The halal demand surge has sparked significant investment in the sector, driving growth and opportunities for businesses worldwide. Amer Bukvic, the acting chief product, and partnership officer of the Islamic Development Bank (IsDB), has stressed the investment potential opening up due to the escalating demand for halal products and services. He suggests that this demand could pave the way for greater investment opportunities in the halal industry, as well as expand trade networks for halal goods both within member countries and global Muslim communities.
Bukvic shared these insights at the IsDB annual meetings held in Jeddah. He highlighted the immense value of the halal food sector, which was estimated at $1.27 trillion in 2021 and is projected to reach $1.67 trillion by 2025. This makes it the largest component of halal consumption by Muslims worldwide.
Building a sustainable halal industry in IsDB member countries, Bukvic noted, necessitates the creation of an enabling ecosystem at the national level. This would involve the implementation of long-term strategies that support policies for fostering qualified human capital, establishing an institutional framework for standardization, certification, and accreditation, and promoting awareness programs for various stakeholders and consumers.
Additionally, Bukvic urged the adoption of new technologies to streamline the halal manufacturing and distribution process. This would not only enhance efficiency but also boost visibility and consumer trust. He emphasized the need to overcome two key challenges facing the halal economy: financing the halal industry and managing the halal supply chain effectively.
Several IsDB member countries, such as Malaysia, the UAE, Saudi Arabia, and Turkey, are proactively developing their halal economies to tap into the market’s potential. These nations envision themselves as future global hubs for halal trade.
Interestingly, even non-majority Muslim countries like Thailand, Japan, and South Korea are seeking to establish themselves as significant players in the halal market. Countries such as Australia and Brazil, meanwhile, are major suppliers of halal meat and poultry to the Middle East. As the needs of the halal-conscious consumer market continue to rise, businesses face unique challenges and opportunities in catering to this expanding demand.
Fahad Al-Nuhait, CEO of the PIF-funded Halal Products Development Co. (HPDC), disclosed that the company has its sights set on investing in all stages of the halal aquatic sector domestically. This move aims to capitalize on opportunities for sustainable integration across Saudi Arabia and the supply chain.
On the global stage, Al-Nuhait said, “We strive to position the Kingdom as a center of the halal products industry, contributing to multilateral growth in target markets.” The HPDC is actively seeking to forge partnerships with key stakeholders in the health sector both within and outside Saudi Arabia. This partnership aligns with HPDC’s initiative to bolster the halal sector and is expected to uplift and enhance the halal poultry sector in the Kingdom.
On a similar note, Hairol Ariffein Sahari, CEO of Halal Development Corp. Malaysia, estimated the global halal market size to reach $5 trillion by 2030. He stressed the importance of collaborative efforts among halal stakeholders and IsDB member countries to capitalize on this market growth.
HDC and IsDB have undertaken an economic assessment of halal ecosystems to gauge the manufacturing and production readiness of IsDB countries. This aims to promote self-reliance, especially in producing industrial goods, including food, beverages, pharmaceuticals, and personal care.
In conjunction with the IsDB annual meetings, an event titled “Unlocking IsDB Member Countries’ Potential to Tap into the Vast and Expanding Global Halal Industry” was held. This event was part of a private sector forum designed to underscore the importance of halal business in fostering the social and economic development of IsDB member countries and Muslim communities in non-member countries.
Ahmed Osilan, executive board member and managing director of Tanmiah, emphasized that Saudi Arabia, being at the heart of the Islamic world possesses significant investment capabilities and enjoys geographic proximity to more than 500 million consumers in neighboring markets.
Osilan pointed out an interesting fact during a panel discussion: “Eighty percent of the halal market products are produced in countries that are not necessarily majority-Muslim. This presents a unique opportunity for us, as players in the halal market, to provide high-quality products not only to the Islamic bloc but also to non-Muslims who appreciate the value of halal products.”
The event culminated in the signing of a memorandum of understanding between the IsDB and the HPDC. This agreement highlights the opportunities within Saudi Arabia’s halal sector and the halal industries of the IsDB’s member countries. Three main objectives were identified: localization of the halal products industry in Saudi Arabia, enhancing the capabilities of the sector at the regional level and exploring opportunities for exporting halal products from the Kingdom to the world.
Overall, the conversations and collaborations initiated at this event underscore the growing importance and potential of the halal industry in shaping the global economy, and the pivotal role of the IsDB member countries in this development. Stay informed about the latest trends and developments in this rapidly expanding industry driven by the halal demand surge, and explore how businesses are adapting to meet the evolving needs of halal consumers.
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