A growing market for ‘Islamic’ goods
A month ago, China invited Pakistan for talks to establish joint ventures in halal food especially in beef, chicken and meat and boost sale of commodities in Islamic countries and Europe. The invitation was extended in May to Pakistani professionals and companies by vice-governor of Ningxia Hui autonomous region.
For non-Muslims, halal is simply a matter of avoiding pork and alcohol, and consuming meat which has been slaughtered in accordance with Islamic law. But the industry has moved well beyond meat.
According to Carla Power of ‘New Statesman,’ it is not just the rise in the number of Muslim consumers that has made halal big business. It is the global nature of the food industry itself. Around 80 per cent of the halal food industry is in the hands of non-Muslims. The Brazilians have been big halal producers for decades. Three-quarters of chickens exported by France are halal. Globalising supermarket chains are starting halal lines; France’s Carrefour even has a halal product co-ordinator to test that its supply chain is halal from farm to fork.
At the exhibition hall during the third annual World Halal Forum (WHF) held at Kuala Lumpur in May, it was amazing to see the Nestlé stall displaying Islamically sanctioned Smarties, PowerBars and Koko Krunch breakfast cereal among other products; Smiling young women dispensed Maggi noodles and ice cream to visitors. The Colgate stall had grinning portraits of its halal committee, which ensures that the toothpaste is free of all animal products.
These products reflect the consumer power of the Muslims settled in the West, whose growing purchasing power and rising sense of religious identity are creating a massive market for “ Islamic goods.” While Saudis or Pakistanis can assume that the food and meat they buy in their markets is halal, simply because they live in Muslim states, but those Muslims living in Leeds or Singapore cannot.
An important task of the WHF, started by Malaysia three years ago in a bid to promote itself as a global halal hub, is to create a consensus on a worldwide standard among the halal certification bodies, whose scholars differ on what halal actually means. But the bickering over standards has not slowed entrepreneurial drive.
Meanwhile, countries such as Croatia have entered the halal business. It plans to increase the number of companies from 20 to 50 producing halal products. Its halal industry caters to 80,000 Muslims at present and is looking to export to Asian countries.
Malaysia is a leading halal goods exporter in the world. Its exports to OIC countries are projected to rise by 20 per cent to reach 0.70 billion dollars this year. It also sells halal products to China and France. Some investors from UAE and Canada are currently exploring potential of halal business in the Philippines, particularly in Mindanao region. A senior official said Manila intended to set up a laboratory and a science research centre this year in Mindanao which will certify the halal products.
During the past eight years, the number of halal-certified businesses in Singapore has grown from 530 to 2000. There is still more scope for growth as the spending power of the Muslims in Singapore is going up. In the United States, halal meat business was established long ago. With the spread of mosques, halal grocery stores also became popular among the Muslim community in North America.
Although the halal market is globally the fastest growing industry, many consumers feel that the companies must ensure that the products they sell to the growing Muslim population were certified halal and were Shariah compliant. In this competitive market, only those companies can survive which make sure that all of their products were fully Halal.
The fact remains that halal business is fraught with marketing headaches, mostly caused by fears among its consumers about the fairness of products being marketed as halal. In 1997, according to Washington Post, US Agriculture Department’s Food Safety and Inspection Service fined Washington Lamb Inc. in Springfield $15,000 for fraudulently mislabelling and selling ordinary meats as halal, after the owner pleaded guilty to related charges in US District Court in Alexandria. And it is because of similar problems that California, New Jersey and four other states later enacted laws fining anyone who sells or advertises meat as halal when it is not.
The USA Halal Chamber of Commerce distributes information about halal meat and non-meat products among the companies. The group has 30 members, mostly meat and poultry companies. Part of the problem is that there is no standard authority to certify halal meat and poultry. Slaughterhouses that sell halal meat are inspected by the Agriculture Department, but the agency oversees only food safety issues.