The Rise of the Halal Industry

The global halal industry is estimated to be worth around USD2.3 trillion (excluding Islamic finance). Growing at an estimated annual rate of 20%, the industry is valued at about USD560 billion a year. Thus, making it one of the fastest growing consumer segments in the world. The global halal market of 1.8 billion Muslims is no longer confined to food and food related products. The halal industry has now expanded beyond the food sector to include pharmaceuticals, cosmetics, health products, toiletries and medical devices as well as service sector components such as logistics, marketing, print and electronic media, packaging, branding, and financing. In recent years, with the increase in the number of affluent Muslims, the halal industry has expanded further into lifestyle offerings including halal travel and hospitality services as well as fashion. This development has been triggered by the change in the mind set of Muslim consumers as well as ethical consumer trends worldwide.

The halal market is non-exclusive to Muslims, and has gained increasing acceptance among nonMuslim consumers who associate halal with ethical consumerism. As such, the values promoted by halal – social responsibility, stewardship of the earth, economic and social justice, animal welfare and ethical investment – have gathered interest beyond its religious compliance. The popularity of, and demand for, halalcertified products among non-Muslim consumers have been on the rise as more consumers are looking for high quality, safe and ethical products.

In lieu of the paradigm shift on global issues such as sustainability, environmental protection, and animal welfare, the potential growth of the halal industry has made it a lucrative market to be tapped into and presenting a major global opportunity. Players from every sector of the industry, from the huge multinationals down to small enterprises, are looking to capture their share of this growing market. In the last decade, the halal industry has undergone further evolution as a market force when governments have started to look at halal in terms of policy formation for developing their own economies.

In South Africa, Cape Town this growth trend has also been identified as a result the Western Cape Government has advertised two tenders as part of Project Khulisa’s plan to grow the Halal industry.

The first calls for a detailed two-phase feasibility study for an Halal Industrial Park, including a full analysis of the Halal industry, mapping of potential opportunities and the evaluation of three proposed sites for the park, at Stellenbosch, Klapmuts and the Cape Town Airport.

Alan Winde, Minister of Economic Opportunities, explained: “Once we’ve reviewed the outcome of phase one, we’ll decide whether to proceed with phase two, which includes the development of a bankable business plan for the park and an in-depth look at some of our halal industry’s most competitive sub-sectors.”

A second tender has been issued calling for a service provider to map the full value chain of the Halal industry. This was with a stated view of assessing supplier gaps, and growing SMME participation in this industry.

Minister Winde said growing the Halal industry was one of Project Khulisa’s key focus areas due to its vast opportunities to increase growth and jobs in our region: “The global halal industry is estimated to be worth around USD2.3 trillion. This industry is growing at an estimated annual rate of 20% and it is one of the fastest growing consumer segments in the world. The Western Cape has the highest number of companies manufacturing halal products. This is why we have this plan of action to grow the size of the province’s Halal industry.”

Minister Winde said the full Halal plan consisted of three additional action steps.

“It is imperative that we put good governance structures in place. This would include the establishment of an intergovernmental work-group and a public-private co-ordinating group.

“Certification is also key. In addition to developing a guide on the current certification standards, we will work with certification bodies to assess the appetite for a single standard which is in line with global market demands.”

Minister Winde said that once the industry was more developed, the development of a promotion strategy for Western Cape Halal would be undertaken.

 

 

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