How Saudi Arabia is selling the waqf to assist finance world construction
NEW YORK CITY: As governments scramble to near a multitrillion-dollar investment hole threatening the UN’s Sustainable Construction Targets, Saudi Arabia is selling an answer rooted no longer in trendy finance however in a 1,400-year-old Islamic custom.
Presenting its 3rd Voluntary Nationwide Evaluation on the UN Top-Stage Political Discussion board on Sustainable Construction this week, the Kingdom’s Basic Authority for Awqaf argued that the waqf — the Islamic charitable endowment — may just turn out to be an impressive software for financing sustainable construction.
The authority participated as a part of the Saudi delegation to the discussion board, operating July 7-15 in New York, the place 36 nations introduced their VNRs this yr.
For the primary time, the function of endowments and their contribution to sustainable construction has been integrated within the Kingdom’s nationwide overview, in step with Tufeeq Alghamdi, common supervisor of empowerment and construction on the Basic Authority for Awqaf.
The authority arranged a roundtable on the headquarters of the UN Construction Programme to give the Saudi endowment revel in. Alghamdi described the development as an extension of a partnership between the UNDP and the Basic Authority for Awqaf to expand what he referred to as the Endowment Excellence Index, or Waqf Excellence Index.
Saudi Arabia’s Basic Authority for Awqaf arranged a roundtable on the headquarters of the UN Construction Programme to give the Saudi endowment revel in. (UN photograph)
He stated that the roundtable used to be designed to exhibit the transformation that the sphere has passed through within the Kingdom “in terms of governance, development, technological transformation, and enhancing transparency,” in addition to the mixing of endowments into the nationwide construction framework.
The index, Alghamdi stated, is a device to measure the adulthood of endowment establishments that used to be advanced locally however constructed to global requirements, permitting it to be tailored in different places.
He described it as the primary software of its sort to evaluate endowment practices towards global benchmarks, pronouncing it establishes “a common language among endowment institutions for measuring their performance, their level of maturity, and their efficiency,” whilst linking their outputs to the 17 Sustainable Construction Targets and nationwide priorities.
He traced the waqf thought to the earliest centuries of Islamic historical past, calling it “the first model of sustainability known to history, predating the contemporary concept of sustainability and sustainable development.”
Endowments traditionally financed faculties, hospitals and different infrastructure, he stated, and lately can assist deal with investment shortfalls dealing with charitable organizations, in particular in nations with fragile economies, on account of the fashion’s defining function; maintaining a predominant asset whilst maintaining the advantages it generates.
Alghamdi connected the sphere’s expansion to Saudi Imaginative and prescient 2030, which set a goal for the non-profit sector to give a contribution 5 % of the Kingdom’s gross home product.
The Basic Authority for Awqaf, he stated, used to be established as an unbiased executive frame to expand law reconciling the historic and Shariah-based dimensions of waqf with trendy governance practices.
He stated that the Kingdom used to be now situated to percentage its experience with opposite numbers within the Group of Islamic Cooperation and thru broader UN partnerships corresponding to the only with UNDP.
“Our message is that, at a time when many countries are facing challenges in financing development projects … the endowment model stands out as one of the models capable of playing an important role in bridging the global financing gap,” Alghamdi stated.
The apply has a “proven record of success” around the Islamic international that had no longer all the time gained the eye it deserved, he added.
In remarks delivered on the roundtable, Alghamdi laid out the size of the sphere, pronouncing the belongings of Saudi awqaf now exceed SR460 billion ($122.6 billion), with greater than 30,000 registered endowments — together with greater than 600 registered up to now month by myself.
He stated that the Kingdom information some of the best ranges of waqf belongings in keeping with capita globally, at an estimated SR12,647 in keeping with individual.
He described governance as the primary pillar of the sphere’s institutional transformation, pronouncing the authority has reinforced regulatory frameworks and compliance requirements, safeguarding waqf belongings valued at about SR100 billion and convalescing just about SR1.5 billion.
Virtual transformation used to be the second one pillar, he stated, mentioning digital registration and popularity of the waqf’s felony character as enhancements to transparency and information high quality.
The 3rd pillar, institutional construction, is supported in the course of the authority’s Riyadah Heart, which builds skilled requirements for custodians and management in governance, funding and chance control.
Alghamdi stated that research have known greater than 35,000 endower prerequisites spanning 27 fields, with overall spending exceeding SR1.8 billion on spaces together with schooling, healthcare, orphan care, mosque products and services, and Hajj and Umrah improve.
He pointed to fresh programs together with the Well being Endowment Fund, the Environmental Tasks Endowment Fund, Al-Salam Endowment Clinic, college endowments, and housing tasks corresponding to Jood Housing.
The sphere contributed an estimated SR48 billion, or 1.2 %, to Saudi GDP in 2023, Alghamdi stated, with ambitions to boost that to SR78 billion.
He stated that waqf funding budget accomplished a median go back of about 9.74 % in 2024, emerging to twelve.83 % when with the exception of underperforming circumstances, whilst tasks and agreements exceeding SR6 billion had been introduced masking financing, promises, pooled waqf budget and qard Al-hasan — interest-free lending — merchandise.
Alghamdi stated that the inclusion of awqaf on this yr’s VNR for the primary time displays their popularity as a part of the Kingdom’s nationwide construction framework and as a contributor to the UN SDGs.
“This sends a clear message; awqaf are not merely a traditional form of giving, but a modern, governable and scalable instrument for financing sustainable development,” he stated.
He concluded through describing the Saudi revel in as “a platform for cooperation” relatively than a closed fashion, pronouncing that the authority is dedicated to operating with governments, global organizations and different waqf establishments on governance, affect dimension and fiscal innovation.
“We believe the future of awqaf lies in partnerships, transforming national experiences into shared knowledge and scalable solutions that serve communities across regions.”
