STATUS OF THE HALAL INDUSTRY

by:

Y.B. Dato’ Sri Mustapa Mohamed

Minister of International Trade and Industry

2 February 2016

‘Driving Transformation, Powering Growth’

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The global interest in Halal is growing

UAE: Aim to be the Sharia-compliant centre of the world.

Focus will be on Islamic Banking and Halal businesses

Japan : Halal as one of the key source of contributors to Japan’s economy by 2020

Brazil: World’s second top exporter of meat and poultry to Muslim-majority countries after

the Australia

USA: Halal market is estimated at USD18 billion

UK: Halal food imports are valued at about GBP18 billion

per annum.

China: Set to become the net importer of food products,

including Halal F&B by the next decade

Malaysia: Halal exports in 2014 were more than USD11

billion. Largest exporter of Halal ingredients. Export

destinations: China, USA, Indonesia and Japan

Thailand: The domestic halal food market grows around 20

percent a year. 8,000 companies involved in halal

food production

Malaysia is still the leader

Source: Global Islamic Economic Report (Thompson & Reuters)

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Malaysia

• Proper ecosystem

• Proper industry development framework

• Dedicated government agencies

• Diverse (food, non-food and services)

• Comprehensive and reliable data /information through the Global HalalSupport Centre i.e. Halal exports,investment, employment, establishmentetc.

Others

• Focus on production and certification

• Not available

• Except UAE, the rest led by NGOs /religious bodies

• Concentrate on food and meat products

• Little data available

Only Malaysia has a comprehensive institutional framework to drive Halal development agenda

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It’s a collaborative effort among the key stakeholders

Investment Promotion

Export Promotion

SME Development

FOCAL POINT Certification & Enforcement

Standards Development

PRIME MINISTER’S DEPARTMENT

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Employment in Halal

Number of exporters (SMEs)

Halal export revenue

Macro-economic KPIs (2020)

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A new source of economic growth

Global reference centre for Halal integrity (Standards, Certification, Training, etc.)

Specialty Processed

Food

Cosmetics and

Personal Care

Ingredients Livestock

Legislation and regulatory framework

Human capitalPhysical

infrastructure and connectivity

Funding and incentives

Industry standards and certification

Public sector delivery system

Services –logistics, Tourism,

Healthcare

The development framework

Achievements(2015)

= RM19 billion

= 300,000 jobs

= 1,600 companies

RM42 billion

218,000 jobs

800 companies

HIMP 2006 - 2020: Target and Achievement

Forecasted

Note: 206,000 in 2014

Note: 700 in 2014

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Halal Companies in Malaysia: 5,726

2336

3320

4443

5415

2011 2012 2013 2014 2015

Number of Halal Certified Companies

33%

67%

2014

Bumiputera Non Bumiputera

32%

68%

2015

By ownership

Source: Bahagian Hab Halal JAKIM

5,726

• Major products certified halal in 2015:• Food products - 76.87%• Non-Food Products - 23.13%

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3233

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2011

RM billionKey Export Destinations

China

Singapore

United States

Indonesia

Japan

RM4.0 billion

RM3.4 billion

RM2.4 billion

RM2.3 billion

RM1.9 billion

Food & beverages

Cosmetic & Personal Care

Industrial Chemical

Main products Value

Ingredients

Palm Oil Derivatives

Halal Export (2015f): RM42 billion

Forecast

2012 2013 2014 2015

Source: Halal Product Statistic Coordination Committee

+11% increase compared to 2014

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RM1.3b

RM0.03b

RM0.1b

RM1.7b

RM0.9b

Investment in Halmas Halal Park:

RM10.6 billion

• Foreign : RM5.6 billion (27 companies)• Domestic: RM5.0 billion (105 companies)

• Full income tax exemption for 10 years• Import duty exemption• Double deduction on qualifying expenditure

Main incentives for Halal players:

Main new investors in 2015:

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Success Stories: Investment

RM552 million

RM323 million

RM150 million

RM100 million

FOOD

Since 2010

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Success Stories: HALMAS Status Halal Park Parks

Techpark @ Enstek

Key Halal Parks

4,312

Investment (2010 – 2015)RM million

Selangor Halal Hub 1,805

Tanjung Manis Halal Hub 1,802

POIC Tanjung Langsat

PKFZ Halal Flagship Zone

Penang International Halal Park

1,466

575

484

Melaka Halal Park 119

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3

1

5

6

4

7

Others 3648

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Success Stories: Local Large Corporations

RM1 billion sales in 2015

• 5 shops and 11 Halal kiosks • 25,000 stalls

RM350 million sales in 2014

• Footprint in USA, Japan and Australia

• 4,000 employment

RM320 million sales in 2014

• Footprint in Thailand, Philippines, Singapore, Indonesia and British Virgin Island

RM3.9 billion sales in 2014

• 1,266 outlets (Singapore, Brunei, Cambodia and India)

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Success Stories: MNCs

Make Malaysia as Halal Centre of Excellence

• 7 Nestle Halal factories in Malaysia.• 150 Nestle Halal factories globally – exporting to more than 50

countries.

• “World first Halal Vaccine production facility in Malaysia”• RM550 million investment in Halal Park

• RM300 million investment in Halal Park.• 600 employment created.

• RM500 million investment in Halal Park.• 150 employment created

• RM1.2 billion investment in Halal Park.• 800 employment created.

Key MNCs

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Out of 2,400 companies participated, 40% reported double digit growth.

Activities

Halal and Global Best Practices

Equipping the workforce with the right knowledge, skills & tools

Business Linkages

Creating demand, connecting opportunities and facilitating trade

Access to Financing

Providing advisory and facilitating financing application

Branding and Promotions

Increasing consumers’ confidence and strengthening halal value

proposition

Success Stories: Halal Business Transformation (SME)

A nurturing programme for local Halal companies -Increase competitiveness and business performance

Achievement

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Success Stories: SMEs under HBT

Akmal Food

100%

Contract Received:• Tesco• GIANT, • AEON Jusco• AEON Big, • Mydin

Sales:(2012 vs 2014)

Hajjah Aminah

87%Contract Received:• GIANT, • AEON

Anjaad Manufacturing

Contract Received:• AEON Jusco• Mydin 57%

Sales:(2012 vs 2014)

Sales:(2012 vs 2014)

Fatihah Frozen

Contract Received:• Tesco• GIANT• AEON Big • Mydin

17%

Sales:(2012 vs 2014)

Ryverra Chocolate

Contract Received:• Mydin• AEON 23%

Sales:(2012 vs 2014)

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Knowledge GatheringKnowledge Analysis

Knowledge Dissemination

One Touch Point

Services Offered

33 million global visitors’ (physical & on-line) utilization:

150 COUNTRIES

Launched by the YBM in 2012

New Products:

Achievement:

Success Stories: Global Halal Support Centre

GHSC positions Malaysia as the

Global Reference Centre for the world

HALAL IP EXCHANGE

HALAL EMPLOYMENT PORTAL

Objective:

Note: 32 million in 2014

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Partners

To increase the number of knowledgeable personnel in sharia compliance, industry and science

Achievement

7,500 Halal Knowledge Personnel

Success Stories: Halal Talent Development

Objective

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Halal Certification Bodies

Source: Bahagian Hab Halal JAKIM

• There are about 200 different Halalcertifications available globally. Themajority of certifications stems fromAsia Pacific countries

• As of January 2016, JAKIM hasrecognised 54 Foreign CBs from 32countries covering all regions. 8CBs from Australia and 2 from NewZealand

• Products and goods certified by thoseCBs are allowed to be exported andmarketed in Malaysia under TradeDescriptions Act (Certification andMarking of Halal Order) 2011

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Going Forward RMK-11

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FOCAL POINT Institution for Industry Development

INDUSTRY DEVELOPMENT

FOCAL POINT

COORDINATION OF AGENCIES

SUPPORT FUNCTION IN HALAL SERVICES

Key Roles Details

Central implementation agency for key industrydevelopment initiatives• Oversees implementation of development initiatives• Works with relevant authorities and companies to

address gaps identified• Promotes industries and liaises with investors and

other relevant parties

Referral agency for implementation of initiatives• Specifies key agencies involved and outlines roles and

responsibilities of each

Coordinates the agencies’ activities andorganizes discussion sessions (e.g. R&DAdvisory Council etc.)

Branding and promotion of products/industriesand of Halal

Training and consultancy services in Halal tosupport certification

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2)

1)

2)

1)

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Governance Structure

JAWATANKUASA KHAS KABINET PEMBANGUNAN & PENGURUSAN

INDUSTRI HALAL MALAYSIA

JAWATANKUASA KHAS KABINET PEMBANGUNAN & PENGURUSAN

INDUSTRI HALAL MALAYSIA

DEPUTY PRIME MINISTERDEPUTY PRIME MINISTER

Secretariat: JAKIM &

MITI (HDC)

Secretariat: JAKIM &

MITI (HDC)

Secretariat: JAKIM &

MITI (HDC)

Secretariat: JAKIM &

MITI (HDC)

JAWATANKUASA PEMANDUINDUSTRI HALAL MALAYSIAJAWATANKUASA PEMANDUINDUSTRI HALAL MALAYSIA

MINISTER IN PRIME MINISTER’S DEPARTMENT & MINISTER OF INTERNATIONAL TRADE AND

INDUSTRY

MINISTER IN PRIME MINISTER’S DEPARTMENT & MINISTER OF INTERNATIONAL TRADE AND

INDUSTRY

JAWATANKUASA PENASIHAT PENSIJILAN

HALAL

JAWATANKUASA PENASIHAT PENSIJILAN

HALAL

Secretariat: JAKIMSecretariat: JAKIM

DIRECTOR GENERAL OF JAKIM

DIRECTOR GENERAL OF JAKIM

JAWATANKUASA PENASIHAT

PEMBANGUNAN INDUSTRI HALAL

JAWATANKUASA PENASIHAT

PEMBANGUNAN INDUSTRI HALAL

Secretariat: HDCSecretariat: HDC

SECRETARY GENERAL OF MITI

SECRETARY GENERAL OF MITI

Tier 1

Tier 2

Tier 3

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Halal Malaysia Internationalisation

Desired Outcome

Malaysia as the Global Reference Centre

Malaysia as the global leader in the innovation,

production and trade of a number of Halal-related

sectors

Integrity

• Development of Global Talent• Employment for the Halal

Industry• Leadership in Halal knowledge

Industry Development

• Halal Investment fund• End-to-end Pipeline Management• Bumiputera Economic Community

Agenda• Halal Innovation • Halal Investment Promotion • Halal Trade

Brand Development

• Positioning leadership in Halal

Hosted by:

Organised by:

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Dubbed the biggest international halal event, WorldHalal Week brings together industry players,certifiers, scholars, academics and consumers inthree key events: the Malaysia International HalalShowcase (MIHAS), the World Halal WeekConference (WHC) and the International HalalCertification Bodies Convention.

When : 28 March – 2 April 2016Where: Kuala Lumpur Convention CentreTheme: Beyond The Economy

OVERVIEW

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HALAL CERTIFICATION BODIES CONVENTION

The 7th JAKIM International Halal Certification Bodies

Convention will convene more than 55 JAKIM

recognised Halal certification bodies (CBs), which is

meant to strengthen cordial relationship, and

exchange opinions on Halal certification issues based

on the Malaysian Halal Standard and experience.

When: 28 – 29 March 2016 (Monday – Tuesday)

Where: Marriot Putrajaya Hotel

Theme: Towards New Dimension of Halal

Target Audience: Recognize Halal Certification Bodies

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Date 30 March – 2 April 2016 (Wednesday – Saturday)

Time 10.00 am – 7.00 pm

Venue Exhibition Hall 1-6, Ground Floor, KLCC

Format Trade fair

Hosted by Ministry of International Trade and Industry (MITI)

Organised by Malaysia External Trade Development Corporation (MATRADE)

Managed by Shapers Malaysia Sdn. Bhd. (SHAPERS)

In Association with Halal Industry Development Corporation (HDC) and Department of Islamic Development Malaysia (JAKIM)

Sectors represented Halal Consumables, Halal Certified Premises, Non-Food Products & Services, Food Packaging, Machinery & Catering Equipment, Government Agencies & Associations, Islamic Investment, Banking & Takaful

Expected Companies • 550 companies (484 companies confirmed as at 29 Jan 2016)

Expected Visitors • 25,000 people

Expected Booths • 640 booths

Expected Countries • 28 countries

Expected Visiting Countries • 67 countries

FAST FACTS ON MIHAS 2016

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MIHAS 2016 (as of 20 January)

Total Number of Booths 543 booths

Local Booths 260 booths

International Booths 283 booths

Total Booths Offered 640 booths

Total Number of Companies

484 companies

Local Companies 204 companies

Bumiputera Companies 133 companies

Non-Bumi Companies 71 companies

International Companies 280 companies

MIHAS 2016 30 MARCH – 2 APRILKuala Lumpur Convention Centre, KLCC“EXPERIENCE HALAL”

MIHAS 2016 (as of 20 January)

No of Participating

Countries25 countries

Major Participating

Countries

• Thailand (56 companies)• China (34 companies)• Indonesia (30 companies)• Taiwan (28 companies)• South Africa (26 companies)

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OIC @ MIHAS 2016

TOTAL 53

Iran 16

Turkey 16

Palestine 8

Pakistan 6

Bangladesh 4

Saudi Arabia 2

Tunisia 1

ASEAN @ MIHAS 2016

TOTAL 303

Malaysia 204

Thailand 56

Indonesia 30

Philippines 8

Vietnam 4

Singapore 1

MIHAS 2016 30 MARCH – 2 APRILKuala Lumpur Convention Centre, KLCC“EXPERIENCE HALAL”

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FAST FACTS ON WHC 2016

Date 30 March – 31 March 2016 (Wednesday – Thursday)

Time 10.00am – 7.00 pm

Venue Ballroom 2, Level 3, Kuala Lumpur Convention Centre

Theme Halal at the Forefront of Economic and Social Change

Format Main Conference with Ministerial Panel, Ambassadors Panel,Special Address Session, Plenary Sessions on specificcomponents and emerging areas and Business NetworkingGalleria.

Hosted by Ministry of International Trade and Industry (MITI)

Organised by Halal Industry Development Corporation (HDC)

In Association with • Malaysia External Trade Development Corporation(MATRADE)

• Department of Islamic Development Malaysia (JAKIM)

Expected Participants

Targeted to attract close to 1,000 participants from more than 50 countries

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OUTCOME FROM WHC 2015

• 1 - 2 April 2015.

• The WHC 2015 theme “Halal Economy: A Profitable Convergence” demonstratesthe importance of the “know how” on converging the Halal industry and the Islamicfinance. The conference comprised six subject-focused forums featuring intensiveand empowering dialogues with 80 influential speakers to map out future globalHalal developments.

• Attended by 1,341 high profile delegates from 54 countries including H.E. Mr.Nurettin Canikli, Minister of Customs and Trade of Turkey, H.E. Dr. Rashid AhmedMohamed Bin Fahad, Minister of Environment and Water of United Arab Emiratesand H.E. Mrs. Apiradi Tantraporn, Deputy Minister of Commerce of Thailand.

• Halal Excellence Award was presented at the Appreciation Dinner to honor anorganization that has excelled and contributed significantly to the growth of the halalindustry. Chemical Company of Malaysia Berhad (CCM) was the recipient for HalalExcellence Award.

• PR Value garnered: RM 15 million

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Australia Fiji Islands

Papua New GuineaSolomon Islands

Canada USA

ArgentinaBrazilChile

Uruguay

BangladeshIndia

MaldivesPakistanSri Lanka

Ecuador

AustriaBelgium

Bosnia Herzegovina DenmarkGeorgiaRomaniaRussia

UK

China JapanKorea

Taiwan

BruneiIndonesia

Laos Philippines Singapore ThailandVietnam

AzerbaijanIran

KuwaitKyrgyzQatar

Saudi ArabiaTurkey

UAE Yemen

EgyptGhana

LesothoLibya

South AfricaZambia

Zimbabwe

Malaysian Delegates International Delegates Total

820 521 1,341

WHC 2015 CONFERENCE DELEGATES (1,341)

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Thank you

MITI AGENCIES

Ministry of International Trade and IndustryNo. 7, Menara MITI,

Jalan Sultan Haji Ahmad Shah,50480 Kuala Lumpur, Malaysia.

Tel: 603-8000 8000 | Fax: 603-6201 2337Email: webmiti@miti.gov.my | Website: www.miti.gov.my

Special thanks to: