Practical Means of Integrating Zakat and Waqf into the Poverty Reduction Agenda of OIC Member Countries

The prevalence of widespread poverty is one of the most serious challenges confronting the world today. The intensity of the problem in developing countries, mostly OIC member countries (MCs), is more severe. The developed nations of the world have succeeded overtime to provide social protection to their masses by launching a variety of welfare programs. Unfortunately, similar social security measures either do not exist or do not work efficiently in the developing countries. Thus, the problem manifests in its full bloom, which in turn leads to instability and growth of numerous social evils in these countries. Different policies and strategies have been adopted in different countries in the past to reduce poverty, but the fact remains that poverty persists especially in the OIC member countries. Muslim countries inherited very strong institutions of zakāt1, ṣadaqat (charities) and waqf for fighting against poverty. In the past, these institutions were used very successfully for the rehabilitation and welfare of the poor (Shirazi, 1994). Unfortunately, Muslim countries have largely neglected these institutions, and they consequently fail to utilize the potentials such institutions could have in containing poverty. Few IDB member countries (Yemen, Saudi Arabia, Bangladesh, Indonesia, Malaysia, Libya, Pakistan and Sudan) have introduced the system of zakāt, which, however, is different in terms of coverage of zakātable items and assets. Other countries have not introduced this system, and in such places zakāt is considered as a private affair. It is a fact that Muslims are paying their zakāt on their own to the poor and to different charitable institutions. However, these transactions do not pass through proper channels, and are unrecorded, unplanned and not a part of any strategy. Therefore, one cannot asses the effectiveness of zakāt in poverty alleviation. The same is the case with the institution of awqaf. These institutions need to be revived, properly organized and planned such that they could help in providing additional source of revenue to governments for the social welfare of the society, and need to be integrated in the overall poverty reduction strategy of the MCs.