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THE ROLE OF OIL WEALTH IN ECONOMIC DEVELOPMENT IN THE LIGHT OF MAQÓØID
AL-SHARÔÑAH: A CASE STUDY OF PETROLIAM NASIONAL BERHAD [PETRONAS]
BY
MOHAMMED ZAINUL ABIDEEN
A thesis submitted in fulfilment of the requirement for the degree of Master in Islamic Revealed Knowledge and
Heritage (Fiqh and UÎËl al-Fiqh)
Kulliyyah of Islamic Revealed Knowledge and Human Sciences
International Islamic University Malaysia
JUNE 2013
ii
ABSTRACT
Oil is considered one of the most important natural resources; it has become the
backbone of modern civilization and appears to be a strategic commodity for each and
every country. Whoever controls this commodity and its industry possesses huge
power. Consequently, oil history is the history of struggle among the big powers
competing for areas of influence. Looking at the importance of oil and its significance
in our life, the big question naturally emerges as to who should own this commodity,
an individual or local communities or private company or state? The study aims to
examine the position of oil in the Qur‘Én, ÍadÊth and the classical and modern fiqh and
determines the ownership of oil in the light of MaqÉÎid al-SharÊÑah, and highlights the
relationship between oil wealth and economic development indicating how to take the
advantage of this resource to achieve economic development. In addition, it takes a case
study of Petronas a wholly state-owned petroleum company, to examine its
contributions towards Malaysia’s economic development in the light of MaqÉÎid
al-SharÊÑah, employing inductive and analytical methods. The study concludes that the
ownership of oil should be given to the state to regulate its wealth and utilize it for the
betterment of the country. Moreover, the study reaches to the conclusion that Petronas
has met most of the MaqÉÎid al-SharÊÑah (the objectives of SharÊÑah) in terms of
economic development and distribution of oil wealth.
iii
خلاصة البحث
النفط على الصعيدين العالمي والمحلي، يتبادر إلى الأذهان لأهميةنظرا
أللأفراد بحكم كونهم عطى حق ملكية هذا الذهب الأسود؟ لمن ي تساؤل مهم:
حكومات المحلية )الدولة(؟ ومن هنا للالتي يقع النفط فيها، أم قاطني المنطقة
هدف الدراسة والمتمثل في محاولة تحديد ملكية النفط. إلى جانب يبرز
محاولة الوقوف على دور النفط في التنمية الاقتصادية الإسلامية في ضوء
شركة بتروناس فضلا عن اتخذت هذه الدراسةمقاصد الشريعة الإسلامية،
ها في مدى مساهماتعن للبحث بوصفها نموذجا للدراسة التطبيقية، الماليزية
التنمية الماليزية في ضوء مقاصد الشريعة. وقد توصلت هذه الدراسة إلى
على الأدلة الشرعية، وانطلاقا من بناء: جملة من النتائج لعل من أهمها
هداف التي تتوخى مقاصد الشرعية تحقيقها للمجتمع والفرد على حد الأ
ي ستعمل ومن فضلية ملكية الدولة للنفط، والتأسواء، توصل البحث إلى
توصلت و على تنمية المجتمع وتحقيق الرفاهية للأفراد. عائدتهخلال
مع مقاصد الشريعة تتطابقالدراسة إلى أن مساهمات شركة بتروناس
وعدالة توزيع عائدات مدخول النفط التنمية تحقيق الإسلامية من حيث
.الماليزي بين أفراد المجتمع
iv
APPROVAL PAGE
I certify that I have supervised and read this study and that in my opinion, it conforms
to acceptable standards of scholarly presentation and is fully adequate, in scope and
quality, as a thesis for the degree of Masters of Human Sciences (Fiqh and UÎËl al-
Fiqh)
………………………………….
Mohd Afandi Awang Hamat Supervisor
………………………………….
Khaliq Ahmad Co Supervisor
I certify that I have read this study and that in my opinion it conforms to acceptable
standards of scholarly presentation and is fully adequate, in scope and quality, as a
thesis for the degree of Masters of Human Sciences (Fiqh and UÎËl al-Fiqh)
………………………………….
Examiner
This dissertaion was submitted to the Department of Fiqh and UÎËl al-Fiqh and is
accepted as a fulfilment of the requirement for the degree of Masters of Human
Sciences (Fiqh and UÎËl al-Fiqh)
………………………………….
Head, Department of Fiqh and
UÎËl al-Fiqh
This dissertation was submitted to the Kuliyyah of Islamic Revealed Knowledge and
Human Sciences and is accepted as a fulfilment of the requirement for the degree of
Masters of Human Sciences (Fiqh and UÎËl al-Fiqh)
…………….……………………
Dean, Kuliyyah of Islamic
Revealed Knowledge and
Human Sciences
v
DECLARATION
I hereby declare that this dissertation is the result of my own investigations, except
where otherwise stated. I also declare that it has not been previously or concurrently
submitted as a whole for any other degrees at IIUM or other institutions.
Mohammed Zainul Abideen
Signature…………………………………. Date………………………………
vi
INTERNATIONAL ISLAMIC UNIVERSITY MALAYSIA
DECLARATION OF COPYRIGHT AND AFFIRMATION
OF FAIR USE OF UNPUBLISHED RESEARCH
Copyright © 2013 by International Islamic University Malaysia. All rights reserved.
THE ROLE OF OIL WEALTH IN ECONOMIC DEVELOPMENT
IN THE LIGHT OF MAQÓØID AL-SHARÔÑAH: A CASE STUDY PETROLIAM NASIONAL BERHAD [PETRONAS]
I hereby affirm that The International Islamic University Malaysia (IIUM) holds all
rights in the copyright of this Work and henceforth any reproduction or use in any
form or by means whatsoever is prohibited without the written consent of IIUM. No
part of this unpublished research may be reproduced, stored in a retrieval system, or
transmitted, in any form of by means, electronic, mechanical, photocopying, recording
or otherwise without prior written permission of the copyright holder.
Affirmed by Zainul Abideen
…………………………………. ………..…………….
Signature Date
vii
I would to dedicate this thesis to my beloved parents for their unconditional love and
supports; both financially and emotionally throughout my life. I do not have words to
express my thanks except what AllÉh has commanded “My Lord, bestow on them your
mercy as they did bring me up when I was young.” (17:24). There is no doubt in my
mind that without their support I could not have completed this degree.
I also dedicate my thesis to my mentor and role model Maulana Khalilur
Rahman Sajjad Nomani, whose encouragement, guidance and support till to date
enabled me to complete this work.
viii
ACKNOWLEDGEMENTS
First and foremost, My heart-felt gratitude goes to my supervisors; Dr. Mohd Afandi
Awang Hamat and (Co-Supervisor) Prof. Dr. Khaliq Ahmad who endured, with all
patience and sincerity, the responsibility of academic supervision of this research.
They helped me with their valuable suggestions and guidelines. With their thorough
intellectual and academic support, finally I could be able to produce this thesis.
I would like to thank Dr. Muhammad Arif Zakaullah for suggesting this topic
as a fruitful subject for research.
My sincere thanks also go to sister Azhar Hadi Fathdil who has been very
generous in her support, ideas, feedback and advice that supported me all the way
since the beginning of my studies. May Allah reward her.
And I shall not forget to thank the International Islamic University-Malaysia,
which granted me the opportunity to further my studies. I am also very much thankful to
the Librarians and other staff of Baitul Hikmah Library of IIUM for providing me
with the necessary materials needed for this research.
I want to thank my wife for her sacrifices, assistance, tolerance, and
enthusiasm that made it possible for me to study.
I pray to Allah SWT for His mercy upon all of those, who provided me any
kind of the support by any means during the period my doctoral thesis was drafted.
ix
TABLE OF CONTENTS
Abstract ................................................................................................................... ii
Abstract in Arabic .................................................................................................... iii
Approval Page .......................................................................................................... iv
Declaration Page ...................................................................................................... v
Copyright Page ......................................................................................................... vi
Dedication Page ....................................................................................................... vii
Acknowledgements .................................................................................................. viii
List of Tables ........................................................................................................... xiii
List of Figures .......................................................................................................... xiv
List of Abbreviation ................................................................................................. xv
CHAPTER ONE: COUNTORS OF THE SUBJECT ....................................... 1
Introduction ................................................................................................. 1
Problem Statement ...................................................................................... 3
Justification of the Study ............................................................................. 4
Research Questions ..................................................................................... 4
Objectives of the Research .......................................................................... 5
Significance of the Study ............................................................................ 6
Research Methodology ................................................................................ 6
Literature Review ........................................................................................ 7
Organization of the Study ........................................................................... 17
CHAPTER TWO: OIL IN PAST, PRESENT AND IN ISLÓM ....................... 18
Introduction ................................................................................................. 18
Definition, Characteristics and Origin of Oil .............................................. 18
The Origins of Oil ....................................................................................... 20
Oil in the Past .............................................................................................. 22
Present Day Oil ............................................................................................ 29
Bases of Oil and its Ownership in Qur‘Én and Suannah and Jurisprudence 31
Oil in Qur’Én ............................................................................................... 32
Oil in Sunnah ............................................................................................... 34
Oil in Islamic Jurisprudence ........................................................................ 34
Meaning of Ownership ................................................................................ 35
The Right of Ownership .............................................................................. 36
Definition of Minerals ................................................................................. 38
Classification of Minerals ........................................................................... 38
Meaning of Apparent and Hidden Minerals ................................................ 44
Ownership of Minerals ................................................................................ 45
Preference of the Opinion ........................................................................... 52
Summary ..................................................................................................... 53
CHAPTER THREE: OWNERSHIP OF OIL AND ITS ZAKÓH IN THE LIGHT
OF MAQÓØID AL SHARÔÑAH ........................................................................... 54
Introduction ................................................................................................. 54
x
Ownership of Oil and MaqÉÎid al SharÊÑah ................................................. 54
Oil ownership in Four Jurisprudence Schools ............................................ 55
ZakÉh of Oil ................................................................................................ 60
Should ZakÉh be imposed on State Who Owns Oil Resources? .................. 61
Summary ..................................................................................................... 67
CHAPTER FOUR: MAQĀØID AL SHARĪÑAH, OIL WEALTH AND
ECONOMIC DEVELOPMENT ......................................................................... 69
Introduction ................................................................................................. 69
The literal and technical definitions of the term MaqāÎid al-SharīÑah ........ 69
The emergence and development of MaqāÎid al-SharīÑah .......................... 72
Types of MaqāÎid al-SharīÑah ..................................................................... 74
MaqāÎid al-SharīÑah and Oil Wealth ........................................................... 82
Impact of Oil and its MaqāÎid with Regard to the Worship ....................... 82
MaqāÎid al-SharīÑah with Regard to the Spending on Mosques ................. 83
MaqāÎid al-SharīÑah of Oil in Jihād ............................................................ 84
Oil and MaqāÎid al-SharīÑah in the establishment of good Muslim ............ 86
The Oil and MaqāÎid al-SharīÑah with Regard to the Protection of lineage and
building a the Good Family ......................................................................... 88
MaqÎad al-SharīÑah of public ownership of oil ........................................... 90
The MaqÎad of investment .......................................................................... 92
Economic Development and Its Definition ................................................. 93
Types of Development ................................................................................ 96
Goals of development in Islam ................................................................... 98
Islamic Economics ...................................................................................... 99
MaqāÎid al-SharīÑah in Islamic economics ................................................. 100
Oil and economic development ................................................................... 105
Impact of oil on economic development ..................................................... 109
Summary ..................................................................................................... 112
CHAPTER FIVE: THE ROLE OF PETRONAS IN ECONOMIC
DEVELOPMENT IN THE LIGHT OF MAQÓØID AL-ØHARÊÑAH .............. 114
Introduction ................................................................................................. 114
A Brief History of Petronas ......................................................................... 114
Petroleum Activities Prior to Petronas ........................................................ 115
Causes that lead to the formation of Petronas ............................................. 116
Petronas and the Ownership of Petroleum resources .................................. 118
Discretionary powers and duties of Petronas .............................................. 119
Philosophy of the Company ........................................................................ 119
Petronas as global player ............................................................................. 120
Political Linkage of Petronas ...................................................................... 122
Petronas and Economic Development ........................................................ 127
Petronas’ Contribution in Export Sector ..................................................... 127
Contributions of Revenue to Federal Government ..................................... 133
Payments to Malaysian exchequer .............................................................. 134
Petronas and Foreign Investment ................................................................ 136
Petronas Redistribution of Oil Wealth ........................................................ 136
Petronas and Employment ........................................................................... 139
The Role of Petronas in Education and Skills Development ...................... 148
xi
The Role of Petronas in Health Protection .................................................. 154
The Role of Petronas in the Light of MaqÉÎid al SharÊÑah ......................... 160
Evaluation of Petronas Performance ............................................................ 160
Summary ...................................................................................................... 163
CHAPTER SIX: CONCLUSION AND RECOMMENDATIONS ................... 165
Conclusion ................................................................................................... 165
Recommendation ......................................................................................... 167
BIBLIOGRAPHY ................................................................................................. 168
xii
LIST OF TABLES
Table No. Page No.
2.1 Natural Resource ownership under constitutions 51
5.1 Petronas International Operations 121
5.2 Malaysia: Diversification of Exports 129
5.3 Export and Import (Petroleum and Gas) 131
5.4 Malaysia’s Major Exports 2001-2003 131
5.5 The Export of LNG 132
5.6 Gross Exports. 1987, 1997 and 1998 (RM million and % share) 133
5.7 Contributions of Revenue to Federal Government 134
5.8 Gas subsidies 138
5.9 Malaysia: Employment by Sector and Ethnic Group,
1970 1998 (000) 141
5.10 The Largest Government owned firms Listed on Bursa Malaysia by
Market Capitalization and Per Cent Owned 144
xiii
LIST OF FIGURES
Figure No. Page No.
2.1 Classification of minerals by Economist 40
2.2 Classification of Minerals by Classical Jurists 43
4.1 MaqÉÎid al-SharÊÑah 81
4.2 MaqÉÎid al SharÊÑah of Oil Wealth 93
4.3 Interdependence of MaqÉÎid al-ØharÊÑah, Oil Wealth and Economic
Development 113
5.1 Relationship between NEP, Government and Petronas 126
5.2 Petronas’ Contributions to Malaysia’s Development 159
5.3 Comparison Between MaqÉÎid al-ØharÊÑah And Petronas’
Contribution 162
xiv
LIST OF ABBREVIATION
ALAM Akademi Laut Malaysia
BCIC Bumiputera Commercial and Industrial Community
BPD Barrels per day
FIMA Food Industries of Malaysia
CARIF Cancer Research Initiatives Foundation
CSR Corporate Social Responsibility
INSTEP Institut Teknologi Petroleum Petronas
IPPs Independent Power Producers
GLC Government Link Company
HICOM Heavy Industries Corporation of Malaysia
LNG Liquefied Natural Gas
LPG Liquid Petroleum Gas
MHE Ministry of Higher Education
MADA Muda Agricultural Development Authority
MARDEC Malaysia Rubber Development Corporation
MIDA Malaysian Industrial Development Authority
NEP National Economic Policy
NIE Newly Industrialised Economy
NOC National Operations Council
OPEC Organization of the Petroleum Exporting Countries
Petronas Petroliam Nasional Bhd
PERMATA Petronas Management Training Centre
PMTSB Petronas Management Training Sdn. Bhd.
PSC Production Sharing Contract
SEDCs State Economic Development Corporations (SEDCs)
TDC Tourist Development Corporation
UDA Urban Development Authority
UTP Universiti Teknologi Petronas
1
CHAPTER ONE
COUNTORS OF THE SUBJECT
1.1 INTRODUCTION
AllÉh S.W.T has created human beings for His worship, as He states in the Holy
Qur‘Én “And [tell them that] I have not created Jinns and men to any end other than
that they may [know and] worship me” (al-dhÉriyÉt: 56).1 This world was created for
the use of human beings and its resources would enable the human race to sustain
itself, so that it can achieve the purpose of its creation. AllÉh (SWT) says in the
Quran, “Allah is the One who created the heavens and the earth and sent down water
from the sky, then brought forth with it sustenance for you from the produce, and
subjugated for you the ships, so that they may sail in the sea with His command, and
subjugated for you the rivers;). And He subjugated for you the sun and the moon,
moving constantly, and subjugated for you the day and the night”. [IbrÉhÊm: 32-36].2
Natural resources are one of the most fundamentally blessed sources that
provide human beings with the means to live. They are the basic building blocks of a
society or a country, and play a significant role in economic development. They come
in many forms. Crops grown through farming are essential for human survival, as
without them, people will be malnourished and unable to work. Renewable resources
such as wind, solar power, and water are able to provide us with limitless energy, not
forgetting the most basic means of survival and civilization. Minerals such as iron,
نس إلا ليـعبدون 1 .وما خلقت الجن والإ
لك لتجري في البحر بأمره م وسخر لكم الف الله الذي خلق السماوات والأرض وأنزل من السماء ماء فأخرج به من الثمرات رزقا لك 2.والنـهار الليل لكم وسخر دائبـين والقمر الشمس لكم وسخر. وسخر لكم الأنـهار
2
coal, fossil fuels, etc., are used to generate power and for export to other parts of the
world. The advent of industrial revolution energy, especially oil, has become an
indispensable part of the economy, and has great impact on the economic
development of a country.
Since the whole universe is created for human beings, they have to utilize the
resources in a way that their needs are met and they live a life of peace and happiness,
prosperity and security. Man is God’s vicegerent on the earth, he has been given the
guidance and teachings to live accordingly. The basic universal purpose of divine
guidance is to secure benefit for and repel harm to humanity. This theme is
indisputably established through the inductive reading of the QurÉn and Sunnah and
also known as MaqÉÎid al-SharÊÑah3 (objectives of SharÊÑah). According to ImÉm Al-
GhazÉlÊ, “The objectives of SharÊÑah is to promote the well-being of all mankind,
which lies in safeguarding their faith (dÊn), their human self (nafs), their intellect
(‘aql), their posterity (nasl) and their wealth (mÉl). Whatever ensures safeguard of
these five serves public interest (al-maÎlaÍah al-ÑÉmmah) and is desirable”.4
The uppermost SharÊÑah objectives regarding wealth and property consist of
wide circulation of wealth in society, transparency (rawÉj) in economic policy to
eliminate discriminations (wuÌËh), protection (Íifz), certainty (thabÉt) and justice
(Ñadl),5 and the purpose of acquisition and investment (takassub and istithmÉr).6
3 Ibn ÑÓshËr defines MaqÉÎid SharÊÑah as “the deeper meanings (maÑÉnÊ) and inner aspects of wisdom(Íikam) considered by the Lawgiver (ShÉriÑ) in all or most areas and circumstances of legislation(aÍwÉl al-tashrÊ’); Ibn ’ÓshËr M., Treatise on MaqÉÎid SharÊÑah, trans. M. T. El-Mesawi,(London-Kuala Lumpur: The International Institute of Islamic Thought- Al- MaqÉÎid Research Centreand Islamic Book Trust, 2006), 5-9.4 Chapra M. Umar, “The Islamic Vision of Development in The Light of MaqÉÎid al-SharÊÑah”,Occasional Paper Series: 15, (London: The International Institute of Islamic Thought, 2008), 118).5 Ibid., 279-293.6 Akhtarzaite binti Abdulaziz, “Al-DharÉ’i’ and MaqÉÎid al-SharÊÑah: A case study of Islamicinsurance”, Intellectual Discourse, Vol.18, no. 2, (2010): 269.
3
Since natural resources are essential for human survival and growth of human
civilization, this study attempts to discuss the role of oil wealth in economic
development in the light of MaqÉÎid al-SharÊÑah, and takes Petronas7, a wholly state-
owned oil company by the Malaysian government as a case study. The purpose of this
research is to examine the role of oil in Malaysia’s economic development in the light
of MaqÉÎid al-SharÊÑah.
1.2 PROBLEM STATEMENT
This study attempts to develop a theoretical model of oil wealth within MaqÉÎid
al-SharÊÑah framework through discussion of various issues pertaining to oil wealth in
the light of MaqÉÎid al-SharÊÑah discipline, based on Prophet MuÍammad’s (SAW)
saying “Muslims are partners in three things; water, pasture and fire”.8 The study
discusses whether oil falls under fire or not. If the oil is discovered in the property of
a person [whether in land or in water], the question is, should he be given the right to
own it, as allowed by the French law,9 or should it be taken from him and controlled
by the state, considering it a public property for the welfare of the whole community.10
Moreover, zakÉh of oil wealth should be imposed on the state-owned oil companies,
private firms and corporations? In addition to the aforesaid issues, points like oil and
economic development, identification of income distribution areas according to
MaqÉÎid al-SharÊÑah for the betterment of society and country, for example;
7 Petronas, the acronym for Petroliam Nasional Berhad, was incorporated on 17 August 1974 under theCompanies Act, 1965. It is wholly-owned by the Malaysian government and is vested with the entireownership and control of the petroleum resources in Malaysia through the Petroleum Development Act,1974. Over the years, Petronas has grown to become a fully integrated oil and gas corporation and isranked among the Fortune Global 500 largest corporations in the world. See: Petronas Annual Report2010, 6.8 AbË DÉud, Sunan AbÊ DaËd, Edited by AlbÉnÊ, MuÍammad NaÎir al-DÊn, Chapter: Book of ijÉrah,Section: fÊ man’i al-mÉÑ, 625.9 See: MaÍmËd al-Muzaffar, “Al-tharwah al-ma’daniyyah wa ÍuqËq al-daulah wa al-fard fÊhÉ”, (theRight of the State and Individuals in the Mineral Wealth), (Beirut: DÉr al-Haq, 2nd edn., 1998).10 As Prophet MuÍammad (SAW) said; “people are partners in three things; water, pasture and fire”.
4
infrastructure, education, health care centers, orphanages, and so on will also be
stressed upon as well as determine prohibited areas for investment of oil income.
These are a few examples of debatable issues that the present study attempts to discuss
in the light of MaqÉÎid al-SharÊÑah. The study chooses Petronas, a wholly state-owned
petroleum company as a case study to examine its efforts and role towards Malaysia’s
economic development within the framework of MaqÉÎid al-SharÊÑah.
1.3 JUSTIFICATION OF THE STUDY
The objectives of SharÊÑah are universal, and any organization can be studied in light
of that, whether it operates in a Muslim country or a non-Muslim country. What we
will see is, how it serves its stockholders in the light of MaqÉÎid al-SharÊÑah. In this
particular case, we are focusing on Petronas. In addition, Petronas happens to be
located in Malaysia where there is a vibrant Muslim society, the government is run by
majority Muslims and the constitution has given an especial status to Islam as the
state’s religion.11 Furthermore, many Islamic laws have been implemented in various
areas12. For example, in education we have an International Islamic university, in
pilgrimage operations there is Tabung Haji, Islamic banking in investment and
management of funds, Islamic insurance, Islamic finance, and now we are going to
examine how Petronas has been pursued, and to what extent the policies of Petronas
have fulfilled the objectives of SharÊÑah.
11 See: Article 3 (1), Laws of Malaysia, (2006), Published by The Commissioner of Law Revision,Malaysia Under the Authority of the Revisoin of Laws Act 1968 in Collaboration with PercetakanNasional Malaysia BHD, 18.12 Norhashiman Mohd YasÊn, “Islamization/Malaynization: A Study on the Role of Islamic Law in theEconomic Development of Malaysia: 1969-1993”, 7.
5
1.4 RESEARCH QUESTIONS
1- Does oil fall under the concept of fire as stated in the hadith, “Muslims are
partners in three things: water, pasture and fire”?
2- Determination of ownership of oil. Is oil public property, governments’ or
individuals’? Is it permissible for the state alone to own and benefit from
it? Is zakÉh of oil the responsibility on state-owned company? What if the
state-owned company pays tax instead of zakÉh?
3- What role does oil wealth play in economic development? What are the
most important practical implications in contemporary time?
4- What are the most important economic development goals that seek to be
achieved in the light of MaqÉÎid al-SharÊÑah?
5- To what extent is Petronas able to participate in Malaysia’s economic
development in the light of MaqÉÎid al-SharÊÑah?
1.5 OBJECTIVES OF THE RESEARCH
1- To examine the position of oil in the QurÉn and ×adith and the classical
and modern fiqh.
2- To determine the ownership of oil, whether state, individual or foreign
companies have the right to own it, focusing on the matter of zakÉh and
tax.
3- To highlight the relationship between oil wealth and economic
development, indicating how to take the advantage of this resource to
achieve the economic development in the light of MaqÉÎid al-SharÊÑah.
4- To identify the goals of economic development to be achieved in the light
of MaqÉÎid al-SharÊÑah.
6
5- To analyze the experience of Petronas in the income generation of oil
wealth investment, its role in Malaysia’s development and its benefits to
society in the light of MaqÉÎid al-SharÊÑah.
1.6 SIGNIFICANCE OF THE STUDY
This research attempts to draw a preliminary methodological framework for
diagnosing real-world situations and then prescribing and implementing Islamic
solutions for the problems of society. The importance of the study can be determined
in the following main points:
- The lack of significant academic study on the role of oil wealth in the
economic development in the light of MaqÉÎid SharÊÑah; besides, the
researcher has not found any study that examines the role and contribution
of Petronas in the development of Malaysian society, according to the
MaqÉÎid SharÊÑah.
- The search for a new concept, far from the prevailing ideas of
development, aiming to achieve economic development, consistent with
the values of Islamic law.
- The present researcher is of opinion that the need for such a study in this
subject is significant, particularly in English because the language is
increasingly becoming the most common medium of communication
among Muslim scholars. In this study, the researcher intends to provide a
comprehensive study of the classical and modern views regarding oil
wealth, which perhaps will be a valuable resource for scholars as well as
researchers.
7
1.7 RESEARCH METHODOLOGY
The research will employ inductive, hermeneutic and analytical methods;
1- The inductive method is to collect data to compare the views of the
various schools of fiqh.
2- The hermeneutic13 method is intended to interpret the texts of the QurÉn,
Sunnah, and the views of jurists and contemporary scholars, to gain access
to the rules of the Islamic approach, which can be followed in economic
development.
3- The analytical and care study method is used to examine Petronas’
contribution to Malaysian society in the light of the MaqÉÎid SharÊÑah
model, by studying its annual reports, policies and in-depth discussion.
1.8 LITERATURE REVIEW
There are many articles and scholarly works produced by scholars that focus on the
role of economic development and MaqÉÎid SharÊÑah. However, there is no
comprehensive literature yet that has given full attention to and has critically analyzed
Petronas and its participation in economic development in the light of MaqÉÎid
al-SharÊÑah.
However, having said the above, there are some great work, which are relevant
to this thesis, and from which it hopes to benefit and could help this study. The
following paragraphs discuss some books and works which are relevant to this
research.
13 Hermeneutics is an art of interpretation, in other words the theory that refers to the study of theinterpretation of written texts, especially texts in the areas of literature, religion and law. Contemporary,or modern, hermeneutics encompasses not only issues involving the written text, but everything in theinterpretative process. This includes verbal and nonverbal forms of communication as well as prioraspects that affect communication, such as presuppositions, pre-understandings, the meaningand philosophy of language. <http://en.wikipedia.org/wiki/Hermeneutics>, accessed 4 August 2011).
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In the further review, we shall not deal with all the accumulated literature on
the subjects of MaqÉÎid, economic development and oil. Rather, we shall confine
ourselves to three categories of works as follows:14
1- The first category consists of two theses that address the subject of mineral
wealth from the Islamic perspective.
2- The second Category deals with MaqÉÎid al-SharÊÑah, through abundant in
literature; its application in today’s economic sector is limited.
3- The Third category discusses the works related to the economic
development, specifically to the care of Malaysia’s economic development
with regard to Islamic values.
The first category consists of two theses that address the subject of mineral
wealth from the Islamic perspective.
Firstly: Al-tharwah al-ma’daniyyah wa ÍuqËq al-daulah wa al-fard fÊhÉ (the
Right of the State and Individuals in the Mineral Wealth) by MaÍmËd al-MuÐaffar15
was submitted as a doctoral thesis at the Institute of Islamic Studies in Bagdad
University. A revised and expanded version of this work bearing the title “Al-tharwah
al-ma’daniyyah wa ÍuqËq al-daulah wa al-fard fÊhÉ” was published by DÉr Al-Haq in
1998. The purpose of this thesis is to provide all details and Islamic rulings related to
minerals; it is a comparative study between Islamic jurisprudence and te contemporary
institutions and laws.
14 It should be noted that the present researcher did not find any work pertaining to Petronas that dealswith Islamic or MaqÉÎid SharÊÒah perspectives, except, (1) Information technology outsourcing issues:A case study of Petronas Bhd Malaysia, by Abduljaleel Kehinde Shittu. (2) Knowledge managementimplementation in Petronas: A case study by Naguib Chowdhury. Both theses have been submitted toKulliyyah of Information and Communication Technology at International Islamic University ofMalaysia.15 MaÍmËd al-Muzaffar, “Al-tharwah al-ma’daniyyah wa ÍuqËq al-daulah wa al-fard fÊhÉ”, (the Rightof the State and Individuals in the Mineral Wealth), (Beirut: DÉr al-Haq, 2nd edn., 1998).
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MaÍmËd divides the study into an introduction and three chapters and
supplements. In the introductory chapter he focuses on the nature of the minerals and
explains them from the linguistic and idiomatic perspectives, the kinds of minerals
and their impact on the development of human civilization and establishment of the
rules for modern scientific and technological renaissance. Then MaÍmËd talked about
the ownership of minerals, comparing between Islamic and contemporary
international laws regarding the method of acquiring the right to cultivate barren land.
Furthermore, he sheds the light on taxation of minerals, the meaning of rikÉz (ore), the
characters of its tax, and the kinds of minerals upon which the tax is imposed, and the
doctrines of different schools of fiqh in this regard, and the necessary conditions to
pay the tax on minerals. However, MaÍmËd just focuses on the rules of mineral
wealth in determining the right of individuals and state according to the jurisprudence,
comparing them with the international law, during the discussion of minerals he shed
the light briefly on oil wealth as well, which is the main theme of the present research.
In addition, MaÍmËd in his study does not talk about the economic development and
MaqÉÎid SharÊÑah that the present research aims to deal with.
Secondly: ÑAÍkÉm al-tharwah al-ma’daniyyah wa ÑatharuhÉ fi al-tanmiyah
al-iqtiÎÉdiyyah,16 (Rules of the Mineral Wealth and their Impact on Economic
Development) by MuÍammad ‘Ayman Al-KhatÊb.
This is a doctoral thesis, which was submitted to the Faculty of Islamic Studies
at Damascus University. The aim of the thesis is to demonstrate the importance of the
cultivation of barren land, giving it to the one who works at and extracts its resources,
and its impact on economic and social developments. Furthermore, it explains the
16 Al-KhatÊb, MuÍammad ÑAyman, “ÑAÍkÉm al-tharwah al-ma’daniyyah wa ÑatharuhÉ fi al-tanmiyahal-iqtiÎÉdiyyah, (Rules of the Mineral Wealth and their Impact on the Economic Development), (PhD,thesis, Damascus University, 2009).
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functions of the state and its role in the process of economic development through
intervention, planning and social justice in the society. It determines a compulsory
share for individuals according to SharÊÑah. The main contribution of this thesis is that
it discusses the resources and minerals al-maÑdan according to Islamic jurists’ and
geologists’ point of view.
Al-KhaÏÊb focuses on several issues; the legitimacy of cultivation of barren
land and its impact on economic development, the conditions of barren land and what
it carries of the minerals, the concept of development in modern economic and Islamic
thought and the role of the state in achieving economic development through the
mineral resources. In addition, he examines the tax on extracted minerals from the
earth and the sea, and the conditions of this tax.
In his thesis, al-KhatÊb more deals with the rules of mineral wealth as MaÍmËd
did, but besides focusing on the jurisprudence wealth, al-KhaÏÊb examines the role of
mineral wealth in economic development. However, the present research attempts to
examine the role of petrol explicitly in economic development in the light of MaqÉÎid
al-SharÊÑah, that makes the present research more specific and hence different from
al-KhaÏÊb’s thesis.
Second Category: In this category, we shall review the works which deal with
MaqÉÎid al-SharÊÑah. This category consists of three works.
Firstly: The work of M. Umar Chapra entitled “The Islamic Vision of
Development in the Light of Al-MaqÉÎid SharÊÑah”,17 was published by the
International Institute of Islamic Thought London, 1429/2008. The author argues that
the aim of this book is to explain what MaqÉÎid al-SharÊÑah or goals are, how they are
all mutually interrelated, and in what way they can together help to promote real
17 Chapra M. Umar, “The Islamic Vision of Development in The Light of MaqÉÎid al-SharÊÑah”,Occasional Paper Series: 15, (London: The International Institute of Islamic Thought, 2008), 118.
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