(Reuters) - The government of Malta has established a national body to help drive the development of Islamic finance with further plans for legislation to facilitate the sector as the country aims to attract business from Middle East firms.
Malta, the smallest European Union nation, is trying to position itself as a hub for Islamic finance firms.
The Malta Islamic Finance Association would help coordinate efforts across national agencies, regulators and other standard setting bodies, said Silvio Schembri, parliamentary secretary for financial services, digital economy and innovation.
“As a government we will be looking at drafting amendments to our legislation that will permit Islamic financial institutions to benefit from stronger links with EU member states, amongst other opportunities.”
Islamic finance, which prohibits interest payments and pure monetary speculation, is estimated to total more than $2 trillion of assets globally and is offered across markets spanning the Middle East, Africa and Southeast Asia.
There have been previous efforts to attract Islamic finance into Malta, including an Islamic equity index launched by the Malta Stock Exchange in 2016.
Malta’s financial regulator also issued a guidance note on Islamic investment funds in 2011, the first EU member country to do so.
Reporting by Bernardo Vizcaino; Editing by Eric Meijer