February, 15 , 2010

The fledgling Islamic finance industry is still growing thanks to new markets and an inflow of oil money, but it is struggling to leave behind the legacy of the global financial crisis in the form of a real estate crash in the Gulf Arab region.Islamic banking is one of the world's fastest growing financial sectors, according to industry estimates. It has attracted more attention in the aftermath of the global financial crisis as investors are increasingly looking for alternative, ethical ways of investing.

But in the Gulf Arab region, alongside South East Asia its most important regional centre, a funding crunch at Bahrain-based Islamic investment house Gulf Finance House shows that the industry still has a long way to go to diversify from real estate products and investments."We have the same state of affairs across the region whether the companies are listed or unlisted", said Mohieddine Kronfol, managing director at Dubai-based Algebra Capital.

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