Presentation poverty

Disscuss the conception and

classification of material poverty

from Islamic perspective and

elaborate the view that it is not

possible to eliminate its existence

even in Islamic economic system.

QUESTION

CONTENT

Conception of Poverty from an Islamic

perspective

Poverty in Islamic sources

Islamic understanding of poverty

Classification of poverty

Causes of Poverty

Towards the establishment of poverty reduction

strategies

Muslims amongst world‟s poorest

Why poverty cannot be eliminated?

CONCEPTION OF POVERTY FROM AN ISLAMIC

PERSPECTIVE

Poverty in Islam is concerned with insufficiency of income and

the inability in fulfilling basic human needs. One is considered

poor if he does not possess sufficient necessities to fulfill his

basic needs. (The World Bank Group. Poverty Trends and Voices of the Poor. 4th Ed, May 2001)

Islam views poverty as a threat to human‟s believes and to

the security and stability of the society as a whole. The

objectives (Maqassid) of Shari‟a in preserving faith, human

soul, progeny, property and mind will be difficult to fulfill in the

state of poverty (Al-Abdin 1997).

CONCEPTION OF POVERTY (CONT.)

These objectives require the provision of basic human

needs so that people may not be obliged to cross the limits

of religion and morality (Al-Qaradawi 1393H).

Indeed, the Prophet (P.B.U.H) linked poverty to unbelief by

saying, “Poverty is almost like unbelief in God”( Abu Na‟im in Al

Hilyah, Al Bayhaqi and Al Tabarani)

Islam looks upon poverty as a religious and social

problem, which pushes a person to lowliness, sin and

crime (Al-Abdin 1997).

That is why the Prophet (P.B.U.H) sought the refuge of

Allah from it by saying “O Allah ,I seek your refuge from

poverty ,insufficiency and lowliness”.(Abu Dawud ,Al Nissa‟I, Ibn Majah

and Al Hakim)

The terms fakr, fakir and plural form fukara are mentioned in

the Qur‟an twelve times. When these verses are examined, it is

seen that two speak of “spiritual poverty.” (The Quran)

The remaining verses are related to “material poverty” and

mean helping, protecting, and sheltering poor people. (The Quran)

In these verses, those who are not rich have material needs and

require other peoples‟ help. Thus, it is seen that the majority of

verses deal with material poverty.

The words for poverty in the hadiths are generally used in the

same way. There are many hadiths related to poverty and the

poor and these hadiths mainly refer to “material poverty” as it is

in the Qur‟an.

POVERTY IN ISLAMIC SOURCES

A group of people called “zuhhad” affected mostly by foreign

cultures such as Iranian and Indian emerged that advocated

withdrawal from food and worldly goods. Later, this current of

thought found a place for itself in the area of tasawuf and

deeply affected the entire Islamic world. (Studies in Islam and the Middle East

journal [SIME], January 2005 by Osman GÜNER)

Islam does not have any negative attitudes towards property;

instead it places great value on prosperity as long as it is used

properly. Again, Islam basically does not see poverty as a

virtue, but as a social anomaly that must be alleviated, and a

situation from which a Muslim should pray to Allah to be

protected from its consequences. (Studies in Islam and the Middle East journal [SIME],

January 2005 by Osman GÜNER)

ISLAMIC UNDERSTANDING OF POVERTY

This understanding has become an important threat to

the political and economic independency of Muslim

communities. (Studies in Islam and the Middle East journal [SIME], January 2005 by Osman

GÜNER)

ISLAMIC UNDERSTANDING OF POVERTY (CONT.)

Poverty can be interrelated to two basic classifications of

poor, which are faqir who are the needy, and miskin who are

the poor, as identified and understood in Islam.

Faqir: someone who can only satisfy less than half of his

basic necessities

Miskin: a poor man who can satisfy half or more of his basic

necessities, but is still below the minimum requirement of

basic necessities required.

(Significance of Islamic Economy Towards poverty Alleviation, Mohd. Ma‟sum Billah)

CLASSIFICATION OF POVERTY

In another classification there are three distinct concepts of poverty:

Absolute poverty: inability to attain a minimal standard of living (WB, 1990a: 26). It, thus, tends to emphasize the notion of subsistence: the attainment of which is necessary for existence, i.e. survival.

Relative poverty: identifies the poor relative to other segments of the society, i.e. relative to a comparator group. Thus, has much to do with the issue of inequality (income and wealth distribution.

Subjective poverty: is a self-defined concept and it reflects the attitude and perception of a person towards what is regarded as minimum to meet basic needs, i.e. it compares “actual income against the earner's expectations and perceptions” (WB, ibid:67).

CLASSIFICATION OF POVERTY (CONT.)

Many different factors have been cited to explain why poverty occurs. However, no single explanation has gained universal acceptance at all. The factors that have been alleged to cause poverty include the following:

State discrimination and corruption. Abuse of public power.

Lack of social integration. Competition instead of cooperation.

Crime.

Natural factors such as climate or environment.

Historical factors, for example imperialism and colonialism.

CAUSES OF POVERTY

CAUSES OF POVERTY

Overpopulation. Note that population growth slows

or even become negative as poverty is reduced due

to the demographic transition.

War, including civil war, genocide, bullying, etc.

Lack of education and skills.

Individual beliefs, actions and choices.

Mental diseases, such as Autism, and

Schizophrenia.

Excessive materialism (www.solarnavigator.net/poverty.htm by Nelson Kruschandl)

http://www.solarnavigator.net/poverty.htm

THE ANTI-POVERTY STRATEGY OF THE WORLD BANK

Though debatable this strategy depends heavily on

reducing poverty through the promotion of economic

growth. The World Bank argues that an overview of

many studies show that:

Growth is fundamental for poverty reduction.

Growth accompanied by progressive distributional

change is better than growth alone.

High initial income inequality is a brake on poverty

reduction.

Poverty itself is also likely to be a barrier for poverty

reduction; and wealth inequality seems to predict lower

future growth rates. (www.worldbank.org/poverty)

In September 1999, the Annual Meetings of the WB and

the IMF saw the development of the notion of “Poverty

Reduction Strategy Papers (PRSPs)”, which resulted from

an agreement that each country must have a nationally-

owned participatory poverty reduction strategy programme

(PRSP) as a basis for all WB and IMF concessional lending

and debt relief. (UN NGLS (2002).)

TOWARDS THE ESTABLISHMENT OF POVERTY

REDUCTION STRATEGIES

The United Nations Millennium Summit in

September 2000 has produced what are known as

the „Millennium Development Goals‟ (MDGs). The

first of the MDGs is to eradicate extreme poverty

and hunger by halving, between 1990 and 2015,

the proportion of people whose income is less than

one dollar a day and the proportion of those who

suffer from hunger. (UN NGLS (2002)


REDUCTION STRATEGIES (CONT.)

For fourteen centuries, however, Islam has been calling on people to fight poverty at all levels via many voluntary and compulsory measures, both financial and non-financial.

In 1996 the Islamic Development Bank (IDB) published its “Strategic Agenda for the Medium-Term: Priorities and Main Operational Aspect” with poverty alleviation and human resource development as two of the key five development themes. This coincided with the declaration of “1996 the International Year for the Eradication of Poverty” by the General Assembly of the United Nations.

The Bank is, therefore, renewing its commitment to support its member countries in achieving their socioeconomic development goals.



.

Only East and South Asia regions (but not necessarily all the

countries in these regions) are expected to reduce poverty

by half in 2015; meaning that all developing regions have

lost momentum in achieving their poverty goals. (THE CHALLENGES

OF POVERTY ALLEVIATION IN IDB MEMBER COUNTRIES Dr. Siddig Abdelmageed Salih 1999)



MUSLIMS AMONGST WORLD’S POOREST

The combined annual GDP of 57 Muslim countries

remains under $2 trillion. America, just by herself,

produces goods and services worth $10.4 trillion;

China $5.7 trillion, Japan $3.5 trillion and Germany

$2.1 trillion. Even India‟s GDP is estimated at over

$3 trillion (purchasing power parity basis).

Muslims are 22 percent of the world population and

produce less than 5 percent of global GDP.

The world‟s poorest countries include many Muslim

countries. (Dr Farrukh Saleem, 2005)

The empirical findings confirm the widely held view

that the magnitude of poverty in the Muslim world is

high, if not the highest in the world. (THE CHALLENGES OF

POVERTY ALLEVIATION IN IDB MEMBER COUNTRIES Dr. Siddig Abdelmageed Salih, 1999)

Even in Islamic Economic system Poverty cannot

be eliminated because there is either:

Unavailability of poverty alleviation strategies

Failure to implement these strategies

WHY POVERTY CANNOT BE ELIMINATED?

These strategies consist of elements, these including:

Economic Growth, Income Distribution, Investment in

human Capital and the development of sociopolitical

institutions and arrangements dealing with the poor.

These elements, although interrelated, could have different

impacts in the long-term and in the immediate and short-

terms, on the sustainable reduction of chronic, transitory

and other types of poverty.

WHY POVERTY CANNOT BE ELIMINATED? (CONT.)

1. Investment in human Capital: Social investments (in education, health and social security) can reduce poverty by improving the productivity and health of all people, particularly the poor.

2. Economic Growth: Reading through the United Nations Human Development Reports, countries that were able to achieve a sustainable reduction in poverty are those that achieved sustained levels of economic growth and development. Notable examples are Korea, Malaysia, and Singapore among others in which poverty has been reduced to below 15%. (ELIMINATION OF POVERTY: CHALLENGES AND ISLAMIC

STRATEGIES ISMAIL SIRAGELDIN*, 2000)


3.Distribution: Development experience suggests that a highly

unequal income distribution makes it harder to reduce poverty (Demery and Walton 1997)

That is, incidence of poverty is a function of both economic

growth and income distribution.

The establishment of an equitable distribution system calls for

certain governmental functions. This will overlap to other factors

such as investment in human capital and development of

sociopolitical institutions.


4. Development of sociopolitical institutions: In the

prevailing political economy of the time, government

role should be conducive to sustaining broad-based

economic growth, equity and social progress.

Poor governance and market failure are two aspects,

which should be properly addressed to attain justice in

the economic activities, which will help in poverty

eradication. (Norbaini bt. Abdul. An Islamic view on poverty : a preliminary study (1993) International Islamic

University, Petaling Jaya)


The institutions of Zakat, sadaqatul fitr, inheritance, waqf

etc. come under this category. In these cases, one has to

dispose one‟s wealth to one‟s fellow-beings whereby have-

nots become better off. Mutual gifts, endowments and

other optional charities, on which Islam places a heavy

emphasis, also reduce the disparity between the haves

and the have-nots of society (Detail information on, Abul Khair Mohd Jalaluddin, The

Theory of Distribution in Islam)


Presentation poverty

Economy & Finance

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