He said though the Islamic asset management industry remains marginal and fragmented and continues to lag behind conventional systems which is estimated at US$58 billion, its characteristics to compete in the market through values, ethics and authenticity will prove to be advantageous in the future.
"The industry has several competitive strengths in light of the evolving economic paradigm, including increasing institutional demand where sophistication has led to a rise in the number of Shariah-compliant alternatives for institutional investors," Khan added.
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According to an Ernst and Young report Islamic finance assets was expected to hit US$1.8 trillion in 2013 and Islamic asset management is expected to grow around $300 million to US$500 million this year.
"There is also a continued retail demand as global middle class will grow by more than 160% in the next 25 years from 1.8 billion in 2012 to 4.9 billion in 2030. The projected expansion of the global middle class is leading to exponential growth potential in takaful, waqf and pension funds," Khan said.
According to him, though the global economic outlook is negative, this would not prevent Asia as well as the Middle East and the North Africa region (MENA) to become growth engines for the Islamic asset management industry.
Painting a positive picture of the Islamic management industry, the Dubai-based Fajr Capital Group CEO said the industry has played a significant role in the evolution of Islamic finance, which started in Saudi Arabia with the Darul Maal but it lacked the framework to succeed, forcing the industry to focus on Islamic banking.
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