Malaysia is a progressive Islamic country. It is business-friendly to Muslims and non-Muslims alike, making it a Halal industry advantage. As an economically thriving nation, the Malaysian economy registered a gross domestic product (GDP) growth rate of 7.5 per cent for 2017, fuelled by domestic demand and continued expansion in private and public consumption. The industry reported an annual export value of halal products worth RM43.4 billion in 2017 and had attracted RM13.3 billion worth of investments for its Halal Malaysia (Halmas) Halal Parks.
Today, the country has become an export-driven economy spurred on by high technology, knowledge-based and capital-intensive industries. It’s evident that there are bigger opportunities to tap into. The CEO of Halal Industry Development Corporation (HDC) Dato’ Seri Jamil Bidin has also expressed that the global Muslim market alone is expected to reach US$7.7 trillion in 2030.
And that’s only in Malaysia. Growing at an estimated annual rate of 20 per cent, the Halal industry is a booming business on a global scale. In fact, the Halal food market now makes up about 19 per cent of the global food market. From food to health care and everything in between, this up and coming lifestyle is not just limited to Muslims, the industry has experienced a growing market of non-Muslim consumers as well.
In this article, we explore the growth factors of today and tomorrow for the Halal market.
Definition of Halal
The word “Halal” means permissible in Arabic. In order for a food to be considered ‘Halal’ it must:
1. Does not contain any parts or products of animals that are non-halal to Muslims or products of animals which are not slaughtered according to Shari’ah law,
2. Does not contain any ingredients that are Najs according to Shari’ah law,
3. Is safe and not harmful
4. Is not prepared, processed or manufactured using equipment that is contaminated with things that are Najs (filth or unclean) according to Shari’ah law,
5. The food or its ingredients do not contain any human parts or its derivatives that are not permitted by Shari’ah law, and
6. And during its preparation, processing, packaging, storage or transportation, the food is physically separated from any other food that does not meet the requirements stated in items above. or any other things that have been decreed as Najs (filth or unclean) by Shari’ah law.
More than a Meal
The Halal market covers more than just food and beverages. The Halal industry has experienced a soaring demand for Halal products worldwide such as cosmetics, toiletries, pharmaceuticals and now even services including travel, banking, finance and logistics. Because of the increase in products many consumers are looking for Halal-certified food and many manufacturers are looking to get Halal-certified. Getting Halal certification is not an easy feat. Every country has their own Islamic council that is certified to give the official Halal seal of approval.
In Malaysia, it is the only country in the world whereby the government provides full support in promoting the Halal Certification process on products and services. Halal certification bodies in other countries are either developed by the individual provinces or states or backed by their non-governmental organizations (NGOs).
Halal Certification provides assurance to all Muslim consumers because it fulfils the Syariah law, which is a must for Muslims. To the non-Muslims, Halal products are quality products, simply due to the concept of halalan thoyyiban (Halal and wholesome) as HDC strongly advises all Halal certification applicants to comply with GMP and HACCP requirements. Thus, products certified Halal by JAKIM are Halal products which are safe to consume or use, nutritious and with quality.
Future of the Halal Industry
The industry has expanded across many other markets and regions outside of the Middle East this is reflected especially in Asia. For example, in an effort to expand their domestic Halal industry, China has moved to improve trade with the Organisation of Islamic Cooperation countries through its “One Belt One Road” initiative.
And due to the increase of affluent Muslims, the Halal industry has expanded further into lifestyle offerings including Halal travel and hospitality services as well as fashion and cosmetics. There is also an increase in non-Muslim consumers, noting “health”, “food safety” and “great taste” as reasons to seek Halal food. This development has been triggered by the change in the mindset of healthy food, as well as the call for more ethical practices worldwide.
The international market also benefits from the Halal market as there is almost always a Muslim community that has a need for Halal products in a country. In many local communities, it is thought that not all Halal logos are legitimate, so having well-known and trusted Halal certifications can help in the long run for businesses. Even non-Muslim countries are focusing their efforts on Halal products. Japan airline, ANA has recently asked Malaysia to help with their selection of Halal food for their in-flight food and beverage services.
The global Halal market has emerged as a progressive component in the global economy. With a Muslim and non-Muslim consumer base increasing every year, the Halal industry is set to become a competitive force in the international business world.