Identifier
Created
Classification
Origin
06KIGALI489
2006-05-22 15:05:00
UNCLASSIFIED
Embassy Kigali
Cable title:  

REACHING OUT TO THE RWANDAN MUSLIM COMMUNITY

Tags:  EFIN EINV ODIP SCUL RW 
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VZCZCXYZ0001
RR RUEHWEB

DE RUEHLGB #0489 1421505
ZNR UUUUU ZZH
R 221505Z MAY 06
FM AMEMBASSY KIGALI
TO SECSTATE WASHDC 2795
UNCLAS KIGALI 000489 

SIPDIS

DEPT FOR AF/C AND AF/EPS
DEPT FOR USAID FOR AFR/EA, PPC, AND AFR/SD

SIPDIS

E.O. 12958: N/A
TAGS: EFIN EINV ODIP SCUL RW
SUBJECT: REACHING OUT TO THE RWANDAN MUSLIM COMMUNITY


UNCLAS KIGALI 000489

SIPDIS

DEPT FOR AF/C AND AF/EPS
DEPT FOR USAID FOR AFR/EA, PPC, AND AFR/SD

SIPDIS

E.O. 12958: N/A
TAGS: EFIN EINV ODIP SCUL RW
SUBJECT: REACHING OUT TO THE RWANDAN MUSLIM COMMUNITY



1. On May 13, Ambassador attended the opening ceremony of Al-
Halaal Micro-Finance Institution, a new private financial
credit company established consistent with Islamic banking
principles. The Ambassador's participation was part of
post's continuing effort to reach out to the Muslim
community, which has also included developing a good working
relationship with the Mufti of Rwanda and with the
predominantly Muslim political party, Parti Pour la
Democratie Ideale (PDI). Also in attendance were the
British Ambassador, the Libyan Charge, the Minister of
Internal Security, and a Parliamentarian. The guest of
honor was the Minister of Finance and Economic Planning,
James Musoni, who underscored the government's support of
the Muslim community and the importance of institutions such
as Al-Halaal that provide Rwandans much needed access to
capital.


2. Al-Halaal started banking operations in February, and
currently has 10 employees and 615 customers, and has
already extended over 12 million Rwandan Francs (around USD
22,000) in credit. Its mission is to assist customers to
access credit on easier terms than available from
traditional banks and to create a vehicle by which to spur
development within the Muslim community. The new bank is
capitalized entirely by members of the Rwandan Muslim
community.


3. Al-Halaal's banking operations are guided by Islamic
law, which prohibits the collection and payment of interest.
It also prohibits trading in financial risk and investing in
businesses that sell alcohol or pork, or businesses that
produce un-Islamic media. Instead of collecting interest,
Islamic banks offer financing on a profit and loss sharing
basis. With equity financing, losses are shared by the
financier along with the entrepreneur based on the ratio of
their respective capital invested. The profits, however,
are distributed according to a pre-negotiated agreement with
the investors. Thus, while officially licensed under the
Rwandan Central Bank, Al-Halaal operates more like a private
equity fund than a depository institution like other banks
in the country. Depositors are essentially putting funds
into a pool that they hope will appreciate.


4. COMMENT: While Al-Halaal and its Islamic banking
principles are a first in the region, Islamic banking is
managing up to an estimated USD 200 billion worldwide. The
opening of Al-Halaal is a good example of Rwanda's efforts
to take new initiatives that can serve as a model for the
region. The presence at the opening of a high-level
government minister demonstrated the GOR's support for the
historically marginalized Muslim community. The Muslim
community appeared to be extremely appreciative of US
Embassy's outreach to the Muslim community.


ARIETTI