More and more companies have also started venturing abroad. Malaysia’ s halal exports in 2015 stood at RM39 billion( approximately US $ 10.02 billion), a big jump from RM24 billion( approximately US $ 6.17 billion) in 2011. The country’ s top export market for halal products over the years has been China, followed by Singapore, the United States, Indonesia, Japan and Thailand.
Today, the Malaysian halal brand is widely recognised and accepted throughout the world, thus reducing the barriers for its halal products to enter the international market. This is a plus given that there is an undersupply situation in the global marketplace as halal producers are estimated to be able to meet only 20 % of existing market demand.
Elsewhere, the services sector also presents Malaysia with an equally exciting prospect. For instance, the global Islamic finance industry has expanded rapidly over the past decade, growing at 10 %-12 % annually. Today, Shariacompliant financial assets are estimated at roughly US $ 2 trillion. The new sources of ethical and economically viable funding for the halal industry can now be unlocked through the availability of Shariacompliant financing.
Doubtlessly, halal has every potential to be a real engine of growth for every local ASEAN economies. Malaysia, Indonesia, Thailand, Brunei, Singapore and the Philippines have put in place a number of government-led initiatives for halal to drive economic growth.
The strength of Malaysia’ s Islamic finance services industry is something that the country can be particularly proud of. Its expertise is very much recognised and sought after by various countries across the globe. Not only are the number of Malaysian companies involved in various international councils tasked to chart the future of Islamic finance rising by the day, the country is committed in developing human capital for this sector and researching ideas in the Islamic finance space.
Despite the challenges facing the world economy – i. e. slower sukuk( Islamic bond) issuance and emergence of new issuers from other countries – Malaysia still managed to maintain its lead in the global sukuk market last year where we accounted for 53 % of global issuance.
As the leader of the sukuk market, Malaysia is indeed in a very firm position to offer a credible, convenient and Sharia-compliant alternative to conventional financing needs. This is a key area which Malaysia needs to continuously build its competencies.
Having said that, maintaining Malaysia’ s position as the global leader of halal industry is no easy task. The knowledge of yesterday might still be useful, but not necessarily sufficient for it to meet the challenges of tomorrow. The onus is now on the country to continue building upon its strong foundation and previous successes.
ISSUE 2: 2016 | ASEAN COMMUNITY OF ENTREPRENEURS
13