Keynote Address by Tan Sri
Dato’ Seri Sanusi bin Junid in The Kuala Lumpur International Conference on
Gold in International Trade: Strategic Positioning in Global Monetary System at
Sheraton Imperial Hotel, Kuala Lumpur on 29th September, 2003
Assalaamu’alaikum
Warahmatullaahi Wabarakaatuh
Chairman of the seminar,
Deputy Governor of Bank Negara
Malaysia,
Secretary General of Ministry
of Foreign Affairs,
Rector of International
Islamic University Malaysia,
Honoured guests,
Fellow participants of the
seminar,
Ladies and gentlemen.
Failure of Bretton Woods
Between August 19th
and 20th, last year, at Putra World Trade Centre (PWTC), Kuala
Lumpur, an international conference was held on stable and just global monetary
system with the theme ‘Viability of the Islamic Dinar’ as a response to the
1997 East Asian economic and financial crisis by which Malaysia was ‘robbed’ of
its economic well-being by the international currency speculators.
The gold dinar, whether Islamic or
not, is propagated by the Prime Minister of Malaysia, the Honourable Dato’ Seri
Dr. Mahathir bin Mohamad . It is simply a gold payment system. This propagation is a reintroduction of the
role played by gold, as money, before the United States President Richard Milhaus
Nixon removed gold backing from the US dollar as there was insufficient gold
belonging to the United States to back up the dollars needed to finance the Vietnam
war. It was either an admission of the failure of the Bretton Woods’ system to
support the us or just the arrogance of Nixon and his close advisors, in not
wanting to use the system.
East Asia Economic Congress
Between the 4th and
the 6th of August this year an international congress was held again
at the Putra World Trade Centre where delegates from East Asian countries
unanimously agree that there is a need for an East Asian fund to assist
countries which are in financial or economic problems or crisis. This implies a
prevailing distrust in the present economic system entrusted to the Bretton Woods
institutions.
Young Muslim Leaders Conference
After that, between the 14th
and 16th of September, representatives from sixty nations attended
an international conference of young Muslim leaders held at the Renaissance
Hotel, Kuala Lumpur where a resolution
was passed to create a world Muslim economic foundation. This again proved that
there is an overall discomfort, even among the young, on the economic plight of
Muslims all over the world.
The above three events were
all officiated by the Prime Minister of Malaysia.
Our seminar today would have
been graced by him too had he not been called to another unavoidable event
sandwiched between his busy schedule overseas and the launching of the Langkawi
International Maritime and Airshow
Gold in International Trade (GIT)
This seminar zeros into specifics.
It is a seminar on ‘Gold in International Trade’ or GIT. With this seminar and
previous seminars and conferences on related subject, our mind would have been
prepared for the Organisation of Islamic Conference Summit next month.
Today we are gathered again to
discuss the implementation of the gold payment system in international trade.
Historically, gold has held
its value stable compared to any fiat currency. It was Roy Jastram, in his book
“The Golden Constant” who showed that prices based on gold were relatively
constant for 400 years.
Although at other forums we
used the term ‘Islamic gold dinar’, we have excluded the words ‘Islamic’ and ‘dinar’
in the terminology for this forum, with the intention of removing the stigma
and prejudice against gold. There was of course the Iraqi dinar before the fall
of Saddam, although the Kuwaiti dinar is still in use. Hopefully the omission
of the two words will remove the prejudice on gold, due to Western propaganda
against Islam, thereby blurring their vision against a valuable commodity which
can solve or minimise the world economic problems.
It must however be remembered
that the word dinar is derived from the Latin word denarius which was the Roman Byzantine gold coin circulating among
the Arabs during the time of the Prophet Muhammad s.a.w. It is therefore of
western origin.
The dinar, equivalent to 4.25
grams of 22 carat gold (91.6 per cent gold alloy) remained the monetary unit
for Muslims until the collapse of the Ottoman caliphate in 1924.
