Tuesday, May 5, 2009

How to get the gold dinar economy up and running?

Alhamdulillah, some admirable Muslims have previously talked to shop owners and petrol station owners to persuade them to accept dinars as payment for goods. Some success has been made, but still, trade in dinar (and dirham) is negligible.

Trying to increase awareness and acceptance of dinar/dirham trade is far more challenging than simply getting dinars and dirham into the hands of Muslims (and non-Muslims too!). Another critical problem is that to have the greatest degree of success, gold trading should take place in as closed a system as possible. Gold 'leakage' means fiat currency must be used to replace gold that has left the system, maintaining the 'need' for fiat.

But once again, an example of Islamic economics, or perhaps more correctly: 'systems closer to that advocated by Islam'; relative to what we use today, is demonstrated in the non-Muslim world.

"North Carolina Town Prints Own Currency to Support Local Business"


While there are plenty of questions about the 'plenty', i.e. as to its "Islamicness", but it shows dinar and dirham based trading can be done - simply replace a 'plenty' with a dirham. In fact, it is quite amazing that non-Muslims are doing this when it is actually easier for gold and silver to circulate compared to plenty's, due to their greater acceptability and recognised value. Not only that, but the non-Muslims, unlike us are not bound by the acceptance to follow the prescribed laws of Allah, yet they are succeeding.

I suspect economic education amongst the urbanised Muslims is a key factor here and may account for the difference in attitude and motivation between Muslims and non-Muslims.

If you have experience about or suggestions on dinar and dirham micro-economy, or are a trader who would like to get involved in a dinar/dirham basis of trade, please feel free to contribute your comments/suggestions here.