Malaysia accelerating halal industry’s growth

It is currently in talks with several countries to bring the local halal agenda forward, backed by strong requests of the local halal products

by SHAHEERA AZNAM SHAH / Pic by AFIF ABD HALIM

The introduction of halal certificates since 1974 has earmarked Malaysia’s role in spearheading the global halal industry, being the first country to set a standard regulation for halal products.

The pioneer status continued when in 2000, Malaysia also became the first to have a documented and systematic halal assurance standard that revolutionised the industry into a new source of economic growth.

The government outlined blueprints and action plans with aims to intensify the development of halal industry and positioned Malaysia to take the lead.

Realising the economic potential of the industry, a development agency was established under the International Trade and Industry Ministry in 2006.

Set up to develop the country’s industrial capacity, Halal Industry Development Corp (HDC) was poised to drive the local halal scene forward into a global direction.

Two years later, the Halal Industry Master Plan 2008-2020 was launched by the government to facilitate in achieving the country’s economic goal of becoming the global leader in innovation and production in the halal sector.

Now, more than 40 years since the first step, Malaysia has emerged as the new growth leader in the global scene with an increasing consumer base and market potential.

HDC CEO Datuk Seri Jamil Bidin (picture) attributed the continuous government involvement in positioning Malaysia as the global leader for the halal industry.

“We have to recognise the government’s involvement in building a comprehensive ecosystem for our halal industry, and (which) has been one of our advantages at present.

“To my knowledge, some countries are only focusing on the production and not on building the infrastructure around them. Some are only focusing on the halal certificate. In Malaysia, we have an ecosystem that is thorough, backed by the government’s incentives and the public-private partnerships.

“All of these encouragements have led Malaysia to be the global reference centre for halal industry and we are being recognised by the Organisation of Islamic Cooperation countries,” he told The Malaysian Reserve recently.

Malaysia is currently in talks with several countries to bring the local halal agenda forward, backed by strong requests of the local halal products.

“We have received requests to bring halal products as far as Latin America and this is coherent with our internationalisation agenda to create more market space in the global region,” he said.

Realising the potential of rising demand for local halal products, Jamil added that Malaysia is fully aware of the significance of raising the stakes of the country’s industry players.

“We have seen results in the halal exports from year to year as the trade is steadily increasing. And we are continuously levelling our standards and production by hosting trade shows and conferences to accommodate the increasing requests for our products,” he said.

The halal sector is considered one of the most critical industries as it serves the Muslim population’s religious needs and is simultaneously capable of reaching to the rest of the global population.

With growing competition from foreign players, HDC is working hard to ensure Malaysia’s leading position.

“We want more of our local halal industry players to go abroad and succeed at an international level.

“If we look at the industry as a whole, it is safe to say that we have grown exponentially within a short span of time and our development is far ahead in terms of overall environment,” he said.

Jamil said it is difficult to measure the degree of success between countries in the industry, as each country is performing at a different pace.

“It is tough to compare whether we have a better trade export or other countries like Thailand has, as each halal producing country is varied in terms of ecosystem.

“For example, some countries do not have an official statistics data from the government to show what they have made and what they are projected to make. Thus, it is tough to compare when there is no data to begin with.

“We should have a little faith in our halal industry, as it is comprehensive among other halal producing countries. We are very clear of our target and what we want to further develop,” he added.

“We are in the third phase of our national halal master plan, which started in 2015. The third phase will see the country broaden its geographical reach for its homegrown companies.”

Earlier this year, the government announced that the country’s halal industry is projected to reach RM50 billion in trade exports by 2020 with a growth rate of 5% to 6% by the end of 2017.

While the halal food and beverages (F&B) expenditure is expected to grow to US$1.9 trillion (RM8.09 trillion) by 2021, more market-moving decisions were made in Malaysia to realise the economic targets.

For the past year, the government has — through the halal industry — entered into several international partnerships to forge closer ties in various fields including the trade, tourism and halal sector.

“We are confident that by the year 2020, we are able to achieve those targets. One of the reasons being that we have identified new market places that are coming up, especially in the Middle Eastern countries.

“For example, now we are in talks with the Saudi Arabian government for a partnership in exporting our F&B, as well as our expertise there. We hope to finalise the deal before the end of the year.

“This partnership will also stand in as our gateway to enter the African market that we are planning to tap into due to the high market potential,” he said.

Jamil added that the African continent has a population of 1.22 billion, of which 200 million are Muslims. However, due to logistics and other reasons, the market is still untapped by industry players from Malaysia.

Based on HDC data, Malaysia had only exported RM3.3 billion worth of halal products to Middle Eastern countries in 2015, almost double that of Gulf Cooperation Council countries.

During the same period, the Asia-Pacific Economic Cooperation’s country members received the most export value by Malaysia — recorded at RM27 billion — surpassing the export trade to Asean countries, which was recorded at RM11.7 billion.

Malaysia has been known to host significant international halal events as well as for the local halal scene, namely the annual Malaysia International Halal Showcase, Halal Fiesta Asean and the World Halal Conference to further promote and solidify Malaysia’s halal agenda.