By Ade Mulyo
Ending poverty and inequality are some of the greatest challenges that the Sustainable Development Goals (SDGs) aim to overcome. As Islamic principles support socially inclusive development, funding from Islamic giving - termed ‘Zakat’ - has the potential to play a crucial role in bridging funding gaps to achieve the SDGs.
The ‘Zakat’ Islamic wealth tax, is obligatory for all who can do so, and is an essential Islamic financial redistribution mechanism considered to be a personal responsibility for all Muslims, to ease economic hardship of the poor. Zakat has great potential to mobilize additional untapped resources for poverty alleviation, however, its impact on reducing the vulnerability of the poor depends on the amount of Zakat collected.
In Indonesia, Islamic philanthropy is growing rapidly. Based on the BAZNAS (The National Zakat Board) outlook report, the amount of national Zakat funds in the period from 2010 to 2015 consistently increased, reaching a total of about USD 269 Million in 2015. According to BAZNAS, Zakat has the potential to provide billions more, thus there is a huge potential to harness these financial resources and direct them towards achieving SDG’s in the country.
BAZNAS plans to develop a more effective collection management and impactful implementation system, to unleash the power of Zakat to achieve the SDGs in Indonesia, accelerating poverty alleviation and reducing inequality for millions.
The first initiative on the theme of Zakat was facilitated by SDG Philanthropy Platform Indonesia (UNDP Indonesia) together with Platform partner Filantropi Indonesia, with a dynamic seminar held in late January 2017. This was followed by a series of intensive meetings between BAZNAS and SDGPP Indonesia to pursue collaboration on Zakat for the SDGs.
From these fruitful discussions, a formal collaboration was signed on the 14th of March 2017, at the opening of the high-level World Zakat Forum, where United Nations Development Programme (UNDP) and the National Board of Zakat (BAZNAS) signed a letter of intent to collaborate in capturing and enhancing Zakat’s high potential impact on Indonesia’s national development.
“We welcome BAZNAS’ commitment to support the Sustainable Development Goals, in particular on eliminating poverty and inequalities, and providing quality healthcare, education, and clean water and sanitation. With its long experience in development, UNDP will work with BAZNAS to harness the full potential of zakat to improve the life of the people and achieve the Sustainable Development Goals in Indonesia,” - said UNDP Indonesia’s Country Director Christophe Bahuet, who signed the letter of intent with BAZNAS Chairman Bambang Sudibyo during the opening of the World Zakat Forum.
Ade Mulyo is Head of Partnership Development at the SDG Philanthropy Platform Indonesia, at UNDP Indonesia