First, a startling fact: Though the United States is not an "Islamic" country by conventional definition, in spirit and in real terms, its financing institutions offer more Shariah compliant financing and investment than that provided by all the Islamic banks combined.

American venture capital firms provide in excess of $25 billion per year in equity financing to help finance the development and growth of thousands of new startups in health care, information technology, and other promising industries. By contrast, Islamic banking institutions invest less than $1 billion a year on a "Musharaka" basis (Musharaka - partnership or joint venture - is similar to venture capital).

Indeed, there is no better example of Shariah-compliant financing than venture capital finance. Venture capital allows entrepreneurs to build a firm without having to borrow and pay high interest charges before they generate revenues. It is a process of cooperation between entrepreneurs and venture capitalists, with risk sharing an essential element. Entrepreneurs provide the bright ideas, and hard work, while venture capitalists furnish the money - either their own or that of their clients - as partners, not lenders. Simply put, if the business succeeds both benefit and in case it fails the entrepreneur is not obligated to repay the investment. This is the essence and spirit of Islamic finance.

Venture capital system has played a leading role in the industrial development of the United States. The financial cycle begins when a smart engineer or a scientist undertakes ground breaking research - occasionally financed by the federal government - at a major university and then starts a company with the expert assistance and financing provided by a venture capital firm. Later, they jointly take the company public at a huge share price, benefiting both parties.

Scores of Silicon Valley companies including modern day giants such as HP, Intel, Sun Micro Systems, Apple Computer, Netscape, Intuit, Compaq Computer and Cisco Systems were financed by the venture capital industry in the form of equity capital. All were created in the last 25 years from ideas grounded in science and technology. Scientists, engineers and entrepreneurs came up with the ideas, research and inventions, while the venture capital industry provided the funds on a partnership basis.

Significantly as a result of this cooperation millions of new jobs - 20 million during Clinton's eight year presidency alone - have been created in the United States.

Venture capital gives the US a creative and forward looking dynamism that few nations can match because it is rooted in the very foundation of the country. In this regard America's most important advantage is a willingness to take risks. By contrast, if a scientist or an engineer with a new idea or invention wanted to raise financing to develop his idea or invention into a business in the Islamic world it would be virtually impossible for him to find funds. He or she would be told by a conventional bank or an Islamic bank to first produce some collateral.

It was not always so. The Europeans learned from Muslims. Muslims made original inventions. This was made possible by a culture and environment that encouraged learning, research and invention. Today most technology used in the Muslim world comes from outside the region. It seems that native springs of invention have dried up and nothing of mention has been invented in any of the Islamic countries in the last two hundred years! Muslims that once led the world in science, are dropping behind at a rapid rate in scientific research and information technology.

The venture capital industry largely financed those who decided to go into business, in developing and bringing their products to the market. This then is the crucial difference between America and Muslim countries. If an American team of engineers or scientists has an idea about a new product or application, they can easily get venture capital investment. In Muslim countries very little, if any, risk capital is available.

A major factor in the Islamic world's underdevelopment is the non-availability of suitable financing for entrepreneurs. If the leaders in the Islamic world are truly interested in improving the living standards of their people, gaining economic independence, regaining their pride and days of glory, they must encourage original discovery, research and invention.

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