Nobody Wants to Miss the Halal Business Boat

Prospects of the halal business are so enormous that they have prompted non-Muslim majority ASEAN countries – notably Thailand, the Philippines and Singapore – to jump onto the bandwagon.
Japanese noodles and seaweed are a step closer to being exported to Muslim countries after an official signing of an agreement with Thailand’s National Food Institute that aims to bring investment from companies interested in halal certification. According to the NFI president, Yongvut Saovapruk, Japanese companies have been increasingly interested in Thailand’s halal potential and were looking to invest in its Islamic food industry. The country now ranks ninth for halal food exports and has its own established market, particularly in the largely Muslim southern provinces notably . “The Japanese are not familiar with halal food which requires a deliberate process including acquiring the raw materials, the cooking process and cooking standards that have to match specific religious requirements,” he explained. “By changing some of the procedures, the same product can be sold to a broader group of customers in those growing Muslim communities.”

Yongvut signed the memorandum of understanding (MoU) with officials from Japan Halal Development and Promotion, a government agency for boosting halal food standards in Japan and promoting Japanese food products in Muslim countries. Under the terms of the MoU, the NFI will assist Japanese investors to gain the official halal trademark from the Central Islamic Council of Thailand. Halal food accounts for roughly one-third of Thailand’s overall foods exports which amounted to 897 billion baht (US$25.43 billion) in 2015.

Moreover, Thailand’s Industry Ministry has budgeted 180 million baht (US$5.1 million) to promote exports of halal products for fiscal 2016. The department will also expedite development plans for halal products of small and medium enterprises (SMEs) and on a One Tambon, One Product (OTOP) basis to propel Thailand into becoming the world’s top five halal exporters by 2020. The Industry Ministry has allocated 120 billion baht (US$3.4 million) for the National Food Institute (NFI) and 60 billion baht (US$1.7 billion) to the Department of Industrial Promotion, some of which will be allocated to the Central Islamic Council of Thailand to fund the certification operations for halal food products which currently cover more than 5,000 companies.

With growing consumer acceptance and recognition of Thai halal foods, exports of these products should continue to expand this year. The rising world Muslim population will also raise demand for hygienic and high-quality halal foods. With the rapid expansion of e-commerce, development of a halal certification system and the government’s five-year plan to support and promote halal-food exports, there is hope of the kingdom becoming a top-five halal exporting nation by 2020.
Meanwhile, the Philippines is working tirelessly to formulate regulations for the export and trade of halal products, processes and services; the promotion of halal products to the global market; the implementation of research and development programmes; and the facilitation of training and capacity building for farmers and manufacturers, among others.

The Department of Trade and Industry’s (DTI) Export Marketing Bureau Senate Bill or the Philippine Halal Export Development and Promotion Act Of 2015 aims to create the Philippine Halal Export Development and Promotion Programme as well as the Philippine Halal Export Development and Promotion Board.

The new policies will also seek to establish the accreditation process of halal certifying bodies – through the Philippine Accreditation Bureau – and to develop Philippine National Standards for halal through the Department of Agriculture’s Bureau of Agriculture and Fisheries Standards (for primary and post-harvest foods), the Department of Health Food and Drug Administration (for processed and prepackaged foods, drugs and cosmetics) and the Department of Trade and Industry’s Bureau of Philippine Standards (for non-food products aside from drugs and cosmetics).

National Meat Inspection Service Director Minda Manantan said three halal meat-processing facilities have already been accredited in the Philippines, while data from the DTI showed there are already 514 halal-certified companies. A study conducted by the Dubai Chamber of Commerce and Industry showed that the global halal market is projected to grow to US$1.6 trillion by 2018. Of this amount, halal food trade alone contributes US$630 billion.
With stringent food safety and its widely recognised halal standards by several Gulf countries and ASEAN neighbours, even secular and Muslim minority Singapore is well-positioned to ride on the growing demand for halal products and services globally. This includes demand from the emerging Muslim tourism markets such as Japan and South Korea where halal products and services are not as well developed.

Majlis Ugama Islam Singapura (MUIS), the primary halal-certifying and ritual cleansing body in Singapore, authorises seven types of schemes from products and eating premises to central kitchens, factories and poultry abattoirs. In 2014, TFK Corporation, a Japanese subsidiary of Singapore Airport Terminal Services (SATS), became the first company overseas to be issued halal certification (for its central kitchen in Tokyo’s Narita Airport) by Warees Halal, a company limited by guarantee that MUIS formed in 2014 to strengthen its halal inspection arm.

In the same year, just over S$4 million (US$2.95 million) in income was derived from halal certification in Singapore – up from S$2.98 million (US$2.19 million) in 2013, according to MUIS’ 2014 annual report. There has also been a five-fold increase in halal-certified premises in the last 15 years – from 533 in 2000 to 2,941 in 2014.

What’s interesting about Singapore is that even though it is a secular country, it is empowered by the AMLA (Administration of Muslim Law Act which came into effect in 1968) that seeks to protect the halal industry. This ensures the legality and genuineness aspects of the halal framework.

With the ASEAN Economic Community (AEC) formed, Singapore will have the opportunity to position itself strategically in fronting the halal market. Given that the republic lacks its neighbours in terms of manufacturing capacity – it can certainly offer that fundamental service that will educate and bring companies into the halal market. Singapore currently has over 10 active halal consultancy firms – about three of which are non-Muslim firms – that help companies attain halal certification locally and globally.