Islamic financing could provide $2.5 trillion USD needed to end global povertyMay 26, 2017
Muslims around the world mark the beginning of the fasting month of Ramadan this week, and millions will be giving their zakat fitrah. Islamic charitable giving zakat is one of the world’s largest forms of wealth transfer to the poor. In a new report released today the United Nations Development Programme (UNDP) Indonesia and the state zakat agency Baznas are calling for an increase in the use of formal institutions to channel zakat contributions so funds can be more effectively distributed to alleviate poverty.
In 2015, 193 nations committed to achieving 17 Sustainable Development Goals to end poverty, reduce inequalities and tackle climate change by 2030. US$3-4.5 trillion in financing is needed to achieve them. Current investment is around US$1.4 trillion, creating a shortfall of US$2.5 trillion.
The foundational goals of zakat overlap with the goals of the Sustainable Development Goals including reducing poverty, improving health and protecting the environment. Islamic finance, including zakat funds, are estimated to climb to US$3 trillion by 2020. With effective management of these funds, they would be one of the most significant sources of funding to achieve the SDGs.
Read the report in English
Read the report in Bahasa Indonesia
Read the report in Arabic.
- $3-4.5 trillion in financing is needed to achieve the Sustainable Development Goals by 2030. Current investment is around $1.4 trillion, creating a shortfall of $2.5 trillion.
- Islamic finance, including zakat, is estimated to be valued at around $2 trillion in 2015, which could climb to $3 trillion by 2020.
- Making zakat contributions through formal institutions can ensure it reaches more people, and reaching those in greatest need.
Communications Specialist, UNDP Indonesia