Launch of the State of the Global Islamic Economy Report and Indicator 2014/2015 Findings
For the second consecutive year, Thomson Reuters, the world’s leading provider of intelligent information for businesses and professionals, in partnership with the Dubai Islamic Economy Development Centre (DIEDC) present findings from the State of Islamic Economy Report 2014/2015 and launches the Global Islamic Economy Indicator (GIEI2014).
The GIEI indicator is exclusively hosted on Thomson Reuters Zawya, which includes features allowing visual data alongside figures signifying the Global Islamic Economy overview.
To download the SGIE 2014/2015 report, click here
To view the online model of GIEI Indicator, click here
To get the latest updates #GIEI2014
The Islamic Economy covers 7 main sectors: Islamic Finance, Halal food, Halal travel, Modest Fashion, Halal Media & recreation, and Halal pharmaceutical & cosmetics. While there is a growing trend of unique products and services catering to the large 1.6 billion Muslim population, there is a distinct lack of a comprehensive overview and assessment around the Islamic Economy sectors. Asset size, growth rates and profitability are important, but quantitative measures cannot be the only markers of the success of the Islamic Economy. The appropriate assessment of Islamic Economy development should address how well the overall ecosystem is growing; this includes the regulatory system and governance, market awareness and perceptions, and social impact of the Islamic Economy.
Key Report Findings:
- Global expenditure of Muslim consumers on food and lifestyle sectors grew 9.5% from previous years’ estimates to $2 trillion at the end of 2013
- Islamic finance assets estimates at $1.66 trillion at the end of 2013
- Global Muslim spending on food and beverages (F&B) has increased 10.8% to reach $1,292 billion in 2013. This takes the potential core Halal Food market to be 17.7% of global expenditure in 2013 from 16.6% the year before.
- UAE, China and Italy lead the Modest Fashion Indicator that focuses on the health of the modest fashion ecosystem a country has relative to its size.
About Global Islamic Economy Indicator (GIEI)
The Global Islamic Economy Indicator is a true barometer of the state of the Islamic Economy sectors based on a number of fundamental indicators across a variety of dimensions. The Indicator introduces a new way of measuring development by combining data of the different elements of each sector into a singular composite Indicator. This quantified information will help facilitate further comprehension, visualisation and assessment of how the different parts of the market are developing over time
Economy Development Centre (DIEDC), in partnership with Thomson Reuters , the world’s leading provider of intelligent information for businesses and professionals, and in collaboration with the Dinar Standard has launched the ‘State of the Global Islamic Economy Report (SGIE)’ for the second consecutive year, and introduced the ‘Global Islamic Economy Indicator (GIEI) .
The launch event was held at the DIFC Conference Centre in Dubai, in the presence of key stakeholders from the Islamic economy domain and industry professionals.
With an unprecedented number of case studies and factual data, the 2014-15 State of the Global Islamic Economy Report indicates the continuing build-up of the Islamic economy momentum. The report also highlights key local and global findings within Islamic economy as highlighted by the Global Islamic Economy Indicator (GIEI), a numeric measure representing the overall health and growth of the Islamic economy across 70 countries.
His Highness Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum, Crown Prince of Dubai said:
“Dubai has achieved great milestones in key sectors of the Islamic economy with the support of DIEDC and other major players in the field. The growth is testimony to the wisdom and vision of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, who has provided Dubai’s economy with a roadmap for a sustainable development, in line with the UAE Government’s strategy to become one of the leading countries in the world by 2021.”
“The launch of the State of the Global Islamic Economy Report reiterates Dubai’s leading role as an incubator of knowledge for the Islamic economy industry. The report leverages the emirate’s ongoing endeavours to become the capital of Islamic economy. We are delighted to learn from the key findings of the report that the pace for a full-fledged Islamic economy launched in 2013 is on the right track to achieve its objectives.”
His Excellency Mohammed Abdullah Al Gergawi, Chairman of the DIEDC Board, said:
“The launch of the State of the Global Islamic Economy Report reiterates our commitment to nurture a knowledge-based Islamic economy in line with the vision of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, and the guidance of His Highness Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum, Crown Prince of Dubai to position Dubai as the Capital of Islamic Economy. We in the UAE are proud of the leading role played by our institutions in supporting the development of the Islamic economy locally and globally.
His Excellency Essa Kazim, Secretary General of DIEDC, added:
“The purpose of the State of the Global Islamic Economy Report 2014 is to inspire and empower entrepreneurs, industry leaders, and investors to evaluate and develop an actionable, practical, and high impact market strategy focused on growing the opportunities for Islamic economy in their markets.””
Abdulla Mohammed Al Awar, CEO of DIEDC, said:
“The key findings of the report and the 2014 index are an important value addition to our ongoing efforts in developing the Islamic economy across strategic sectors. The findings will go a long way in helping experts and stakeholders draw up future plans and develop innovative initiatives to articulate Dubai’s vision to become the Capital of Islamic Economy.””
Nadim Najjar, Managing Director, Middle East and North Africa, Thomson Reuters , said:
“As the world’s leading information provider, Thomson Reuters has harnessed the power of its enterprise, in partnership with the DIEDC and Dinar Standard, to provide groundbreaking insights on the available opportunities in Islamic economy and the possibilities for advancement of this rapidly emerging market segment.”
Dr Sayd Farook, Global Head of Islamic Markets, Thomson Reuters , said:
“In 2014, the SGIE Report has introduced a groundbreaking quantifiable measure of the development of the global Islamic economy. An independent multi-dimensional barometer, the GIEI defines the development of the global Islamic economy beyond quantitative consumption measures, to assess the entire eco-system supporting the Islamic economy in any one country. The UAE, Malaysia and Bahrain lead this inaugural composite Index for 2014.”
Size & momentum:
Although still in its early days, the SGIE Report focuses on core sectors of the global Islamic economy and their ecosystem that have through Islamic values structurally impacted consumer lifestyles and business practices. Collectively these majors sectors are: Islamic finance, halal food and lifestyle sectors (fashion, travel, pharmaceutical & cosmetics, media & recreation).
The 2014-2015 report estimates that global expenditure of Muslim consumers on food and lifestyle sectors grew 9.5%[1] from previous years’ estimates to US$2 trillion in 2013 and is expected to reach US$3.7 trillion by 2019 at a compound annual growth rate of 10.8%. This forms the potential core market for halal food & lifestyle sectors.
In addition, this report estimates Islamic finance assets at US$1.66 trillion in 2013. Islamic funds and sukuks led growth with 14% and 11% growth year-on-year, whereas Islamic banking experienced a 5% drop in its assets. The report estimates the potential universe of Islamic finance assets in its core markets (assuming an optimal penetration scenario) to be US$4.2 trillion in 2014.
Value-drivers:
The customers of this Islamic economy are universal with shared values. At the highest level, value-based customer needs that are driving the Islamic economy sectors include Islamic/ethical financing, halal food, clothing and family-friendly travel. These needs also extend to business practices that seek Islamic business financing, investment and insurance services. It is, however, important to recognise the wide diversity in awareness and adoption of ‘halal’ among the core customer base of Muslims globally.
Introducing GIEI
This year the report introduces a formal Global Islamic Economy Indicator (GIEI), a composite index that presents the current development health of Islamic economy sectors across 70 core countries. The UAE, Malaysia and Bahrain lead this inaugural composite Index.
The Indicator is not a ranking of current size and growth of each market, but evaluates the quality of the overall Islamic economy ecosystem including social considerations that each has relative to their size. The ranking is weighted towards Islamic finance and halal food ecosystems given their relative sizes to other sectors. Top countries vary per sector reflecting relative strengths in each of the sectors covered in the report.
Halal food & lifestyle sector update:
The estimates of the global Muslim population’s expenditure on Islamic economy identified sectors (besides finance) are as follows:
· Food market: Global Muslim spending on food and beverages (F&B) has increased 10.8% to reach US$1,292 billion in 2013. The potential core halal food market registered 17.7% of global expenditure in 2013 compared to 16.6% the year before. Top countries with Muslim consumer food consumption are Indonesia (US$190 billion), Turkey (US$168 billion), Pakistan (US$108 billion) and Iran (US$97 billion), based on 2013 data.
Meanwhile, the UAE, Malaysia and Australia lead the Halal Food Indicator that focusses on the health of the halal food ecosystem a country has relative to its size. A special focus report on Halal Food logistics estimates logistical costs for the potential global halal food market to be US$151 billion in 2013.
· Clothing & fashion market: Global Muslim consumer spending on ‘clothing and footwear’ has increased 11.9% to reach US$266 billion in 2013. Top countries with Muslim consumers clothing consumption (based on 2013 data) are Turkey (US$39.3 billion), the United Arab Emirates (US$22.5 billion), Indonesia ($18.8 billion), and Iran (US$17.1 billion).
Meanwhile, the UAE, China and Italy lead the Fashion Indicator that focuses on the health of the fashion ecosystem a country has relative to its size. Given the importance of digital platforms to this space, a special ‘Muslim Fashion e-commerce‘ focus report looks at developments and hotspots for modest clothing/fashion segments across the globe. DinarStandard estimates put Muslim consumers’ e-commerce expenditure at US$4.8 billion in 2013.
· Tourism market: Global Muslim spending on tourism (outbound) has increased 7.7% to reach US$140 billion in 2013 (excluding Hajj and Ummrah). This is 11.6% of global expenditure and expected to reach US$238 billion by 2019. Top source countries of Muslim tourists based on 2013 expenditure were: Saudi Arabia (US$17.8 billion), Iran (US$14.3 billion), the United Arab Emirates (US$11.2 billion), Qatar (US$ 7.8 billion), Kuwait (US$7.7 billion), and Indonesia (US$7.5 billion).
Meanwhile, the UAE, Malaysia and Singapore lead the Halal Tourism Indicator that focuses on the health of the family-friendly tourism ecosystem a country has relative to its size. A special focus report ‘Hajj & Ummrah travel’ estimates there were a total 5.7 million Hajj and Umrah pilgrims (not including domestic) with total expenditure on Hajj and Umrah at US$16.2 billion (including air travel) in 2013.
· Media & recreation market: Global Muslim spending on ‘recreation & culture’ has grown 7.3% to reach US$185 billion in 2013. This represents 5.2% of global expenditure and expected to reach $301 billion by 2019. Top countries with Muslim consumers’ recreation consumption (based on 2013 data) are: Turkey (US$30.3 billion), Indonesia (US$9.4), United States (US$9.1 billion), Iran (US$9 billion), and France (US$8.4 billion.)
Meanwhile, the UAE, Singapore and the United Kingdom lead the Media & Recreation Indicator that focuses on the health of the famil-friendly/Islamic media & recreation ecosystem a country has relative to its size. A special focus report ‘Islam themed broadcast media’ highlights the Ramadan-drama seris/Musalsalat and various broadcast channel developments driven by much higher (9.9%) projected TV advertising growth for OIC countries between the years 2013-18 than the global average of 5.5% for the same time period.
· Pharmaceutical & Cosmetics market: Global Muslim consumer spending on pharmaceuticals has increased 2.1% to reach US$72 billion in 2013. Top countries with Muslim pharmaceutical consumers are Turkey (US$8.9 billion), Saudi Arabia (US$5.9 billion), Indonesia (US$4.9 billion), and Iran (US$3.7 billion.)
Global Muslim spending on cosmetics increased 1% to reach US$46 billion in 2013. Top countries with Muslim cosmetics consumers are the United Arab Emirates (US$4.9 billion), Turkey (US$4.4 billion), India (US$3.5 billion), and Russia (US$3.4 billion), based on 2013 estimates.
Malaysia, Egypt and Singapore lead a combined Halal Pharmaeutical & Cosmetics Indicator that focuses on the health of the Halal pharmaceutical & cosmetics ecosystem a country has relative to its size.
To view the SGIE report, click here
