ADDRESS BY YANG BERBAHAGIA DATO’ SERI JAMIL BIDIN, CHIEF EXECUTIVE OFFICER, HALAL INDUSTRY DEVELOPMENT CORPORATION (HDC), 3RD ROUNDTABLE 2011 ON GLOBAL HALAL BUSINESS OPPORTUNITIES, MOSCOW
Location Moscow, Russia
Ladies and Gentlemen
First of all, please allow me to take the opportunity to welcome everyone to the 3rd WIEF Roundtable, here in Russia. I would also like to thank the WIEF Foundation for organising this event.
The Halal industry has been touted as a new growth sector in the light of its huge potential in the global market.
The rising affluence of Muslims worldwide and the increasing awareness on halal has created a high demand for halal products and services. In this regard, I would like to emphasise that in referring to halal, the business opportunities are not only confined to the food and non-food sector, but also covers the services sector such as finance and banking, insurance, education and training, research, consultancy, logistics, healthcare as well as tourism.
There are many reasons to go Halal for example the value of the global Halal market is approximately USD 2.1 trillion annually. Most Halal product manufacturers concentrated on markets in the Middle East without realising that the huge potentials in within the non-Muslim countries. Russia, for example with Muslim population is estimated at 16 million represented a huge potential market for halal manufacturers to tap and penetrate.
Malaysia is developing the halal industry in a holistic manner which is aimed at creating a halal “eco-system” and this makes Malaysia uniquely different from others. Halal is a value proposition that exist within key elements of the supply chainof the intersecting industry sectorswhich create greater economic impact.
To best maximize this value proposition it is imperative that all elements of the supply chain are in accordance not only with the principles of Islam but also adhere to globally accepted food standards and practice, hence it is imperative that the traceability of the entire supply chain is effectively captured and documented to ensure full compliance.
The Halal market has been defined as the target markets that can potentially be captured and categorized as fast moving consumer goods (FMCG).The world Halal industry is heading for real growthand has huge potential. The main portion is food and beverage, followed by pharmaceutical, cosmetics and personal care as well as Nutraceutical totaling USD 2.1 Trillion.
The main markets for Halal are indicated in this slide, would be Halal players should focus on countries such Saudi Arabia, France, Russia and Netherlands. Distribution of halal market with Russia contributed to USD 21.7 towards the Halal market. This has made Russia one of major markets for halal goods from western countries as well as Asian countries.
The Malaysian Government sees the halal business as one of the fastest growing global businesses in the world, hence the setting up of the HDC. Valuing the vast potential within the Halal economy, the focus has been on 4 main clusters as the targeted sectors in the halal industry namely Halal specialty processed food, cosmetic and personal healthcare, halal ingredients and animal husbandry.
In the area of specialty processed food some of the key focus areas include confectionary, sauces, dressing and condiments. In addition new untapped growth areas that Halal players should consider is semi processed and canned goods. Interested parties should focus on Europe, primarily Netherlands and France for this new growth area.
The second focus area is cosmetics and personal care.The total market value is US$ 269.76 billion; key products include tooth paste, skincare and hair care. Interested players should also work closely with some of the Halal R&D undertaken in Malaysia in this area.
Some of the initiatives that can be explored in this area include the development of Halal health supplements from collagen, Halal gelatin, as well as food additives such as cysteine for bread making.
The next focus area in Ingredients, the total Market value is estimated at US$ 30.4 billion, added focus should be on products such as sweeteners, herbs, spices, coloring and flavoring.
Industry players should explore new innovations using nontraditional sources of raw materials which might be in abundance in one’s home country, such as palm oil. Some of the developments from this raw material include Lipase used in cheese processing and Coenzymes Q10 used in health supplements.
In the area of animal husbandry, one of the biggest challenges is the adaptability of the livestock to survive outside their traditional habitat, one example is live cattle that are brought from Australia, more often than not it has difficulty adapting to the humid climate of Malaysia, thus affecting the yield. The focus should be on developing breeds that are robust and adaptable. This will ensure that the breeder stock created can be traded as a commodity to countries that are limited in domestic Halal meat cultivation.
The Malaysian Government is fully committed towards making Malaysia a Global Halal Hub withthe development of 20 Halal-dedicated Parks or Halal parks and 9 are already in operation. These Halal Parks are targeted at domestic and International players who intend to use Malaysia as a base for their operations by offering all the amenities and support they need for their business operations. Details of the incentives provided are on the right section of the slide.
On the global sense HDC has and continues to facilitate international linkages between Malaysian players and key International parties. Such initiates include collaborations and trade with such countries as Japan, France, united States of America, Pakistan, and China to mention a few. This slide illustrates some of the programmes that HDC facilitates between Halal industry players and Multinational cooperation’s. This includes industry linkages, market access, focus business missions, and production optimization.
Here we see a representation of an International collaboration between Malaysia and France. The goal is the facilitate trade, key collaborative efforts of knowledge sharing and overall development of both countries Halal production.
HDC has also established the Global Halal Support Centre (GHSC) with the objective to enhance capacity building development; particularly in the areas of knowledge enrichment and human capital development programmes.
The GHSC provides a one stop support for industry players and consumers all over the world in halal-related sectors including fatwa know-how, information on halal certification, capability building, business opportunities and incentives.
Through smart partnership with Smartphone mobile services i.e. iPhone aimed at catering to the needs within the Muslim community wishing to be part of a group sharing the same interests for halal-related information or data using Halal Application.
The collaborations leverage on the strength of the other – HDC for its Halal data warehouse and mobile services for their potentially large base of subscribers. Mobile users are now able to accurately locate halal food premises using the Global Positioning System (GPS) technology and Google Maps.
It is imperative that Key Halal players capitalize on the direct and indirect opportunities derived from Halal Industry. HDC would like to work closely with Russian public and private stakeholders to develop this industry sector.
As custodian, HDC is bound by the prime obligation to constantly educate the public, consumers, investors, entrepreneurs and other Halal-centric players of the holistic concept of Halal by preserving halal integrity along the halal supply chain which relates to quality values from farm to fork which the halal industry can offer to the world.To be successful in promoting the Halal concept to the masses, we need to ensure that all facets of the value chain are integrated, convenient and cost effective
It is hoped that all parties in the halal industrywill continue to make the halal value proposition, a global phenomenal acceptance for both the Muslim and non-Muslim market.
Last but not least, I wish to extend our sincere appreciation to the WIEF foundation for organizing
As well as the Russian Muftis Council (RMC) , Association of Russian Social Organisations (MAJLIS) ,Embassy of Malaysia in Russia , Embassy of Kazakhstan in Russia and MATRADE, Moscow for their support of this initiative.