The role of interest-free financing tools for ensuring sustainable export

Nowadays, no country can survive without involving into (international) trade activities. Exports and imports are two elements of the foreign trade. The major source of foreign reserve, GDP and other advancements for almost all developing states is exports. The main purpose of this thesis is to identify export related tools under Islamic finance, track recent improvements and highlight the best Islamic export financing practices in the world. The methodology used in this study is descriptive approach followed by some foreign trade financing experiments. The study also utilized the methodology of induction to clarify how Islamic finance can increase and improve export performance of the states. Due to the lack of interest free-financing data under export related statistics, an empirical or analytical approach seemed impossible for now. In this study, prominent interest free financial methods for exporting companies that do not wish to operate with interest and/or do not have necessary capital are investigated and policy recommendations are brought forward. In this regard, first; literature review, the importance of exports and financing status are discussed; then, the necessity of interest free finance is explained. Lastly, interest-free financing methods and examples at the export stage are debated. The study concluded that Islamic finance is far away from its potential to be used in the export finance. While we underline the overall situation in terms of interest free financing at the export stage, we realize in the literature review that there is almost no study focusing on the Islamic financing of export. Most of them are concerned with domestic trade or Islamic banks, rather than the export financing. This reveals that there is a need for further research on this topic. When we look at the interest-free export finance examples, we also realized that the international organizations have a crucial role. Essentially, interest-free financial activities are carried out with the help of international organizations.