Waqf is an important institution in the Islamic socio-economic system. It has played a key role throughout Islamic history. According to Cizakca (2002: 264), history has shown that waqf institutions have managed to provide social welfare services that many current states struggle to offer.
The establishment of waqf institutions all over the Muslim world was indeed the result of benevolence an act of devotion towards God. Baskan (2002: 18) reports that during the Ottoman period the financing of health, education and welfare services was entirely entrusted to the waqf system.
Currently, the potential of waqf organizations is substantially unrealized. It is the conventional philanthropic institutions that are functioning more effectively. Therefore, there is a strong need to re-evaluate the current waqf institution and its needs. Efforts are also needed to develop a better approach for its financial management to increase its efficiency and performance (Boudjellal, 2008: 125).
This research aims at examining the role of waqf and its contribution towards socio-economic development, starting with the historical role of waqf in enhancing social welfare and moving on to discuss its important and unique potential role in the socio-economic development of present societies, particularly how it can be developed to be a principal provider of public goods. It proposes several strategies for reviving the waqf institution and highlights the importance of integrating modern approaches into the waqf system to produce an efficient welfare service for the community. This research hopes to increase public awareness on the unique role of waqf, which is deemed to be an investment in this world and the hereafter.
