Malaysia’s halal sector remains resilient through increased consumer confidence, according to the Halal Development Corporation Berhad (HDC), despite global challenges due to the current volatility of oil prices and the COVID-19 crisis.
It was originally forecasted that by 2020, Malaysia’s annual Halal exports would reach an estimated RM50 billion.
In a statement, Hairol Ariffein Sahari, CEO of HDC, said that the Halal industry has much headroom for growth, especially within the landscape of home-grown Malaysian exporters.
“We intend to further augment Malaysia’s market share through our strategic programmes amidst these challenges,” Hairol said, adding that the Halal industry is forecast to contribute 7.4 percent to the country’s GDP by the year 2020.
There were 1,876 Halal exporters in 2019 compared to 1,827 reported in 2018, representing a 2.7 percent increment in growth.
A majority of Malaysian exports are represented by the small and medium industries at 1,430 companies, slightly over 75 percent of the total size, and multi national companies (MNCs) making up the balance of exporters.
“In terms of bilateral trade, China remains as the biggest importer for our Halal products (RM4.69 billion), followed by Singapore (RM4.54 billion), the United States of America (RM2.58 billion), Japan (RM2.35 billion) and Indonesia at RM2.06 billion,” Hairol said.
HDC’s statistics shows that in 2019, Halal food and beverages continued to retain its spot as the top contributor to the domestic Halal economy at RM22.05 billion.
Halal ingredients was next with a contribution of RM12.64 billion, followed by cosmetics and personal care (RM2.95 billion), palm oil derivatives (RM1.26 billion), industrial chemicals (RM917.2 million) and pharmaceuticals (RM400.9 million).
The economic potential of the Halal industry was primarily responsible for galvanising foreign and domestic investments, especially with regards to palm oil production.
“A significant increase in prices of Malaysian crude palm oil per ton was one of the key factors for the Halal industry’s performance in 2019, as the industry experienced a market correction through an increase of over 20 percent as compared to 2018,” Hairol explained.
He also pointed out that the versatility of palm oil as a Halal ingredient for food and non-food products, as well as the Malaysian government’s commitment to the Malaysian Sustainable Palm Oil (MSPO) standards generated significant global interest in palm oil derivative exports, making it a suitable component for Halal manufacturers.
“Furthermore, the versatility of palm oil as a Halal ingredient for food and non-food products, as well as the Malaysian government’s commitment to the Malaysian Sustainable Palm Oil (MSPO) standards has generated significant global interest in palm oil derivative exports, making it a suitable component for Halal manufacturers,” he explained.
As secretariat for Malaysia’s Halal Industry Development Council, HDC holds a critical role within the development of Malaysia’s Halal economy and is set to create linkages between Malaysia and the Halal ecosystems of other nations.
Lastly, Hairol said, “We will connect Malaysia’s Halal ecosystem to the rest of the world, and expect these efforts to create opportunities for both industry players and parties within the ecosystem with a focus on commerce, investments, quality employment, and technology exchange.”