Irish accountancy and law firms will need to divert expertise to Islamic finance if the country is to attract business from this lucrative sector, according to a leading business academic.
Eamonn Walsh, professor of accounting at University College Dublin, said recent changes to legislation and tax rules that paved the way for Islamic finance investors in Ireland had been long overdue. However, he said that professional services firms needed to create a local knowledge base in this area for Ireland to win investments.
IDA Ireland is to promote the International Financial Services Centre as a hub for Islamic funds and banks, which are governed by Sharia law.
These rules do not allow interest to be charged; instead, banks share in the profit and loss of ventures.
Walsh, who has acted as a financial consultant to several large firms in the Gulf region, said there were opportunities in the sector, although Ireland was late coming to the table.
‘‘It is an area that has grown quite rapidly in the last three years," said Walsh. ‘‘It is estimated at the moment that Islamic finance is worth around $260 billion so, in the global economy, it is a small part of the market. But this is expected to quadruple in the next five or six years.
‘‘It would have been better had changes to legislation been [made] a year ago or two years ago, but the fact is that we have them now and that obviously is a good thing," he added.
Walsh said that the changes to Irish legislation paved the way for Islamic banks and funds and sent out a positive message.
‘‘It’s a way of Ireland saying it is serious about the Gulf states and [about] trying to encourage trade and investment," he said.
Source : Thepost.ie