What Is Islam’s Stance on Free Markets, Import Bans, and Minimum Wage?

Answered by Mawlana Ilyas Patel

Question

What is Islam’s view on free markets, import restrictions, and minimum wage? Are import bans and trade with non-Muslim countries permissible?

Answer

In the Name of Allah, the Most Merciful and Compassionate.

I pray you are in good faith and health. Thank you for your question.

The Islamic Economic System

Business in Islam goes beyond personal enrichment; it aims to benefit and develop society as a whole. Consequently, a framework of ethical rules and morals has been established to consider the well-being of others. As a result, any transaction that causes harm to an individual or society is condemned in Shariah. This is why practices such as price fixing are explicitly prohibited.

Shari‘a encourages free trade and a competitive market. Individuals are free to sell commodities at any price they choose. However, a free market must be free from monopoly, deception, risk, ignorance, fraud, underpricing, gambling, usury, and all forms of unlawful consumption of others’ property. It also emphasizes the importance of promoting a work-based economy that focuses on actual production.

Minimum Wage

It would be good if governments employed a minimum wage structure so people would not be underpaid. However, the overall well-being of their employees is a moral issue rather than a legal issue with all of its consequences. Salary payment is also subject to many factors, including the law of supply and demand. As there is a fairness aspect relating to the employee, there is also a fairness aspect about the employer.

That is why Islamic law focuses more on enforcing contracts to protect workers’ rights, and the hadiths are more consistent with this approach.

I would like you to go through the valuable answers and links below. In sha’ Allah, you will receive guidance and direction.

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I pray this helps with your question.
Wassalam,
[Mawlana] Ilyas Patel
Checked and Approved by Shaykh Abdul-Rahim Reasat

Mawlana Ilyas Patel has received traditional education in various countries. He started his schooling in the UK and completed his hifz of the Quran in India. After that, he joined an Islamic seminary in the UK, where he studied secular and Aalimiyya sciences. Later, he traveled to Karachi, Pakistan, and other Middle Eastern countries to further his education. Mawlana has served as an Imam in the Republic of Ireland for several years and taught the Quran and other Islamic sciences to both children and adults. He also worked as a teacher and librarian at a local Islamic seminary in the UK for 12 years. Presently, he lives in the UK with his wife and is interested in books and gardening.