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@Halal | november-december. 2019
Highlight
I
n the ‘State of the Global Islamic Economy
Report 2018/19’ by Thomson Reuters, it was
found that the global Islamic economy
in 2017 was worth USD 4.5 trillion, and
this number is expected to grow to a
staggering USD 6.8 trillion by 2023.
This might in part be attributed to the grow-
ing global Muslim population. Based on the
Global Islamic Economy Indicator (GIE), the
number of Muslim people in the world stood
at 1.8 billion in 2017.
This number is projected to double to 3
billion by 2060, presenting a massive opportu-
nity for more world economies to get involved
in the Halal industry.
Strengths of
the Malaysian Halal industry
Malaysia possesses many unique advantages
in developing and promoting Halal products
and services, such as its recognition as
a moderate and progressive Islamic and
business-friendly country by both Muslim
and non-Muslim global communities.
Malaysia is well-known globally as a
leader in the Halal ecosystem, driven by
comprehensive Halal standards, and a strong,
well-structured ecosystem.
Decades of experience have shaped
the ecosystem and industry to bring out
standards par excellence, including legisla-
tive guidelines, regulatory controls and
enforcement, as well as a comprehensive
manufacturing, supply chain and customer
marketing infrastructure servicing both the
domestic and export markets.
Poised to remain at the top, Malaysia has
achieved strong export revenues through
the Halal industry, where it hit export sales
of over RM 40 billion in 2018. This number
is expected to rise by RM 2 billion (USD 500
million) over the next three years.
The Malaysian Halal industry contributes
approximately 7.5 per cent to the country’s
GDP. Over 7,400 companies are Halal-regis-
tered, generating 249,000 jobs. Over 1,700 of
these companies actively export to regional
and overseas markets.
The expertise Malaysia has also allowed
it to play an important role in establishing
‘Halal Guidelines’ regionally and internation-
ally. This global recognition not only feeds
back locally, intensifying local acceptance,
but also influences global, well-known
hypermarkets such as Tesco and Aeon to look
towards Malaysia for Halal products for their
stores.
Contributors to the success of the local
Halal industry include the concerted efforts
of multiple stakeholders such as Government
agencies, commercial players, the banking
industry, as well as academic and research
institutions in the country.
The Malaysian Halal Ecosystem
Most people would immediately think of
the F&B industry when it comes to Halal
products. However, the industry is far bigger
than that.
Whilst it is true that F&B products and
services garner the highest visibility in
markets, other sectors contribute too, such
as pharmaceuticals, modest fashion, cosmet-
ics, financial services, hospitality, Islamic
tourism, R&D, education, logistics and
e-commerce.
The Malaysian Halal industry has seen
positive year-on-year growth averaging 10%
since 2012. In 2018, Halal exports contributed
4 per cent to the country’s total exports at RM
40 billion, and by 2020, it is estimated to grow
to RM 50 billion.
According to the HDC, key export sectors,
out of total exports, include Food & Beverage
(RM 19.98 billion, 49.9 per cent); Halal ingre-
dients (RM 14.53 billion, 36.3 per cent); Palm
Oil derivatives (RM 1.79 billion, 4.5 per cent);
Cosmetics and Personal Care (RM 2.99 billion,
7.5 per cent); Chemicals (RM 0.36 billion, 0.9
champion
Malaysia, the
of world’s halal growth
The global demand for
halal products as well as
services paved the way
for Malaysia to set its
feet into the market and
becomes a benchmark
country for various halal
standards.
per cent), and Pharmaceuticals (RM 0.4 bil-
lion, 1 per cent).
Innovation is at the heart of the develop-
ment of the Malaysian Halal industry, and
is found in all aspects of the supply chain,
including R&D, product design, formulations,
sourcing, inventory management, manufac-
turing and distribution logistics.
Players in the ecosystem have refined
necessary processes, done the groundwork
and devised quality frameworks that serve
as the foundation of Malaysia’s positioning