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Archived Articles
Simeon Mitropolitski is a Canadian analyst, of Bulgarian origin, and a former syndicated columnist with the Bulgarian News Agency (BTA). He is the author of several hundred articles dealing with hot political and economic topics, both national and international.
He was part of the first group of Bulgarian intellectuals and students that began the opposition movement that finally put an end to the communist regime in this country in 1989, and in 1996-1997 participated in international observation teams during the elections in several Balkan countries - Romania, Albania and Bulgaria.
In 2002 Simeon and his family moved from Bulgaria to Canada where they live now in Montreal, province of Quebec. Simeon is a Master of Political Science from McGill University and a B.A. of Political Science and History.
Global Real Estate Project
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Growing Muslim communities and bankingThe Muslim population is growing fast in almost all developed Western societies. A byproduct of this trend is the emergence of community of potential real estate customers with special and often negative attitudes toward some 'traditional' financial instruments like interests and insurance. One way of integrating these new customers will be to wait until they change their attitudes and accept the Western way of doing business, meaning to wait until they become less Muslim. Another way is to adapt the financial institutions to their particular needs. The latter may sound like a big concession but in reality the move isn't so radical. Most data shows that Muslim communities are on the rise in almost all Western liberal democratic countries (Table). These numbers are expected to double or even to triple by 2020. For example, in Canada the number of Muslims is expected to reach 1.4 million by 2017. This trend may lead to many consequences, political, social, economic and cultural. What's important to us here is to look at the consequences it may have on the real estate market. The question of interest is how to handle the problem that may occur when this new population enters the real estate market, a market managed by rules that have a different cultural background*. For those born recently in the West with Christian cultural background it may seem that the current financial system is based on neutral and rational rules taken from the economics textbooks. In fact, however, all that we have has gradually developed for centuries from the Western cultural norms, especially from the Christianity and the Judaism. What about the 'interests' we pay on our borrowing? It may seem so rational that nobody will lend money without expecting some profit, but should the financial profits be always associated with interests? Islam has a problem with this financial instrument, and so should have problems all those who believe in this religion. Considering the fast growing Muslim communities in the West and the long-established Western tradition to integrate (or assimilate) the newcomers, the seemingly easiest solution will be to wait until this community becomes much less religious and accepts the 'Western' way of life and banking. Some people coming from Muslim family background has already made such move, so the advocates of this solution may expect to see more people making the same decision in the years to come. Another solution of making more and more Muslims regular real estate customers will be to adapt the financial system to their cultural needs. This change may be much less radical than many would expect, and of course it has much less to do with the bank employees' dress code than with the techniques used to provide the population with money. Instead of lending money with some interest, the banks may buy the property and resell it to the buyer with some profit. There are some banks in the Middle East that operate for decades according to the Muslim religion and it seems that nothing obstructs their Western counterparts to do the same thing in order to bring more clients. Actually the biggest Western banks are already operating under Islamic banking laws in many predominantly Muslim countries. In some of these countries these Western banks hold dominant market positions. The next logical step for them will be to follow the move to West of millions of Muslims and diversify their financial tools at home. Or to wait until most of them become less religious, which may or may not become a reality. * - An old Arab proverb says that the house is the first thing a man should buy and the last he should sell, because the house is his castle on this side of heaven.
Table (all numbers are from 2001).
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