Three complications arise in assessing trade by Islamic countries in the modern period. First, the identification of countries as Islamic is a recent development, dating back to 1969 and the establishment of the Organization of the Islamic Conference (OIC). Second, there is a dearth of data on Islamic countries for most of the modern period. Third, until the mid-twentieth century most of the Islamic countries were under the direct or indirect influence of non-Islamic foreign powers. The Arab countries were parts of the Ottoman Empire before they came under Western, non-Islamic influence in the early nineteenth century. Pakistan was a part of the Indian subcontinent ruled by Britain until after World War II. Indonesia was under Dutch influence, and Algeria was ruled by France from 1832 to 1962. A similar fate characterized the histories of most of the other OIC members.
In addition to having a lasting impact on the economic and trade policies of Islamic countries, Western influence has had two important results. First, data relating to the present national boundaries of OIC members are recent in origin. Second, the trade policy of these countries was rarely influenced by Islamic thought or principles. Trade policy in the Ottoman period, for example, was influenced by capitulation agreements and colonial interests, which tended to undermine Ottoman authority and Islamic rules.
The capitulations were agreements that awarded concessions to citizens of Western, non-Islamic countries trading or residing within the Ottoman Empire. These concessions protected foreigners against discrimination or restrictions emanating from the Islamic civil laws of the empire. The agreements also gave Westerners more freedom of trade and travel and better terms of trade than enjoyed by natives of the empire. For example, export duties paid by natives were higher than import duties, which proved advantageous for foreigners. These benefits were sometimes extended to native residents who were non-Muslim and had a religious affinity with a particular foreign power. Thus, Catholics enjoyed the protection of France and the Vatican; Protestants, Britain; and Orthodox Christians, Russia. As a result, Greeks, Armenians, Lebanese and Syrian Christians, Egyptian Copts, and similar minorities, such as British, French, and Italian residents, were predominant in both foreign trade and the commerce of the Islamic countries in which they resided. [See Capitulations. ]
The direction and composition of trade were little effected by Islam and were evidently determined by economic complementarity rather than by the religious identity or doctrine of the trading parties. The impact of colonialism on trade was best demonstrated by the high percentage of trade with non-Islamic foreign countries. Islamic countries traded mostly with the colonial powers to which they were subjected in compliance with the interests of the dominant countries. This situation continues in the 1990s.
This pattern of trade was reinforced by the economic underdevelopment and poverty of the Islamic countries and by the relatively low complementarity between Islamic economies. Trade with non-Islamic Western countries was based on exchanging primary and natural products for manufactured goods that Islamic countries did not produce. Ottoman trade with Europe and the United States constituted 93 percent of all exports and imports in the late nineteenth century. Exports from Islamic countries included wheat, barley, fruits, hides, silks, and other raw material. Imports centered on processed and manufactured goods and machinery.
A number of modifications in trade policy have been enacted since the end of World War II. After the war national interests and increasing the relative share of intra-Islamic trade were emphasized. However, little change has been effectedin trade composition or direction or the relation of trade to Islamic principles or doctrines. The OIC charter specifies areas of economic cooperation among the members, including expanded trade and the eventual creation of an Islamic common market. To facilitate trade, Islamic financial institutions have been established, promotional and administrative committees have been formed, and much political rhetoric has been broadcasted. Nevertheless, the direction, volume, and composition of trade among members of the OIC have only slightly been effected. Exports of primary goods, mainly to other Islamic and Third World countries, have continued to dominate, while imports have been dominated mainly by manufactured goods from developed non-Islamic countries. Oil as a major raw-material trade item has reinforced the traditional colonial pattern. The traditional pattern and direction of trade have been reinforced also by the relative poverty and economic and technological underdevelopment of the OIC members. Economic complementarily among OIC members has tended to be lower than it is among the developed non-Islamic countries and OIC members. The OIC members have also tended to be more concerned with political unity than with economic cooperation, and therefore they have been rather slow in creating the conditions for expanded trade among themselves. Furthermore, the pattern of trade has been sustained by tradition and relatively strong ties with former colonial powers, which would be too costly to break. Finally, that pattern of trade is not in contradiction with Islamic principles and doctrines, and therefore the OIC members can hardly argue for its change on religious grounds. It is notable that commercial laws of the Islamic countries of the Middle East reflect no influence of Islamic thought or doctrine. To avoid any potential conflict with nationalistic or religious principles, some Islamic countries, such as Bahrain, Egypt, and Turkey, resort to such neutralizing measures as offshore banking units and free trade zones.
Major task forces have been created and many recommendations have been made to promote economic cooperation and trade among Islamic countries. However, intra-Islamic trade has remained relatively small and the pattern established in preindependence and pre-OIC times has continued because it has a rationality of its own. It is neither contradictory with Islam nor has it been politically feasible to alter. Its rationality is augmented further by the economic conditions within the OIC economies, which include relative poverty, relative underdevelopment, and traditional dependence on the highly developed non-Islamic countries of the West with which they share a high degree of complementarity. The OIC has tried to promote complementarity and trade by establishing the Islamic Chamber of Commerce; the fruits are yet to come.
[See also Economics, article on Economic Institutions; Islamic Chamber of Commerce; Organization of the Islamic Conference.]
BIBLIOGRAPHY
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ELIAS H. TUMA
TRADITIONS. See Had-ith.
