital
market instrument of “sukuk” bent on the profit motive and competing
with conventional offerings.

Part 4:- Mobilizing resources via the Institution of Waqf

Much has taken place since the revival and interests in Islamic Economics.
The waqf itself has attracted much attention. Below are some examples
from various Muslim countries:-

i) Malaysia

The establishment of the Department of Waqf, Hajj and Umrah in 2004

under the Ministry of Prime Minister Department shows the commitment of
Federal Government to consolidate waqf activities at the national level.

Johor Corporation is seen as a quasi-governmental body particular having a

deep interest in the waqf. In 2006 it launched the Corporate Waqf share and
via its subsidiary the Kumpulan Waqf An-Nur, a number of clinics known as
An-Nur Waqf Clinic in various places and a hospital was initiated. This has
been depicted as part of the Corporate Social Responsibilities (CSR) agenda
of JCorp.

In 2008, the Waqf Foundation of Malaysia (YWM) was set up to strengthen

waqf developments in the country. Currently, the foundation actively
promotes its waqf fund projects and cash waqf scheme.

In October 2009, International Islamic University Malaysia (IIUM) held the

International Conference on Waqf Laws & Management, Realities and

The world of academia, concerned corporate bodies and the federal

government were instrumental for the above.

ii) Singapore

A small island state renders the management of Islamic affairs under the
sole authority of Majlis Ugama Islam Singapura (MUIS). It has taken bold
steps to safeguard Muslim interests in a non-Muslim dominated nation.
Much of its activities are commercially oriented vis a vis the real estate
property under its administration (price of real estate is premium in
Singapore. The two major financial tools utilized are via the cash waqf and
the “sukuk” based on the “Musyarakah” concept.

iii) Kuwait

Perhaps smaller nations have the natural advantage of easily mobilizing

waqf resources. Mohd Daud (1999) outlines the waqf institutions in Kuwait
and the United States. Waqf in Kuwait dates back to 1695 and in recent
times, waqf administration system is being administered under Ministry of
Awqaf and Religious Affairs. Waqf administration in Kuwait started in year
1949 with the establishment of Public Waqf Centre, who is in charge of
mosques’ administration and public waqf property.

The centre act as a trustee to

• Administer waqf property which doesn’t have any nazir assigned to it

• Spend excess revenue from waqf to fields which are not mentioned by
• Administer special waqf where its intended heir died
• Administer waqf property that’s beyond repair by its administrator
• Administer waqf property, which had been handed by the Sha’riah Court
• Administer any other types of waqf

The Centre is being administered by Waqf Council, which usually consists of
several prominent people in the society. The Centre is being headed by
President of the Waqf Council, who also acts as the director.

After Kuwait’s independence, the centre had been renamed as a ministry

and waqf administration function had been broadened to cover such an
extensive scope. The ministry organise activities to increase communities’
awareness towards creating new waqf property. Besides that, Waqf property
is also invested through proper channels either through stock and property
market through Islamic financial institution, with the aim of increasing the
value of waqf property. The ministry is also engaged in developing waqf
institution through research and development.

In 1993, Kuwait Awqaf Public Foundation was established to strengthen the

role of waqf in socio-economic development. 70% of the waqf properties
owned by (KAPF) had income generating potential (Ahmed, 2004). An
autonomous General Secretariat was also established to administer waqf
funds better. The emphasis is to utilize new waqf funds for investments as
well directing the revenue for specific objectives. This is one of the trends
that are enveloping the waqf world where there is a growing emphasis on
“investment” or “liquid” types waqf funds via instruments such as the Cash
Waqf. Till today the foundation is active in promoting waqf, the waqf tarajim
initiative serves as a database of person/s involved in the hope of revitalizing
the waqf with links to various other bodies in Kuwait as well in other Middle
East/African nations. If the Maqasid entails educating the individual, this
initiative personifies it in its simplest form.

iv) The United States

Waqf institution is developed differently. This is by virtue of the secular

nature of American society whereby the government remains aloof of
religious matters. Traditionally local Muslim communities will establish a
non-profit organization, which in turns owns the waqf (Kahf, n.d.). Another
way for Waqf administration is managed via the North American Islamic
Trust. This foundation is managed by few trustees who are selected among
Muslim communities in the United States.

The moment the foundation was established; all waqf properties owned by
Muslim Students’ Society in the United States, such as mosques and
buildings, the ownerships were transferred or waqf to the foundation. The
foundation was further developed through cash waqf, which are then used
to acquire buildings for education purposes and mosque. The foundation
also provides various services such as financial assistance, books or
scholarly journals publication, and Islamic audiovisual related equipments.
The foundation plays an active role in ensuring waqf property development
through direct investments such as agriculture sector, poultry rearing, food
& beverages or investment through Trust Fund.

It is common in the United States to use North American Islamic Trust’s

approach in waqf development. But, according to Mohd Daud (1999), the
approach will only works best through cash waqf since it wouldn’t involve
issues of ownership exchange from waqif to the foundation.

Dr. Monzer Kahf has opined that the major challenge to Muslim in
protecting waqf properties in the United States and also North America
comes via the ability of the waqf managers (mutawalli) to dispose of the waqf
fraudulently as well as the ability of non profit organization (waqf) to be sued
by other external parties (Kahf, n.d.).

v) Pakistan

It has a long experience with awqaf nevertheless it remains an extremely

poor nation with per capita income of USD $ 517 and 34% of its population
remains under the poverty line (Ahmed, 2004). Similar to most nations, waqf
administration is in the hands of the government. In Pakistan case, it is
administered by the provincial governments.
Initially Awqaf in Pakistan were managed by private concerns and
individuals. One of the drawbacks of privately managed waqf is the potential
of fraud and mismanagement. This forced the government to assume
responsibility in 1959 operating via the provincial governments. Based on
the two province of Islamabad Capital Territory and the province of Punjab,
there are some pertinent points to be raised on the administration and
application of waqf.
• Emphasis remains on the management of mosques and shrines
• Income are from donations by devotees
• Most of the activities are for religious/charitable purposes
• There is a bureaucracy involve in maintaining and administering the
• In Punjab, 35.8% of total revenue is spent on administration compared to
31.5% on Religious Affairs, 10.5% on Health and only 2% on Social
• There is excess revenue over expenditure.
• Only 30% of the revenue is generated from leasing and rents

4b) Trend detected in countries cited

i) The increased role of government in championing the waqf.

ii) Academics remains deeply interested in waqf focussing mostly on the
legal impediments to waqf, looking at alternative structures to enhance the
waqf, most times via “sukuk” of various types, particular emphasis on
Musyarakah. Most developments are construction related.
iii) Cash waqf is seen as the “magic bullet” to be utilized rather than
repair existing defects in other forms of waqf.
iv) Involvement of corporate bodies remains limited. However the Johor
Corp Corporate Waqf is a model to emulate (refer JCorp Annual Report
v) Ease of organization in smaller countries.
vi) Experience does not guarantee success and the social context impacts
the “reform” agenda if any.

These trends are positive but as yet giving rise to concerns.

i) Political support changes over time. The previous Prime Minister

supported the “waqf”. He introduced “Islam Hadhari”. This is no
longer heard today, it is all about “1Malaysia”.
ii) Government institutions may be bureaucratic,
wasteful in
Nature and remain prone to moral hazard issues.
iii) Academics may theorize but theory into policies takes time.
iv) Cash waqf remains misunderstood outside academia and
practitioners. There remain multiple variants to it. Different fiqh persists.
v) Successes are not publicize and remains away from media spotlight.
vi) The culture pervasive in a particular country impacts initiative.

4c) On-going challenges to Waqf

As early as 1999, Kahf has raised his opposition to government

administered or controlled waqf. He also identified unresolved fiqh related
issues. The two are not only the issues that are preventing waqf gaining
faster momentum.

Legal issues pertaining to land matters is a global issue affecting waqf, non
existence of Waqf laws in Non-Muslim countries may impact its legality,
majority of endowments is economically non-productive since it carries
religious usage. Transparency of managers, knowhow and skill to manage
for value (i.e. accruing economic benefits) remains limited if the managers
are employees of the State Religious Departments more predisposed to
either office management, family law or issues over inheritance.

Waqf accounting as a branch of accounting is yet comprehensive, Shahul

Hameed & Hidayatul Ihsan (n.d) have pointed that we may need to use
accounting standards developed for the use of charities in the United
Kingdom to support the need for accounting and transparency. In certain
countries, record keeping was hazardous making some endowment
unrecognizable, some sold to Non-Muslims (something that’s old need not be
technologically deprived). The author cites lack of “individuals” of renowned
financial standing campaigning for the “Waqf”. Earlier mentioned of wealthy
Malaysia not participating is a case in point. We need the “Cat Steven’s”, the
Bono’s pushing for this agenda. An old world example will be the likes of
Imam Shafie who travelled extensively to campaign for his methodologies.
Personalities and belief mixed together remains a very powerful potent in
encouraging others to participate especially with regards to something

4C-1) The role of Government and Regulators

Taking Malaysia as an example, the Bank Negara Malaysia Annual Report

2008 does not mention waqf; neither does the Takaful Report 2005. Where
do we search for such, Offshore Banking via LOFSA (Labuan Offshore
Financial Services Authority) but lip service is the treatment given.

It is parked under the concept of “trust” an offshore banking implement. If

“trust” was not an implement it is doubtful whether waqf will ever come into
the picture.

Few questions arise:-

i) Is this a rejection of the economic role to be played by waqf?

ii) Is “redistributive economics” not part of macroeconomics?
iii) The 3rd sector is not seen as a potential fiscal stabilizer in a world
dominated by emphasis on “laissez faire” government and pre-
occupation with monetary stability?
iv) What then is the value of the 3rd sector to the Maqasid-Al-Shariah?
v) The Maqasid-Al-Shariah is not important to our economic thought
leaders in Malaysia?
vi) Is Waqf to be treated as the poor man economics since waqf is subject
to the realm of developmental economics, push it to one side, let the
scholars talk about waqf being an instrument of micro-finance (much
literature on this)
vii) Is it too much Ijtihad being applied elsewhere in other areas (for profit)
and too little Ijtihad applied to the waqf (for the Maqasid)

A suggestion of the author, we talk about Malaysia being a “halal” hub. Why
not utilize the “waqf” as a mobilizing instrument in our quest for this status?
Need we depend on banks, on venture capitalist to support such initiative?

A hub promotes international trade between Islamic nations; only then

abundance can be shared across boundaries more so with the poorer
Muslim nations.

Failure to answer or refusal to answer the above undermines the ability of

waqf to promote economic growth. Putting aside economic growth, even the
smaller objective of poverty alleviation is sacrificed. The role of international
bodies like the World Awqaf Federation, the Islamic Development Bank (IDB)
and the United Nations (UN) can still be enhanced.

Is the cap on the feathers for the modern waqf is to be the ZamZam Tower.
Quote “Sukuk Al-Intifa’a – the right that entitles all Muslim from around the
world regardless of their nationalities to obtain a residential suite in
ZamZam Tower”

Unquote – (if you are poor, you have don’t have the right). The author is
sure that this deprivation if told to Umar Al-Khattab it will bring tears to his

Part 5:- Conclusion

The volume of scholarship on the Waqf is constantly on the rise. The

author’s owned learned teachers like Dr. Yusuf Saleem wrote on
Institutional Mutawaali (increasing professionalism in Waqf) and Nurhaliza
Mohd Nor & Mustafa Omar Mohammed wrote on categorization of Waqf
Land and working towards investment models for usage in Selangor. Others
like Umar Oseni wrote on Nigeria (important since Nigeria is a country gifted
in resources but manipulated by its political masters) and Adnan’s Takric
writing on Bosnia (a country ravaged by war and seeking to re-gather its
Islamic heritage) shows the on-going life and death struggles of some

Muslim to deal with economic matters. The real problem inhibiting a

complete revival of Islam as a whole is the lack of political will that
approaches Islam in totality. The success of early Islam is secularism is
rejected outright and the religion is put ahead of “self”. The absence of a
collective will at the top also permeates below at the level of mass society.
Reform movements are often sidelined as attempts toward radicalizing the
accepted mainstream. Ijtihad is sidelined to academia or into patronage
driven think tanks.

Islamic history is undeniable. The golden age of Islam is the golden age of
Islamic Economics. Our present preoccupations due to the above represent
a “brake” to the waqf playing its intended role in Islamic Economics. Without
shifting mindsets (at the top and/or grass root pressure), we do not do
justice to the likes Mohammad Baqir al-Sadr, to Chapra, to Siddiqi, to
Mannan and a list that goes longer by day. The author also doubts that the
Prophet s.a.w will be pleased with the present as compared to his pleasure
of accepting the answer from Muaz Ibn Jabal.

Whilst we wait as such, the current efforts of modelling alternatives should

be continued. This with the hope of generating enough thought leadership
that will oppose the mainstream trend. Once this is achieved by the forces of
natural or perhaps divine justice, the falsehood will be swept away without
as much of a whimper. Thus the assembly of a ready force comes in and
rejuvenates society whilst at the same time monitors itself against the
corruptive influence of power.


Pg 1
religion. (n.d.). Unabridged. Retrieved December 01, 2009,
from website

Pg 6
Sait, Siraj and Lim, Hilary, Dr. Islam, Land & Property Research, Paper 7
Waqf (Endowment) and Islamic Philanthropy. United Nations Human
Settlements Programme (UN-HABITAT), Nairobi, Kenya (2005)

Pg 8
What is Waqf? (2007) Retrieved December 1, 2009, from National Awqaf
Foundation of South Africa website:

Ahmed E. Souaiaia (2005). Public Trusts. Retrieved December 17, 2009,

from Islamic Law Shari`ah website:

Pg 9
What is Waqf? (2007) Retrieved December 1, 2009, from National Awqaf
Foundation of South Africa website:

Pg 10
Muhd Zain bin Haji Othman (1982). Islamic Law with Special Reference
to the Institution of Waqf. Kuala Lumpur: Prime Minister’s Department.
Osman Sabran (2002). Pengurusan Harta Wakaf. Skudai, Johor:
Universiti Teknologi Malaysia.

Pg 11
Ahmed E. Souaiaia (2005). Public Trusts. Retrieved December 17, 2009,
from Islamic Law Shari`ah website:

Pg 12
Muhd Zain bin Haji Othman (1982). Islamic Law with Special
Reference to the Institution of Waqf. Kuala Lumpur: Prime Minister’s

Pg 14
Islahi, Abdul Azim, Dr. Waqf, A Bibliography. Scientific Publication
Center, King AbdulAziz University, Jeddah, Saudi Arabia, (2003)
Pg 15
Mapping The Global Muslim Population, A Report on the Size and
Distribution of the World’s Muslim Population (October 2009),
PewResearchCenter, The Pew Forum on Religion and Public Life

Pg 16
On Johor Corporation, obtained from JCorp Annual Report 2008

Pg 17
Mohd Daud Bakar (1999). Amalan Institusi Wakaf di Beberapa Negara
Islam. In Nik Mustapha Nik Hassan (ed.). Konsep dan Pelaksanaan
Wakaf di Malaysia (pp. 155-187). Kuala Lumpur: Institut Kefahaman
Islam Malaysia.

Pg 18
Ahmed, Habib (2004). Role of Zakat and Awqaf in Poverty
Alleviation. Occasional Paper No. 8. Islamic Development Bank, Islamic
Research and Training Institute

Pg 19
Mohd Daud Bakar (1999). Amalan Institusi Wakaf di Beberapa Negara
Islam. In Nik Mustapha Nik Hassan (ed.). Konsep dan Pelaksanaan
Wakaf di Malaysia (pp. 155-187). Kuala Lumpur: Institut Kefahaman
Islam Malaysia.

Kahf, Monzer, Waqf an Its Sociopolitical Aspect. United States (n.d)

Pg 20
Kahf, Monzer, Waqf an Its Sociopolitical Aspect. United States (n.d)

Ahmed, Habib (2004). Role of Zakat and Awqaf in Poverty Alleviation.

Occasional Paper No. 8. Islamic Development Bank, Islamic Research and
Training Institute

Pg 21
On Johor Corporation, obtained from JCorp Annual Report 2008

Pg 22
Kahf, Monzer, Towards the Revival of Awqaf; A Few Fiqhi Issues to
Reconsider. Paper Presented at the Harvard Forum on Islamic Finance and
Economics, October 1, 1999. Harvard University United States

Shahul Hameed and Hidayatul Ihsan, Waqf Accounting and possible Use of
SORP 2005 to Develop Waqf Accounting Standards. International Islamic
University Malaysia. (n.d)

Pg 23
Bank Negara Annual Report 2008
Takaful Report 2005