Business Practices in Islamic Country

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  • Topic: Islamic banking, Islam, Bank
  • Pages : 1 (295 words )
  • Download(s) : 396
  • Published : March 11, 2013
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Business practices in an Islamic country are likely to differ a lot from business practices in Canada. The impact of God is tremendous in Islamic countries, so that Muslim is regulated by a variety of religious principles and moral conducts in their social and economic activities. In this sense, Canadian people may not get used to the ritual nature of everyday life in Islamic countries.

For example, orthodox Muslim ritual requires prayer five times a day. As a result, business people should be aware that the business meetings might be postponed when Muslim participants engage in their daily prayer ritual. Furthermore, when doing business in Islamic countries, the consumption of either pig meat or alcohol is perceived to be violation of Islamic ritual, so the failure of business may occur.

On the other hand, in the Islamic view of the world, humans are part of a collective in which the wealthy and successful have obligations to help the disadvantaged. With a culture emphasising on compassion, when an Islamic business is experiencing financial difficulties, it is inappropriate for debt holders to put on pressure to the business. Nevertheless, in Canadian business world, business people are responsible for their own fortune. It is not the debtor’s duty to help a broke business out. Perhaps, the debtors can even be viewed as victims in western countries.

In addition, under Islamic banking system, interests are prohibited, whereas interest rate and inflation are main profit generators for western banks. Instead of applying interests, Islamic banks would use mudarabah contract or murabaha contract as their substitute system. With the differences in the banking systems, it will be difficult for a Canadian to switch from traditional to Islamic banking system and eventually, making it hard to do business in Islamic countries.
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