Early Islam

Trade and Commerce During the Islamic Golden Age

Ahmed Danyal Arif, London, UK

From the 8th to the 11th centuries, the Muslim world exerted, on the East as on the West, an undisputed economic supremacy. Take the example of Iraq, the first centre of the Abbasid dynasty (750 AD-1258 AD), where  commercial exchange had existed throughout the Late Antiquity period (284 AD-700 AD). But there is a contrast between the agrarian-based economy of that earlier period and the more urban and commercialized orientation during the Islamic golden age.

The ‘Islamic market’, a large and unified economic bloc stretching from the Atlantic Ocean to Central Asia, is assumed to have been created by Muslim conquests and  political as well as social conditions favourable for economic growth in general and for commerce in particular.[1] Commerce was seen as  positive and encouraged by the elimination of previous political boundaries, especially between the Byzantine Empire and Sassanian Iran, through the abolition of transit tolls and through greater security. Along with the emergence of a single monetary system based on both gold (dinar) and silver (dirham) and the use of Arabic as a single commercial language, these factors contributed to greater regional exchange and interdependence, regional agricultural and industrial specialisation, and the export of raw material, agricultural products and textiles for mass consumption. [2]

However, it would be unjust if we focused on the achievements of the Islamic world without considering the context in which they arose. Before recounting the specifics, we must not forget that it was not only its power which helped the Abbasids to achieve such great economic growth. The foundation for this growth was the teaching of the Holy Prophet (sa), who set forth  a magnificent example of honesty and integrity, and stressed his believers to emulate these qualities as well. For example, the Holy Prophet (sa) once came upon a merchant who was selling some grain or rice. He put his hand deeper into the hand of rice and found that the grain inside was wet. He admonished the seller, explaining that he should represent his goods honestly so that the buyer could make an informed decision as to the quality of the product. This emphasis on honesty and integrity in buying and selling led to strong mutual trust – trust that is essential to the development and growth of trade, and thereby triggering an economic revolution.

Islam, Trade and Commerce

Since ancient times at the very least, the Arabian peninsula’s inhabitants were professional and experienced merchants. Arab tribes settled mostly near the coast (more specifically the southwestern corner, called ‘Arabia Felix’, which enjoyed more productive fields and fertile soil), with their mercantile caravans travelling regularly, serving as a commercial link between Syria and Egypt on one side and the coasts of the Indian Sea on the other.[3] There was also a custom of arranging commercial fairs at various locations during different times of the year, wherein merchants coming from distant places would engage in trade. Regions such as Dumat al-Jandal, Mushaqqar, San’a and Ukaz, among others, were quite noteworthy in the observance of these fairs. Before the advent of Islam and during the time of the Holy Prophet (sa), the mercantile caravans of the Quraish regularly travelled to Syria, Yemen and other regions as well. Exports consisted mainly of valuable minerals, pearls, spices and fragrant materials, while imports were generally comprised of grain, clothing, weaponry, liquor and dry foods.[4]

When the Holy Prophet Muhammad (sa) reached the age of adulthood, he was also involved in commerce upon the desire and encouragement of his uncle Abu Talib. He (sa) travelled to many places, including Yemen, Syria and Bahrain. Every time, the Holy Prophet Muhammad (sa) fulfilled his commercial engagements with remarkable honesty, trust and skill. Because of this, he received the title of Amin (honest) among the Makkans. As a result of this honesty, the Holy Prophet (sa) was also greatly revered in Makkah and was known as an exceptionally righteous individual who always spoke the truth.

The Holy Prophet Muhammad (sa), before his claim to prophethood, also acted as agent in a partnership in which the investment was provided by the illustrious and noble Hazrat Khadijah (ra). Once, she sent Muhammad (sa) to Syria with her commercial goods and because of his exceptional honesty and truthfulness, this trade venture was successful and much profit was generated. Witnessing his great moral qualities and capabilities, she herself proposed marriage to him and thus became Muhammad’s (sa) first wife.

Since the earliest converts to Islam had included members of the Quraish, the tribe of the Holy Prophet (sa) himself, , the region’s lengthy legacy of experience in mercantile endeavours and trade was perpetuated in the formative years of the Islam. Many of the followers and eminent companions of the Prophet Muhammad (sa) were traders. They increased their wealth through trade and the Holy Prophet (sa) did not stop them from doing so. On the contrary, the Holy Qur’an encouraged it in the following words:

‘O ye who believe! Devour not your property among yourselves by unlawful means, except that you earn by trade and mutual consent.’[5]

‘Allah has made trade lawful and made interest unlawful.’[6]

After the demise of Holy Prophet (sa), enthusiasm for trade only expanded along with the first conquests and increasing acceptance of Islam’s message. Despite Islam’s meteoric rise, it did not disturb either the surrounding regions’ underlying operating parameters or their economic motivations – as trade continued unabated. The mass of Arab immigrants did not impede normal economic activity, and the healthy transitional integration was accomplished because of the introduction of an ingenious system of stipends under the Caliphate of Hazrat Umar (ra). With the regular financial assistance provided under the Caliphate of Umar (ra), the immigrants, far from becoming an economic liability, reactivated cash mobility in new territories, since they reinvigorated the economy by spending those stipends.[7] Muslim rulers maintained political and administrative cohesiveness and did not levy any taxes that the population of the Near East had not already been paying for the benefit of the earlier political regimes.

It is obvious that the rise of a political and administrative structure in the central regions of Near East, in Syria under the Umayyads (661 AD-750 AD), and in Mesopotamia under the Abbasids (750 AD-1258 AD), was accompanied by a powerful injection of ready cash into the economy. People who received that cash were then able to spread that wealth to the wider community by spending it on goods. As a consequence, new urban settlements created new consumer centres and this contributed to a substantial increase in economic productivity. Later, with the transfer of the Islamic caliphate from the Umayyads to the Abbasids dynasty in 750, the Dar al-Islam found itself even more directly situated at the concourse of trans-continental commerce.

Economic Geography and the Commercial Network

In 750, the first dynasty ruling the Islamic world, the Umayyads of Damascus (661-750), collapsed following a revolution in the Khurasan region (in modern-day Iran). However, it would take another ten years or so for the next dynasty, the Abbasids, to truly establish itself. After consolidating his political leadership, Caliph Ja’far al-Mansur quickly laid the foundations for the new Abbasid state by shifting the centre of the Islamic Empire towards the East, in the heart of Mesopotamia (present-day Iraq).

More broadly, the geographical location of Iraq made it a land bridge between Iran, India, Central Asia and China on one side; and the Arabian Peninsula, Syria, Egypt and the West on the other. Thus, under suitable conditions, the inhabitants of Iraq were able to become the effective intermediaries of world commerce, being at the intersection of multiple land and sea trade routes and that made it a centre of transit trade for surrounding regions.[8] According to the economic historian Michael G. Morony, ‘the major overland routes intersecting in central Iraq in the late Sasanian period radiated north-eastwards through Hamadan and Ray to Khurasan and the Silk Road to China, eastwards along the lower Tigris to Khuzestan, Fars and Sistan, southwards through Bahrain and the Yamamah to Sasanian Yemen, westwards from al-Hira across the Syrian desert to Gerasa and Egypt, and to the northwest along the Royal Road east of the Tigris from Daskara to Kirkuk, Altun Kupri and Irbil, then west across the Khazir River and the Tigris at Gomel to Nusaybin and Byzantine Mesopotamia. A transit route went through Iraq from the Gulf to Byzantine Mesopotamia.’[9]

Major new port facilities were constructed at Basra and served as arteries for commercial transport, and neighbouring Ubulla on the Arabian Gulf was the terminus of seaborne trade to India and China. From these seaports, merchants could proceed to Oman and Yemen, from whence they could embark on one of two major trade routes — westward to East Africa, Zanzibar, and the Comoros Islands; or eastward to India, Malaysia and China. These overland routes continued to be used in early Islamic times, with the most important being the Khurasan road to north-eastern Iran. The Khuzistan road from Basra to Kirman was used in the ninth century by Jewish merchants who went as far as India. Also, new trade routes connected Basra and Kufa with the Hijaz, went up the Euphrates River to Raqqa with overland connections to Syria, went up the Tigris River to Mosul displacing the old Royal Road and then overland to Nasibin, brought Russian merchants via the Volga and Caspian overland from the south shore of the Caspian to Baghdad, and connected al-Basra by sea with East Africa and the Red Sea.

The Central Position of Baghdad

From the late eighth century, Baghdad (Madinat al-Salam), the new capital of the Abbasids, developed as the economic nexus of the network just described. But the image of trade converging on and radiating out from this great metropolis should be qualified by noting the existence of multidirectional exchange between all of Iraq’s urban commercial centres along  with transit trade through Iraq.

Regarding the capital, the Caliph al-Mansur himself laid the first brick on the west bank of the Tigris, and to build it, he employed 100,000 architects, artisans, smiths, carpenters and other laborers. They worked for four years (762-766), and its total cost amounted to 4,883,000 dirhams. Destined to be a major urban centre, by the 9th century, Baghdad covered over 25 square miles and boasted a population approaching a half million people.[10]

When Ja’far al-Mansur founded this ‘Round City’ to become his capital (which until then had been located in Damascus) he was fully aware that he had made the centre of the Islamic world (the caliphate) coincide with the centre of the world. Indeed, sources clearly show that the location of the site was chosen, not just for its defensive advantages, but also for its economic potential. Tabari attributes to its founder the following words: “This is a good place for an army camp. Here’s the Tigris, with nothing between us and China, and on it arrives all that the sea can bring, as well as provisions from the Jazirah, Armenia and surrounding areas. Further, there is the Euphrates on which can arrive everything from Syria, al-Raqqah, and surrounding areas.”[11]

In another passage, as he was looking for a suitable site for his new capital, he was advised to go to a place called Barimma, which was known for its convenience and healthiness. After spending the night there, he rejected the site and said: ‘It could not support the army, the people, and the various groups. What I want is a place that is comfortable for the people and congenial for them as well as for me, a place where the prices will not become too high for them and the food supplies will not prove too hard to obtain. If I live in a place where it is impossible to import anything by land or sea, the prices will be high, goods will be scarce, and shortages in the food supply will cause hardship for the people.’[12]

It is hard to be certain that such words were actually spoken, but they reflect the thinking of the Caliph and his advisers when they see the advantages of the site in Baghdad. And as indicated by medieval Arab sources, the direction and dispersion of Abbasid trade clearly made the Dar al-Islam a veritable emporium of merchandise – a vast trade mart produced by the Islamic administration’s intense commitment to promoting mercantile activities.

A Variety of Goods Exchanged

The essential goods for Iraq’s urban centres were foodstuffs and edible agricultural products.[13] Many grains (wheat, barley, rice) were grown in Iraq but were also imported from Egypt, Mosul and India. Dates were grown around Basra and Kufa and exported to Sri Lanka, apples came from Isfahan and Syria and peaches from Iran. Quinces, pears, prunes, citrons, jujubes, olives and figs respectively came from Syria, Iran, Isfahan, Rayy, Susa, Jurjan and Raqqa. Fruit syrup, dried fruit and various kinds of nuts came from the Jazira or India. Cheese and honey came from Mosul and the Volga region, mushrooms from Balkh and dried fish from Iran. Sugar and vegetable oil for cooking came from Syria, Yemen and Iran. Mosul and Isfahan were also sources of salt, spices came from Iran and India, while cinnamon and ginger came from China.[14]

Among important objects of exchange, there were also raw materials, manufactured cloth, articles of clothing and carpets. Although produced and exported from Iraq, cotton cloth and silk textiles also came from Syria, Central Asia or Andalus, wool and felts from Armenia or North Africa, and silk from Iran, Samarqand, India and China. Specific articles of clothing included undergarments, scarves, turbans, veils, hats, waistbands, belts, cushions, mattresses, bedspreads, and prayer mats. Although the best textile dyes are said to have been prepared at Wasit, most dyes for textile production seem to have been imported to Iraq. Saffron, indigo, curcuma, sumac for tanning and dying and acacia leaves for tanning came from Yemen, Iran, India, Egypt but also North Africa. Leather, tiger skins, shoes or fennec arrived from Yemen, northern Arabia, Central Asia, India, and the Volga region.[15]

Already used by early Islamic times, aromatic substances and the use of perfumes appears to have increased. Perfumes generally came from Azerbaijan, Tibet or India. Musk came from Tibet and China, camphor from India, frankincense and myrrh from Yemen, and oils of jasmine from Fars. Various drugs came from India and China and medicinal preparations were also traded.

Precious stones were also articles of commerce. Rubies and diamonds came from India and Sri Lanka, emeralds from Iran, the best pearls came from Oman and ivory reached Baghdad from East Africa. Metals and wood had to be imported into Iraq. Silver came from Yemen, gold from East Africa and China, and the best kinds of copper from Andalus. Wood, especially teak for houses and ships as well as white sandalwood came from India.[16]

Finally, a variety of other manufactured articles was traded. Soap came from various places like Raqqa and fish glue from the Volga region. Paper came from Egypt, Samarqand and China, ink from China, and reed pens from Raqqa. Glass utensils came from Baghdad and  Syria. Pottery goods were likewise produced in the capital and jars for filtering water came from Maysan, while porcelain was imported from China.[17]


As described, a massive international trading network rapidly spread out under the early Abbasids. Actively promoted by the caliphate’s government itself, the resulting commercial achievements thereby became the capstone of longstanding productive early Arab trade. Considerable quantities of articles destined for mass consumption, textiles and victuals were exchanged between distant provinces of the vast empire. There can be no doubt that this increase in the volume of trade ushered in a flourishing period for many. Industrial production was growing steadily, prices and salaries were rising, the demand for skilled labour was considerable and the population of the urban areas increased more and more. In other words, the major trends of social and economic development in the Islamic world were exactly contrary to those characteristics of the history of Europe during the same period, which, at the time, was going  through a  period of population decline along with a decline in trade

Founded upon a powerful legacy of mercantile tradition and lent structure by the economic tenets of Islam – an intricate trading network that had begun in pre-Islamic Arabia, was impelled by the early Muslims, and culminated, in its full fruition, under the early Abbasid dynasts. The result was a vibrant economic outcome that would ultimately empower the Dar al-Islam to forge the most far-reaching and dynamic commercial empire that the world to date had known.

About the Author: Ahmed Danyal Arif is a French economist by education and currently working in London. He has a Master’s degree in Economics and Politics. After working for the French tax administration system, he published two books in French: Islam & Capitalism: For an Economic Justice (2016), and Economic History of the Islamic World: From Pre-Islamic Arabia to the Umayyad Dynasty (2019). He currently serves as the Editor for the Economics Section in The Review of Religions.


[1] M Shatzmiller, “Economic Performance and Economic Growth in the Early Islamic World,” Journal of the Economic and Social History of the Orient, vol. 54, (2011) pp. 132-184; F Bessard, Caliphs and Merchants: Cities and Economies of Power in the Near East (700-950), (Oxford University Press, Oxford: 2020).

[2] M Lombard, The Golden Age of Islam, (Princeton: Markus Wiener Publishers, 2009), translated by Joan Spencer; M. Rodinson, Islam and Capitalism (New York: Penguin Books Ltd., 1973), 56, translated by Brian Pearce.

[3] A D Arif, “Meccan Capitalism & the Economic Revolution of Islam”, Rational Religion, 2018, Accessed September, 2022.

[4] Hazrat Mirza Bashir Ahmad (ra), The Life & Character of the Seal of Prophets (sa) (Sirat Khatamun-Nabiyyin), volume 1, (Tilford: Islam International Publications: 2011), 69.

[5] The Holy Quran, 4:30.

[6] The Holy Quran, 2:276.

[7] A. D. Arif, “The Forgotten Economic Genius of Hazrat Umar ibn Al-Khattab”, Rational Religion. March, 2020. Accessed September, 2022.

[8] A. A. al-Duri, Ta’rikh al-‘Iraq al-Iqtisadi fi’l-Qarn ar-Rabi al-Hijri, (Economic History of Iraq at the 4th Century A.H.) (Beirut: 1974), 119.

[9] M Morony, “Commerce in Early Islamic Iraq”, Asien Afrika Lateinamerika, vol. 20, (1993): p. 701; Al-Duri, pp. 141-151.

[10] P. K. Hitti, Capital Cities of Arab Islam, (Minneapolis: University of Minnesota Press: 1973), 88.; G W Heck, Charlemagne, Muhammad and the Arab Roots of Capitalism (Berlin & New York: De Gruyter, 2006), 67.

[11] A. Y. Al-Tabari, The History of al-Tabari (Ta‘rikh al-rusul wa‘l muluk), Volume XXVIII: ‘Abbasid Authority Affirmed, Bibliotheca Persica, State University of New York Press, edited by E. Yar-Shater, (2001): p. 238.

[12] Al-Tabari, p. 240.

[13] H. N. Kennedy, “The Feeding of the Five Hundred Thousand: Cities and Agriculture in Early Islamic Mesopotamia”, Iraq. vol. 73, (2011): pp. 177-199.; A. M. Watson, Agricultural Innovation in the Early Islamic World: The Diffusion of Crops and Farming Techniques, 700-1100 (Cambridge: Cambridge University Press,1983).

[14] E. Ashtor, A Social and Economic History of the Near East in the Middle Ages (London: William Collins Sons & Co Ltd: 1976), 78.; Al-Duri, pp. 138-140; Morony, p. 702.

[15] Al-Duri, pp. 138-141; Morony, p. 703.

[16] Al-Duri, pp. 138-141; Morony, p. 704; A. J. Naji, Y. N. Ali, “ The Suqs of Basrah: Commercial Organization and Activity in a Medieval Islamic City”, Journal of the Economic and Social History of the Orient, vol.24. no.3 (1981), pp. 298-309.

Add Comment

Click here to post a comment