The impact of the financial crisis on the global economy: can the Islamic financial system help?

Abstract Purpose – The aim of this paper is to analyse the different measures taken by the G7 and G20 leaders to face the current global financial crisis and to show whether such decisions represent a return to protectionism. Design/methodology/approach – The paper proposes the introduction of a new economic system based on Islamic banks' principle which calls for cancelling interests. This line of thinking might solve speculation problems and put this type of crisis to an end. Findings – This financial crisis pushed most developed countries to lower their banking rates and to implement null‐approximating interest rates, a move which replicates the principle adopted by Islamic banks. Originality/value – The paper represents a point of view on the financial crisis, the return to protectionism and the role of Islamic banking.