KHALID ALYAHMADI– CEO, Muscat National Development and Investment
Company (ASAAS) and Chairman, Amjaad Holding
Khalid Alyahmadi is the Chief Executive Officer of Muscat National Development and Investment Company (ASAAS) and the Founder and Chairman of the Amjaad Group of Companies. After obtaining his bachelor’s degree in engineering from King Faisal University, Saudi Arabia, Mr Alyahmadi worked for some of the top engineering firms in the Middle East. However, his deep interest and endless efforts to promote Islamic banking in Oman have driven him to found and organize the first-ever Oman Islamic Economic Forum in 2011. The event was not only a huge success but paved the way for the development of a vibrant Islamic banking and finance industry in the Sultanate of Oman.
Hailed as one of the most influential young business leaders, Mr Alyahmadi is a strong advocate of Islamic finance and continues his relentless pursuit of promoting and developing Islamic banking and finance in Oman. Although Islamic banking is still in its infancy, Mr Alyahmadi believes it has great potentials to propel the Oman economy to a higher level of development. In this exclusive interview, Mr Alyahmadi shares his vision of developing Oman as a regional centre of excellence in Islamic finance and the Sultanate’s leadership role in the continued development of the global Islamic finance industry.
Please tell us about Khalid Alyahmadi, the entrepreneur. When did you actually know that you had an entrepreneur hiding inside you?
Khalid Alyahmadi: Before founding Amjaad back in 2006, I was in employment for a number of years. It was during this time that the reality of working life hit me. Much to my dismay I soon realized that many employers do not value their employees nor treat them well. More often than not employers fail to give due recognition to employees for their hard work and contribution to the company’s bottom line. Lack of recognition and less than adequate financial compensation are two main reasons for many employees to get frustrated. I wasn’t an exception. As a hard-working young man, I thought I would be better recognised earning more adequate sums if I started my own business. Right from the beginning I have tried my best to recognise my employees’ contributions and reward them accordingly.
As founder of Oman Islamic Economic Forum (OIEF), you put Muscat on the global map of Islamic banking and finance. How did you come about with this idea and in your views, what has been the real impact of OIEF on the national landscape of Islamic banking and finance?
Khalid Alyahmadi: I come from a family who practice strict adherence to Shari’a principles. This includes avoiding any dealings that are deemed to be non-Shari’a-compliant. Hence, my family background and my upbringing formed the basis of my life, my personality and my passion for Islamic banking and finance. Before 2011, Oman had no Islamic banks. A businessman, like myself, who does not want to deal with riba, found himself at a crossroad. How do we grow our business but still remain true to our religious beliefs and values? The absence of Islamic banking services in the country at that time was mainly due to numerous misconceptions on part of different stakeholders, about the relevance of Islamic doctrines governing commercial activities.
The idea to organize the Oman Islamic Economic Forum came one morning sometime back in 2011 when I was checking my email. I was pleasantly surprised and excited to have received an invitation to the Word Islamic Finance Conference in London. That email struck a chord and prompted me to wonder why London was chosen as a venue for a conference in Islamic banking and finance when the city is not regarded as a major hub for Islamic finance unlike the GCC and Malaysia. To quench my curiosity, I decided to attend and was overwhelmed by the quality and transparency of discussions. It helped me have a greater understanding of some of the issues and challenges facing Islamic banking. It was a real eye-opener! I realized that creating an understanding and awareness about Islamic banking amongst the Omani government and the general public was the way forward for the development of Islamic banking and finance in my country. And this could be achieved by organizing a special forum that brings together leading practitioners, prominent heads of state, opinion-making academicians and other important stakeholders to discuss ways in which Islamic finance dealings can have a positive effect on the Omani economy specifically and the global economy generally.
The idea to organize the Oman Islamic Economic Forum came one morning sometime back in 2011 when I was checking my email. I was pleasantly surprised and excited to have received an invitation to the Word Islamic Finance Conference in London. That email struck a chord and prompted me to wonder why London was chosen as a venue for a conference in Islamic banking and finance when the city is not regarded as a major hub for Islamic finance unlike the GCC and Malaysia.
It was during this time that I had the privilege of meeting Professor Humayon Dar, who showed much support and interest in my idea. After much discussion and brainstorming, we agreed to jointly organize the conference and named it Oman Islamic Economic Forum or OIEF for short. The event, which was the first of its kind in the Sultanate and the region, was very successful and had attracted more than 500 delegates from different parts of the world. I am proud to say that OIEF achieved positive results of fostering greater understanding and appreciation of Islamic banking and finance in Oman. Undoubtedly, it paved the way for the development of a vibrant Islamic financial industry in the country. His Majesty Sultan Qaboos bin Said had ordered an extensive feasibility study into Islamic banking in Oman. Subsequent to this, a Royal Decree amending the banking law and the legal authorisation for Islamic banking was issued in May 2012 and this followed suit with release of the Islamic Banking Regulatory Framework by the Central Bank of Oman in December of the same year.
As the CEO of Muscat National Development and Investment Company (ASAAS), what is your main role? What are some of the real challenges you face in discharging your responsibilities? Please share with us about ASAAS and its mission and philosophy.
Khalid Alyahmadi: ASAAS was formed in 2014 by the State General Reserve Fund of the Sultanate of Oman, Muscat Municipality and 8 pension funds from both the government and private sector. Our aim is to become one of the main development and investment arms for the government and pension funds in the country. Hence, ASAAS’s mandate is founded on identifying new investment opportunities and intelligent solutions that meet public needs to enrich the quality of life of people in Oman. This in itself is a huge mandate! ASAAS’s business model revolves around collaborating efforts with different public and private sectors in areas such as tourism, logistics, healthcare, education and retail, thus contributing to the diversification of the national economy.
Hence, at ASAAS, our vision is “to contribute in upgrading the quality of life in Oman with a commitment to generate a sustainable economic return”. To this effect, our mission is “to initiate, collaborate and deliver businesses that will improve the general well-being of the community in Oman as well enhancing shareholders value and contribution to the diversification of the national economy”. We, my colleagues and I, are trying to build a solid organization that can be an economic pillar for the Omani economy in the longer term. As we celebrate our first year in operations and about to kick start our first project, we are blessed with the right team that shares ASAAS’s vision and mission.
How is Oman different from other countries in the GCC? Do you think that Oman can become an agent of change in the regional Islamic financial services industry?
Khalid Alyahmadi: Of the 4.2 million population in Oman, Omani citizens constitute about 55%. This is different from other GCC countries. Based on several surveys carried out on the demand for Shari’a-compliant financial products in Oman, there is strong evidence to suggest that Omanis prefer to conduct their financial affairs in accordance with Shari’a. We have seen that Islamic banking has been embraced with fervour by the people of Oman – a clear evidence of the demand potential for more Shari’a-compliant financial products and services.
Although Oman is a relative latecomer to Islamic banking, the industry is expected to grow rapidly over time. This is attributable to several key drivers including a fast-growing economy, diversification of the economy from dependence on oil and gas, and the Sultanate’s young population.
In my views, the main challenge facing the Islamic banking and finance industry is human capital. We need more qualified leaders and professionals in the industry with both Shari’a knowledge and banking experience with international investment exposure. I believe that having quality talent is a pre-requisite not only for the development of the industry but also for its long-term sustainability. The government should play a key role as the enabler in developing qualified professionals in Islamic finance.
You happen to be a vivid user of social media. What role can social media play in creating awareness around Islamic economics, banking and finance?
Khalid Alyahmadi: Social media is indeed a powerful tool and as such, can be used for raising awareness about Islamic economics, banking and finance. From my observations, Islamic financial institutions are using social media as a marketing tool but with no clear vision and mission. I believe that they need to take a back-to-basics approach with a focus on the fundamentals of Islamic economic system. Islamic financial institutions should be more active in raising zakat, which is a mandatory deed; as well as setting up endowment funds or awqaf to support education and healthcare. Focus should also be more in investment banking. Another important role that Islamic financial institutions can play through social media is promoting the true spirit of Islam as a religion of peace and justice.
You have invested in the US and have for some time been actively involved in some of the community development projects therein.
What is your view on the Muslim communities living in Muslim- minority countries like the US and UK?
Khalid Alyahmadi: I honestly believe that Muslims in the US and UK are given fair treatments and are treated as equal citizens regarding their rights and freedom. Most of those Muslims living in the US and UK don’t have similar quality of life or equal rights back in their home countries. Muslim communities in Muslim-minority countries have better appreciation for collaborations and are great proponents of peaceful co-existence.
On a lighter note, where do you feel most comfortable and what makes you happy?
Khalid Alyahmadi: I am always happy and thankful; but more so when I am helping people and making them happy!
Would you disagree to the view held by many Muslims that Islamic banking and finance has failed to achieve its objectives in terms of poverty alleviation and contribution to economic development?
What can be done to make Islamic banking and finance more sensitive to the needs of Muslim communities around the world?
Khalid Alyahmadi: We are still at the starting point. Objectives are not yet well defined and there is no common business plan. All parties must and should do much more. Like any other community, high-quality education is very important. And this should be made accessible and affordable for learners of all ages, irrespective of class, status, creed, colour and language. The Islamic banking and finance community should put greater focus on this agenda.
I would also like to see Islamic banks taking on higher risks in providing more financing and investment products. Islamic banks need to demonstrate their ability to be more innovative in terms of product development and provision of services, especially in providing tools and products to attract foreign funds.
What are your thoughts on the current developments of Islamic banking and finance, both in Oman and globally? Why Islamic banking and finance remains the least developed market segment even in many Muslim countries?
Khalid Alyahmadi: The world today is facing multiple economic and social issues. Wealth distribution is still extremely top heavy while the number of people living in poverty has actually increased in recent years. The strong support from the government has propelled Islamic banking and the economy of Oman to a higher level of development. There has been robust growth in recent years with Islamic banking now accounting for 6.3% of the total banking assets in Oman, compared with 5.3% in 2014 and 3.6% in 2013. But finance is only one element of an economic system. We need to have a complete ecosystem for Islamic finance to thrive further and this process must be well coordinated between both political and financial authorities.
What are future plans of Amjaad Holding? Where do you see the company in the next 5 years?
Khalid Alyahmadi: Amjaad has been growing consistently since it was set up in 2006. We started with only a capital of US$20,000. Today we are a holding company with a turnover of US$15 million and we expect to double this figure by 2020. Our primary focus is in real estate development, asset management services including financing arrangement.
Please share with the readers a typical day of Khalid Alyahmadi, how it starts and what are the important daily items or tasks on your to-do list.
Khalid Alyahmadi: I try my best to go to the mosque every morning to perform my fajr prayer and then recite a few pages of the Quran. When I am able to do this, my day is without a doubt a better one! After coming home from the mosque, I help my wife prepare our kids for school. I typically start my working day at 8 am and depending on the day’s schedule I sometimes work until 7 pm. After work I would alternate between visiting my parents, meeting some friends, getting some work done at home or spending time with my children – the latter is always my priority.
Family or Country? Which one should come first?
Khalid Alyahmadi: Both; achieving a balance is important!
