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The Social and Economic Implications of Sharia Law 

by 

Sam A. Aluko 

Professor of Economics 

Contribution to the Seminar Organised by the Chapel of Annunciation, Archbishop Vining College of Theology, Akure, Ondo State, on Sunday, 28th November, 1999 

 Introduction 

1. The Governor of Zamfara State, Alhaji Ahmed Sani Yerima, proclaimed and launched Sharia Law on Wednesday, October 27, 1999, at a mammoth rally in Gusau, the capital of Zamfara State. It must be remembered that Zamfara State is one of the newest states [CREATED OUT OF SOKOTO STATE] and poorest of the six states created at the same time as Ekiti State was created out of Ondo State in October, 1996. 

2. His Excellency, Sani Yerima, declared at the said launching of Sharia that it marked a landmark, not only in Zamfara State but also throughout Nigeria which has a 'majority' of Muslim population. He berated the inactivity and docility of the Nigerian Muslims in the past and that the Muslim Ummah in Nigeria had for long been dormant, inactive, and remained in a state of slumber and stupor which had given the impression that the Muslims were a silent majority. The Muslims, Yerima continued, have for long yearned for the freedom to exercise their full rights since the period that they were invaded and colonised by the British. He said that the Muslims only partially achieved victory with Nigeria's attainment of independence in 1960 but that their neglect of planning robbed them of the fruits and practices of the Islamic Order. He declared that he has enthroned Sharia as the acme of the struggles started by the fore-sighted Muslim leaders, particularly the late Sir Ahmadu Bello, the Sardauna of Sokoto, who once proclaimed that the Muslims would not relent until the Koran was dipped in the Lagoon and in the Atlantic Coast in Lagos. It could thus be assumed that the Governor of Zamfara State was merely a forerunner to the real Sharia fundamentalists and that he floated the idea with a view to testing the pulse of the Nigerians of other faiths. 

3. The Christian community across the country and the non-muslim, non-indigenes resident in Zamfara State have sharply denounced the action of not only Sani Yerima but also of the general and whole-hearted support which the action has received from leading Muslims, including the ambassadors of almost all the muslim countries in Nigeria. This is the more so, because to the majority of Nigerians, our muslim brothers had been in control of the political and administrative leadership of Nigeria, and by extension its economic policy direction, for a disproportionate period since Nigeria attained independence in 1960. If inspite of that leadership and control, Yerima now regrets the stupor and the inanity of the Muslims to practise their religion in Nigeria. 

We all have cause to worry. If care is not taken and the likes of Yerima are not checkmated, the fragile but holding peace, harmony and religious freedom that had existed in Nigeria will be in great jeopardy. The "Muslim majority" may be out for a grand design either to Islamise Nigeria or throw it into a religios cataclysm that had wreaked havoc and disintegration in some multi-religious countries in some other parts of the world. We must realise that the Sharia is not just a legal system but also a way of life by which Muslim fundamentalists seek to regulate and control their entire religious, social, political, economic, and cultural actions, interactions and reactions even with non-Muslims. 

4. Governor Yerima has justified his actions with sections under our 1999 Constitution (Sections 6 and 38). He has been supported by eminent Muslim lawyers even among us in South-Western Nigeria and from other states outside Zamfara. Since the Sharia issue has been with us since 1978 and it appears to be growing wings, the time is now for Nigerians to address the issue not only of what other faithfuls consider as threats to their own religion but also by trying to understand the main tennets of Sharia and its cooperant legislations. I intend to concentrate only on the Sharia as it impacts on the economic lives of not only the Muslims but also on those who interact or live with them. 

The Economics of Sharia 

5. Let me begin by quoting two incidents from outside Nigeria. Pakistan was created as an Islamic State out of India in 1947. In 1982, during the Military Regime of General (President) Muhammad Zia-Ul-Haq, the Pakistani entire foreign and domestic trade and its financial system and apparatus were threatend to their foundation by a Sharia court ruling. The Islamic High court judges in Pakistan ruled that a set of laws that sanctioned the charging of interest on loans was invalid because it contradicted the Koranic injunction against usury. It required the secular Supreme Court of Pakistan to upturn the judgement of the Sharia judges. In Afghanistan, the Sharia fundamentalists now forbid women from wearing white socks or high heel shoes, because they are considered sexual lucre. Music remains banned, including casettes in cars. Most forms of entertainment, like movies of any sort, are illegal, and many women, in the name of Sharia, have been prevented from not only pursuing their legitimate occupations and professions but some of them also had been driven to commit suicide, thrown into despair and depression, fled the country or driven back into a mediaeval way of life. 

6. The Afghanistan men may not walk the streets unless and until they grow beard of a particular length as the Sharia says that the bear is "wealth from God" and must be worn. Men will not be awarded contracts or be employed unless they wear beard. Since almost all women are "unlucky" not to be endowed with growing beard, they are automatically and permanently ruled out of the economic benefits from the Government contracts of Afghanistan. 

7. So, what Governor Sani Yerima has started and against which many Nigerians are protesting is the tip of the iceberg. What are to follow if he succeeds and if he spreads his ideology to other states of our country can only be imagined. The Sharia (Islamic) Economic Ethics and Economics are at times draconic and pervading. 

Islamic Economic Ethics and Economics 

8. For upwards of ten years, 1968-80, I had the opportunity to serve as one of twelve consultants to the World Council of Churches in Geneva in an organisation which we named "Advisory Committee on Technical Services (ACTS) which has nobee been renamed "Action by Churches Together (ACT)". The ACTS/ACT tried and continues to try to aid Christian churches worldwide. It was as a member of that organisation that some of us suggested that the time was ripe to intensify dialogues with our brothers and sisters of "other living faiths." One of the most prominent of the faiths is the Muslim faith. We had very close contacts with our Muslim brothers and, today, I have very important Muslim friends across the globe. I learn almost as much of the Koran as I learn and continue to learn about our Christian Bible. So, few Christians are as sympathetic to the Muslim religion as I am. Nevertheless, I never cease to let our Muslim brothers know that in the modern day and age religious fanaticism and the debasement of non-Muslim religious practitioners, including Muslim women, do more damage to the Muslim faith and the the Muslims than ever before. 

The Two-Fold Nature of Islamic Economics 

9. A grasp of the dualism inherent in Islam is essential for the understanding of the ideologcial basis of Islamic Economics and Islamic Economic Order. 

   (a) On the one hand, Islam is a monolithic religion which, like Christianity, is a set of doctrines which are supposed to be binding on the believer. 

   (b) on the other hand, Islam is also considered to be an official state ideology with the Islamic religion establishing the guidelines and the sets of values and thereby providing the legal basis for the entire political, social and economic spheres of the Islamic state. The Sharia regards Islam as a social order, a philosophy of life, a system of economic priniciples, a ruling order to which the Muslim believer must conform. 

10. Muslims cannot, therefore, operate full Islamic law of Sharia, except in an Islamic State. So, Yerima is less than sincere, when, by launching Sharia, he denies declaring Zamfara an Islamic state. If and when the full Sharia Law becomes operational in Zamfara State in January 2000, we must accept that Zamfara has, ipso facto, become an Islamic state within the Federal Republic of Nigeria. Zamfara State would then be similar to when Christians operated a Theocratic State by which its internal contradictions had to cease when the church and state became separate and the "Protestant Ethics" ceased to be the dominant economic ethics of the modern state. The full Sharia advocates are still living in that 14-16th Century period of the Theocratic State. Just as we Christians lost the battle for theocratism to secularism, I have no doubt that the Muslims will more than lose the attempt to re-enact their own form of the Sharia State. 

11. In the wake of the re-Islamisation that increased, especially since the 1970s of Ayatollah Khomeini in Iran, Islam became more associated with the idea that the capitalist and the socialist economic systems are alien to the essence of Islam and that a "third force" needs to be fashioned out, based on the Islamic concept of Justice, Fair Distrubtion of economic resources, property rights, inheritance and the right of "Will" on the death of the muslim. So Islamic economic salvation is being sought through obedience to the old traditional Islamic principles and orthodoxy. Economists have asked, and quite rightly, whether the relative economic backwardness of most of the Islamic countries today is not attributable to their desired to return to traditional, outmoded and impracticable Islamic principles, given the increasing inter-dependence in the world economy and the increasing emphasis on fundamental human rights, particularly of the women vis-a-vis their men folks. 

Basic Principles of Islamic Economics 

12. A major factor hindering the spirit of modern economic development in the countries where Islamic rule is sometimes seen in the Islamic belief in the doctrine of pre-destination, and even in magic which crops up in some Islamic suras of the Koran [Sura 2, line 102; Sura 7, line 117; Sura 10, lines 76-81; Sura 20, lines 37-49], though the highest authority in Islam subordinates magic to the will of God. 

13. The Islamic economic ethics rejects undue concern for materialistic accumulation or excessive profit and is more concerned, or enjoined to be more concerned, with the 'lawful' acquisition of goods according to the principles of reward for work done and the social obligations to his community in the use of his wealth for the community well-being. Whether or not the injunction is obeyed is obvious to us in Nigeria today as well as in the recent past. 

Contents of Orthodox Islamic Economic Thought and Practice 

(i) Direct Taxes 

15. Islam distinguishes between the direct taxation of Muslims and non-Muslims, tax discrimination against non-Muslims being essentially intended to encourage their conversion to Islam. Sometimes, direct levies and taxes, known as Jisyah, which are either a lump sum or a poll tax, are levied on Non-muslims but the amount of the taxes and levies are considerably reduced if and when the tax payers convert to Islam. There are four types of such direct taxes: 

1. Zakat - proportiona tax of about 1/40th of 2 1/2 of income or wealth. 

2. Land and yield taxes from property, 1/20th - 1/10th of value (not specifically mentioned in the Koran.) 

3. Taxation of Mining and Minerals. 

4. Mugataa system - community tax payments. 

(ii) Indirect Taxes 

16. The Indirect Taxes consist of Customs Duties, Consumption taxes and other taxes. Although not all the indirect taxes are provided for in the Koran, import duties can be and are usually levied discriminatingly between Muslims and non-Muslims or between resident Muslim indigenes and Muslim foreigners. For instance, in Iran, during the era of the Sharia fundamentalists, the following import duties were imposed on the value of imports: 

(a) 10% for foreign non-muslims; 

(b) 5% for indigene non-muslims 

(c) 2 1/2 % for Indigene muslims. When the rates rose to 20-30%, pro-rata import duty rates were levied on foreign non-muslim importers, non-muslim indigenes and muslim indigenes. Currently, in Afghanistan, such discriminating taxes are used as instruments of conversion to Islam. 

Credit, Interest Rate and the Bank Clearing System 

17. Trade, money lending and credit financing in return for interest were common in Muhammad times. The prohibition of interest or Riba (from which the Yoruba word 'Riba', bribery) is thus one of the fiercest controversies in Islam. A major reason for this is the definition of interest, established at the time of Prophet Mohammed, and the interpretation to which it was later subjected to by different Islamic scholars. It is tantamount to the discriminatory usury in our Bible (Deuteronomy 23, verse 19, which says that "unto a stranger thou may lend upon usury, but unto thy brother thou shall not lend upon usury.") 

18. Riba, in the sense of interest on credit extended for consumption purposes, like our Biblical interest ban on usury, was strictly forbidden for Muslims. However, if interest, in money or kind, is understood to mean profit rate, then, all recognised schools and all modern educated Islamic scholars, with very few exceptions, consider intereste to be compatible with Islamic Laws of Sharia. A loan constitutes an opportunity cost to the lender who should be compensated for the loss in use of his money. The level of interest (profit rate) is determined by the circumstances of the market and/or the rate of returns on investment. The Muslims do not term it "interest" but "profit-sharing." In commerce too, such profit-sharing is considered legal by Islam. (See Psalm 15, verse 5; Proverbs 28, verse 8 whic condemn usury. However, see Mathew 25, verse 27, Luke 19, verse 23, which seem to approve usury.) However, if the money is sleeping, as in savings or deposit account, no interest should be paid. Thus, fixed interest-bearing securities, say on treasury bills, bonds, commercial papers or deposits overseas, are not expected to yield interest under Sharia. Speculative money investments in the modern stocks and shares are regarded as gambling and are also condemned by the Sharia. 

19. The possibility of creating interest-free banks crops up frequently in recent Islamic economic literature. It forms part of the re-Islamisation measures being propagated or already being adopted by some Islamic countries particularly Pakistan since 1977, inspite of its difficulty to apply and integrate into the normal banking system. 

Property Law and Law of Succession 

20. Property law and re-distribution are two controversial topics in Islamic economics. Private property is basically recognised by Islam in the Koran, the Sunna and the Sharia Law. However, it is subject to certain restrictions regarding the origin of the acquisition of the property and the use of the resultant income. Just distribution is proclaimed, although not between men and women or between male and female heirs to their father's property. Thus, the Koran lays it down that sons get double what daughters receve from inheritance. Not more than 1/3 of a person's wealth may be assigned in advance by means of a Will. According to Sharia Law, such Will is only valid when at least two thirds of the property left behind by the dead Muslim is assigned to charitable causes. A will favouring ony one's heirs is forbidden in the Sharia. 

Distribution and Social Justice in Sharia 

21. Islamic Fundamentalists rightly argue that neither hedonistic and individualistic system of capitalism nor the totalitarian collectivist system of socialism does justice to either the individual or to the community as a whole. The negative impact of large accumulaton of wealth by a few, particularly on the poor and the less privileged sectors of the population and on the less developed countries of the world, is regarded as un-Islamic, unjust and runs counter to Islamic morals and values. It violates the principles of national solidarity and common purpose which are fundamental principles of Islamic teaching. There are social imperatives to which the uses of property are subordinated. The Muslim is thus enjoined to accept restrictions in the individual use of his property in the interest of the common good. The Muslim is expected to give alms to the beggar, to the poor, and to the needy, and subscribe to or provide, according to his ability and means, for the needs of the community. This is why it is often the case that a rich Muslim builds a mosque or mosques for hism community or contributes substantially to social and community purposes. The Sharia conundrum enjoins the Muslim to follow a divine code of social justice that will justify his religious beliefs here on earth and attract for him divine favour in the life hereafter through his good works. Islam not only acclaims the good works by Muslims, it also regards good works as the main justification in the eyes of God and warns that not an iota of good works or mischief will be lost on the day of judgement. In Islam, good deeds earn merit with God, regardless of the religious adherence of their doers. Salvation consists of nothing more than good works, unlike the Christians who believe that not good works but the Grace of God leads to salvation in the life hereafter. 

Conclusion 

22. So long as the Islamic community remained small and its expansion was limited to the Arabian peninsular, and when economic activities were limited to the subsistence level, it was possible to control the entire behaviour of the Muslims along the lines laid down by Prophert Muhammead in the Koran, the Sunna and the Sharia. 

23. As the Muslim empire expanded and its interactions with the world increased, some of the functions concentrated in the religious leaders by these Muslim revelations had to be separated, because neither the caliphs, the Bahs or the Sultans and the kings were capable of wielding complete religious and political power on their own. It became essential to hand over: 

(a) administrative functions to a Prime Minister, Minister, Governor or President; 

(b) Military functions to a Commander-in-Chief; 

(c) Spiritual/religious functions to the Imams, the Ulama and the theologians; 

(d) Judicial matters to Islamic legal officers, many of whom had to apply norms other than those provided only in the Sharia. 

24. As a result, the binding , obligatory interpretation of the Koran and the Sunna along already established principles is no longer tenable, so that their re-introduction in the already mentioned condition of the Ijma remains only an idealistic but impracticable notion. Kemal Attarturk, the founder of modern Turkey, is the ideal leader and hero of the modern Islamic economy. Inspite of the fact that Turkey's population is 98% Muslim, Attarturk recognised secularity as the shortest path to rapid economic development and the protection of the minority Christians and Sikhs in Turkey. Today, Turkey is not only a modern state and the most developed in the Islamic World, it is also integrated into mainland Europe. Similarly, countries like Egypt, Lebanon, Syria, Palestine, Jordan, Kuwait, Tunisia, Iran and Indonesia (the largest Muslim country in the world, of over 200 million people) have, over the years, embraced the virtues of secularity as a principle of governing a multi-religious and plural society. There are no more than 2 countries in the whole world today where strict Islamic laws and the Sharia are the "Directive Principles of State Policy." They are Afghanistan under the Taleban Muslim Movement, and to an extent, the Royal Kingdom of Saudi Arabia, both of which are not multi-religious countries. The attempt to impose Islamic monotheism in Sudan has led to a seemingly endless war between the Muslim North and the Christian South there. 

25. The expanding scope and economic activities of the Islamic empire increasingly make ridicule of any attempt to return to the primordial application of the Sharia Law to regulate and promote the economic affairs of the component states of the organisation of Islamic countries. 

26. In 1972, the Organisation of Islamic Conference (OIC) was established. It consisted of 46 states with the following organs: 

(i) the conference of kings and Heads of States and Governments as the supreme authority, holding a summit every three years; its Headquarters is in Saudi Arabia; 

(ii) the Conference of Foreign Ministers as the main body for the adoption of resolutions of common interest. The Foreign Ministers meet annually or earlier as and when emergencies demand. Its Headquarters is in Saudi Arabia. 

(iii) the Permanent General Secretariat in Jeddah, Saudi Arabia, which prepares the meetings of the OIC and implements its decisions and resolutions. 

The resolutions and the declarations of the OIC require 2/3 majority. They become binding for a member state only after its government has ratified them. 

27. The Organisation of Islamic Conference (OIC) pays special attention to economic issues, for which a special department exists to encourage and ensure closer economic relations among the Islamic countries, with a view to an ultimate creation of an Islamic Common Market. The special Economic Department of the OIC has promoted two major agreements among the OIC member states. 

They are: 

(a) the General Agreement for Economic, Technical and Commercial Cooperation (GAETCC), signed in 1977, and which became effective in 1981, after being ratified by at least half of the OIC members; 

(b) the Agreement for the Promotion, Protection and Guarantee of Investments (APPGI) among member states, signed in 1981 but became effective in 1990. 

28. The other main economic institutions and agenceis set up by the OIC include: 

1. Islamic Commission for Economic, Cultural and Social Affairs (ICESCSA) in Jeddah, Saudi Arabia (1975); 

2. Islamic Development Bank (in Jeddah), (1975); 

3. Statistical, Economic and Social Research and Training for Islamic Countries (SESRTIC), Ankara (Turkey), 1977. 

4. Islamic Chamber of Commerce, Industry and Commodity Exchange (ICCICE), Karachi, Pakistan (1978) 

5. Islamic Centre for Vocational and Technical Training and Research (ICVTTR), Dacca, Bangladesh (1978); 

6. Islamic Foundation for Science, Technology and Development (IFSTAD), Jeddah, 1978. 

7. Islamic Centre for Development and Trade (ICDT), Casablanca (Morocco), 1981; 

8. Islamic Research and Training Institute (IRTI), in Jeddah, 1982; 

9. International Asociation of Islamic Banks (IAIB), Jeddah, 1987; 

10. Islamic States Telecommunications Union (Jeddha), 1988; 

11. Islamic Shipowners Association (Jeddah) 1988; 

12. Islamic Cement Union (Ankara, Turkey), 1990; 

29. Nigeria remains an observer member of the OIC as our national (Federal) Government has not formally ratified the OIC membership protocols. Also, the Islamic Development Bank membership currently stands at 43, because Brunei, Iran and Nigeria are yet to accede to the membership of the Bank. WIth all these multifarious agencies in so many countries and interacting worldwide, the application of the Sharia becomes more and more ridiculous for its impossibility. 

Reforms to Sharia Economics 

30. Three types of reforms are necessry if Islam is to move forward economically. They are: 

1. the enthronement of secular-liberal policies aimed at bringing about a homogeneous and integrated economy and society; 

2. social reform which acknowledges respect for the fundamental human rights of all citizens and the religious freedom and social needs of all citizens, similar to the situations in Iraq, Egypt, Syria, Turkey and Tunisia, Jordan, Kuwait, etc. and 

3. the abandonment of undue radical Islamic fundamentalism of Iran, Afghanistan and Pakistan and which are incipient in Zamfara State. 

There is the vital need to avoid social and political crisis in a multi-religious society where Muslims predominate. Rather, there should be an adaptation to the modern secular demands of the state and its citizens. 

31. The morbid adoption of classical and unlimited Sharia Law by the Zamfara State Government is obviously a journey on the road not only to social disorder and chaos but also to economic stagnation and suicide of the state an an integral member of secular Nigerian nation. All of us should, therefore, appeal to the Government and the people of Zamfara State to limit the exercise of the Sharia Law to what the Nigerian constitution envisages, in order to avoid the ruins of the little progress made in Zamfara State since its creation in 1996. 

32. It is necessary to remind our Muslim brothers that there is not much that is uniquely Sharia that has no counterpart in the Christian Bible. Like the Koran and the other Muslim books, the Christian Bible abhors adultery (Exodus 20:14, Mathew 5:27-28) and even sanctions it with the death penalty (Leviticus 20:10); stealing (Exodus 20:15); drunkenness (Deuteronomy 21; 20-21; Luke 21:34); Homosexuality (Leviticus 20:13); Murder (Genesis 9:6; Exodus 20:13); usury (Deuteronomy 23:20; Psalm 15:5); false witness (Exodus 20:16); lying (Leviticus 19:11; Psalm 31:18); belief in the day of judgement or Hell Fire (Luke 16: 19-25; Mathew 25:31-46); alms giving (Mathew 6:1-4) or fasting (Exodus 34:28; Mathew 4:2). The difference between us and our Muslim brothers is that Jesus Christ came to redeem the Christians from the brutalities of sin from which our Muslim brothers still need to be and should now be redeemed. The Christians believe that they do not live only under the law but also under the Grace of God. 

33. Finally, it is incumbent on modern governments and their religious leaders and supporters to put in place such policies and programmes that will reduce, if not totally eliminate, the vices that are increasingly plaguing our country and our societies. Otherwise, we will be deceiving ourselves by using any legal system or government machineries to fight the consequences rather than the causes of the social and economic vices in our country.

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