Saudi Arabia eager to tap into $2.1trn global market for halal products

By Rashad Hassan and Nor Arlene Tan – Arab News

World halal industry chiefs served up their ambitious plans for a global expansion of the $2.1 trillion food market

Saudi Arabia is aiming to tap into a multi-trillion-dollar global market for halal food and related products.

The Kingdom, along with other Middle Eastern countries, is looking to develop business links with Malaysia which has become one of the world leaders in the halal industry.

A top-level Saudi ministerial trade mission to the Southeast Asian country this week explored further economic cooperation between the two nations.

The three-day visit by Saudi Economy and Planning Minister Mohammed Al-Tuwaijri coincided with the opening of the Global Halal Summit 2019 (GHaS) in Kuala Lumpur.

World halal industry chiefs attending the start of the conference on Wednesday served up their ambitious plans for a global expansion of the $2.1 trillion food market.

Leading sector representatives set out proposals to take advantage of the latest technologies such as mobile apps, artificial intelligence, and robotics to boost international trade. And as well as promoting halal food globally, the sector also hopes to further tap into supply chains for halal-related products such as cosmetics, consumer goods, and pharmaceuticals.

Khalid Halawani, commercial adviser to Saudi Arabia, told Arab News that through the initiatives of the Vision 2030 reform plan the opportunities for Malaysian companies in the Kingdom were “huge” not only in the halal sector but also manufacturing.

“At the same time, it (Vision 2030) is also encouraging Saudi companies to go abroad to produce products that are needed in Saudi Arabia, and to transfer
the know-how from Malaysia or any countries to Saudi Arabia,” Halawani said.

“The market in Malaysia is different from that of Gulf countries but both have the same needs and investments. My job is to connect those needs.”

The rise of the halal industry globally has seen Malaysia build a strong and inter-connected halal ecosystem, with government agencies handling certification, and the country hosting major halal businesses and international exhibitions.

Malaysia’s government religious body (JAKIM) is working closely with Saudi Arabia to streamline the halal certification process.

“Trade relations between Saudi Arabia and Malaysia are good and growing. There are a lot of business and investment opportunities in both countries, in fact there are now 90 Malaysian companies that are investing in Saudi Arabia,” Halawani added.

Economic cooperation between countries in the Middle East and Malaysia is strengthening, reflected in Saudi minister Al-Tuwaijri’s visit. He arrived on Monday for a three-day trip during which he held talks with Mohamed Azmin Ali, Malaysia’s economic affairs minister, on forging new trade links.

One of the key discussions centered on reviving the Malaysia–Saudi Arabia Joint Commission Meeting (JCM) last held more than 15 years ago. “The JCM will also explore how best to enhance other cooperation programs that will add value to our respective economies,” said Ali.

“We have identified the tourism, healthcare and energy sectors, including new energy sources such as solar, among our primary focus,” he added. The next meeting will take place in Saudi Arabia next year.

Meanwhile, addressing delegates at the GHaS opening ceremony, Malaysian MP Dr. Mujahid Yusof said that Islam was a systematic way of life, and its religious teachings came with comprehensive standards and guidelines to be adhered to by Muslims. One of these, he said, was the concept of halal (permissible), which came together with haram (prohibited).

Yusof explained that the growth of the industry was primarily driven by the demand for halal food globally. Quoting figures from the State of the Global Islamic Economy Report 2018/2019, he said 1.8 billion Muslims spent an estimated $2.1 trillion in 2017 across a range of halal lifestyle sectors.

The conference gathering in the Malaysian capital provided a “great platform” from which to promote the development of a single unified global halal standard and help strengthen the global halal economy, Yusof added.

This year’s GHaS meeting is a re-brand of the World Halal Week, an annual gathering of the industry’s brightest minds and passionate halal professionals, which started in 2004 with the world’s first halal-only international trade show – the Malaysian International Halal Showcase (MIHAS).

On the back of the conference theme, “halal connecting the world,” Malaysia is aiming to become a global halal hub, the minister said.

Delegates were told that the market had expanded beyond the food sector to include pharmaceuticals, cosmetics, health products, toiletries and medical items, travel and tourism, fashion, as well as service-sector components such as logistics, marketing, print and electronic media, packaging, branding, and financing.

Furthermore, the concept of tayyib (wholesome) blended with the other growing trends such as organic food, non-cruelty to animals and sustainable development in line with UN goals.

Yusof said there was now growing interest from non-Muslim countries in halal products and services.

Malaysia is seen as the pioneer of the halal certification system, with the JAKIM halal logo becoming a familiar trademark throughout the world.

There are currently 7,263 companies approved with the halal certificate of Malaysia.

The recent development of JAKIM includes opening up international certification opportunities for contract manufacturing and overseas food manufacturing plants.

Malaysia has also set up a coalition to establish and oversee the process of halal certification across the globe. The country recognizes 78 foreign certification bodies from 45 countries.

The Malaysia External Trade Development Corporation (MATRADE) aims to provide an avenue for businesses to develop and expand exports of halal products overseas, organizing trade events such as GHaS.

Yusof said the Halal Industry Development Corporation (HDC) was set up to position Malaysia as a global halal hub as the world was on the cusp of entering the Fourth Industrial Revolution.

“I believe that the halal industry should explore and take advantage of this revolution in the sub-sectors of Internet of Things (IoT), blockchain, nanotechnology, industrial big data analytic and mobile technology,” said the minister.

Mobile phone apps already help travelers find halal eateries and mosques.

Yusof added that more than 40 countries were taking part in this year’s conference.

Speaking at a GHaS dinner, Malaysian Deputy Prime Minister Dr. Wan Azizah Wan Ismail said the government would continue to promote the Malaysian Halal Center of Excellence globally, with the first center outside of the country set to open in Bosnia at the end of this month. This center would be expanded to other parts of the world soon, she added.

Ismail said that she would like to see more Muslim entrepreneurs, especially young people, use digital platforms to promote halal products and practices.