The Chair of the Expert Council of the Indonesian Association of Islamic Economists (IAEI), Dr. Mustafa Edwin Nasution, believes that waqf has great potential to become an instrument of national economic resilience. Based on calculations, the potential economic returns from waqf assets could reach Rp109 trillion per year. This was conveyed during the IAEI Expert Council’s National Symposium and Discussion Forum held in the VVIP Hall of the Istiqlal Mosque in Jakarta on Tuesday (September 29).
Mustafa said that waqf has a long history as an instrument of development and community empowerment. Indonesia once hosted the Sixth Congress of Ministers of Waqf and Islamic Affairs of the Organization of Islamic Cooperation (OIC) in Jakarta in 1997, which produced the Jakarta Declaration, which, among other things, called for the revitalization of waqf activities in OIC member countries.
According to Mustafa, the evolution of thinking regarding waqf has since broadened with the emergence of the concept of cash waqf, opening up opportunities for more flexible waqf contributions while also allowing for productive management. “Cash waqf offers an important lesson: waqf does not always have to be understood as an immovable asset. Waqf funds can be raised, managed productively, and the proceeds returned for the public good,” said Mustafa.
In his view, strengthening waqf as an economic instrument requires stronger institutional capacity to drive productivity and asset empowerment, while maintaining proper governance and accountability.
This potential, Mustafa noted, can be seen from the estimated value of waqf land assets in Indonesia, which he stated amounts to approximately Rp2,000 trillion. Assuming these assets generate a net return of 5 percent, the potential economic return is around Rp100 trillion per year. Meanwhile, cash waqf is estimated to generate an additional return of approximately Rp9 trillion per year, assuming the same rate of return. Thus, based on the calculations presented at the forum, the potential economic returns from these two sources amount to approximately Rp109 trillion per year.
To drive the realization of this potential, Mustafa proposed strengthening the legal framework for waqf, including through amendments to Law No. 41 of 2004. In his view, regulations need to provide greater scope for the productive development of waqf assets, while simultaneously strengthening governance and ensuring that the benefits are felt by the community.
According to Mustafa, the development of waqf also needs to shift from a fundraising orientation toward empowerment. Asset productivity, the professionalism of waqf administrators, governance, financing, regulatory certainty, and connectivity with the real sector are key factors for waqf to develop as a sustainable economic instrument.
