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A touch of diplomacy needed in this Islamic finance dispute

09 July, 2017      24

 

 

The diplomat Richard Holbrooke, who was probably most famous for his role in bringing the 1990s Balkan crisis to an end, wrote in his memoir The Unquiet American that failures were often more important than successes in his career.

“In diplomacy, as in life,” he wrote, “failures illuminate paths and pitfalls to be avoided”.

The dispute between the Sharjah-based company Dana Gas and its sukuk investors is hardly on a geopolitical scale but Mr Holbrooke’s aphorism holds just as true for the situation the two sides find themselves in.

This is especially the case when seen in the broader context of the world of Islamic finance because there is no getting around the fact that the Dana Gas saga is something of a blot on the copybook for such financing in this part of the world. The question is: how might it illuminate a way forward.

The first thing to recognise is that a bitter court battle would serve neither side.

Despite the fact that the various parties were in court together for the first time early last week - in the English High Court in London on July 5 - the company and the sukuk holders’ representatives seemed to agree by the end of the week that it was best to try and take the heat of the situation.

 


Original Source: https://www.thenational.ae/business/comment/a-touch-of-diplomacy-needed-in-this-islamic-finance-dispute-1.408041


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