THE HAGUE, 17/07/07 - Finance Minister Wouter Bos announced yesterday in a written answer to Party for Freedom (PVV) questions that he wants to encourage Sharia banking in the Netherlands. PVV MPs Geert Wilders and Teun van Dijck, in fact had asked for a ban on such Islamic banking.

Bos is investigating how the market for Islamic banking in the Netherlands can be developed. "In the first place because Islamic banking meets a demand from the Muslims living in the Netherlands. In the second place because we see an opportunity here for the Dutch financial sector. A third reason is that banning Islamic banking from the perspective of fighting terrorism will have a counter-productive effect. Denial of an actual need can lead to money-flows running via alternative channels out of the sight of the government," he wrote to the Lower House.

Islamic banks who want to offer their services in the Netherlands - or Western banks that want to offer services meeting Sharia principles - must always keep to the laws and regulations that apply to all financial services companies, according to Bos, who is also the leader of Labour (PvdA). "This means that every financial institution must meet the same minimum requirements regarding the integrity of the management, credit-worthiness and transparency."

Dubai and Londen are currently developing themselves into international centres for Islamic banking, Bos stated. "The Netherlands is suited to play a role here too. We have a well-developed and innovative financial sector, good regulations and solid supervisory bodies," said Bos.