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HALAL ECONOMY

How to Avoid Haram Money in Today’s Global Economy

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In today’s fast-paced world, where business and investments move across borders in the blink of an eye, it’s becoming harder for Muslims like us, who care about living by Islamic principles, to avoid haram (forbidden) money. Islam teaches us the importance of earning halal (permissible) income through ethical means, but with the complexity of modern financial systems, it’s not always easy to tell what’s truly halal or haram. Many of us are left wondering how to protect our religious values while navigating the financial world.

Let’s break down what haram money is, why it’s important in Islam, and how we can approach today’s financial systems, investments, and Islamic banking to ensure we’re earning in a way that aligns with our faith. This is a vital issue for anyone serious about maintaining their religious integrity in financial matters.

What is Haram Money?

Haram money is income that is earned through means prohibited by Islamic law. This includes money gained from activities like gambling, interest (riba), or the sale of forbidden items such as alcohol or pork. Earning or using haram money is considered a major sin in Islam, and believers are instructed to seek halal alternatives.

Haram money sources could be the following.

  • Interest (Riba): One of the most well-known prohibitions in Islam, earning money through interest is strictly forbidden. Whether it’s personal loans, mortgages, or investments that accrue interest, this form of income is considered haram.
  • Unethical Business Practices: Engaging in deceit, fraud, or exploitation in business dealings is also haram. This can include cheating customers, monopolistic behavior, or unfair trading practices.
  • Gambling (Maisir): Any earnings from games of chance, such as lottery tickets, betting, or casinos, are forbidden.
  • Alcohol, Drugs, and Pork: Islam prohibits the consumption and sale of alcohol, intoxicating substances, and pork, making any income generated from these activities haram.
  • Investment in Haram Industries: Many industries, such as pornography, arms dealing, and others that harm society, are deemed haram.

Consequences of Earning Haram Money

Islam teaches that earnings should not just be halal but also pure (tayyib). Accumulating wealth through haram means can have spiritual, social, and financial consequences:

  1. Spiritual Consequences: According to Islamic teachings, haram income can negatively impact a person’s relationship with Allah. Money earned through forbidden means taints a person’s worship, such as their prayer and charity.
  2. Social Impact: Engaging in unethical practices for personal gain can harm communities. It leads to distrust and inequality, ultimately damaging the moral fabric of society.
  3. Financial Barakah (Blessing): Many Muslims believe that earnings from haram sources lack barakah, meaning they will not bring long-term prosperity, satisfaction, or success.

Challenges in Avoiding Haram Money Today

With the rapid globalization of markets, avoiding haram income can seem overwhelming. Some of the key challenges Muslims face today include:

  1. Interest-Based Financial Systems: The majority of conventional banks operate on an interest-based system. For Muslims seeking to avoid riba, opening a savings account, securing a loan, or even maintaining a checking account in these institutions can pose problems.
  2. Stock Market Investments: Many companies listed on global stock markets engage in haram activities, either directly or indirectly. For instance, tech or food companies may invest in gambling subsidiaries or sell products derived from haram sources like pork or alcohol.
  3. Employment in Mixed Environments: Working for organizations that deal with haram products or services, such as insurance companies or alcohol distributors, can make it hard for a Muslim to ensure all their income is halal.
  4. International Transactions: Given the complexity of global trade, sometimes even simple purchases, investments, or business partnerships can have elements of haram involvement that are difficult to identify.

How to Avoid Haram Money: Practical Strategies

  1. Educate Yourself on Halal and Haram Transactions The first step in avoiding haram income is understanding the boundaries set by Islamic law. This means learning about what is permissible in business, finance, and employment. Consult with scholars, read reliable Islamic finance books, and stay updated on modern economic issues from a Shariah perspective.
  2. Choose Islamic Banking Islamic banking systems operate by Shariah law and offer Muslims an alternative to conventional, interest-based banks. These institutions offer profit-and-loss sharing accounts, Shariah-compliant loans, and ethical investment options. Some globally recognized Islamic banks include Al-Rajhi Bank, Bank Islam Malaysia, and Dubai Islamic Bank.
  3. Invest in Halal Stock Market Funds There are Shariah-compliant investment options available that allow Muslims to invest in halal stocks and avoid haram industries. Islamic finance experts have developed Shariah screening tools to filter out stocks that generate income from interest, gambling, alcohol, and other forbidden activities. Halal mutual funds and ETFs (Exchange Traded Funds) are also gaining popularity.
  4. Verify the Source of Your Earnings Whether you are self-employed, a business owner, or an employee, it’s essential to scrutinize the source of your income. If you’re an employee, ask about your company’s involvement in activities that could be haram. If you’re a business owner, ensure your business dealings uphold Islamic principles.
  5. Avoid High-Risk or Speculative Investments Gambling is haram, and many forms of modern high-risk investments can fall into this category. Day trading, forex trading, and binary options often involve a level of risk and speculation akin to gambling. Islamic teachings advise caution and warn against speculative ventures (gharar).
  6. Opt for Interest-Free Loans Seek alternatives to interest-based loans for personal and business financing. Some Islamic banks offer interest-free loans or loans based on profit-sharing principles (Mudarabah or Musharakah). Moreover, some communities have set up cooperative societies that offer Shariah-compliant microloans.
  7. Support Ethical Businesses Whenever possible, choose to support ethical and halal businesses. Whether it’s buying products or services, investing in companies, or entering partnerships, ensure the businesses align with Islamic values. The global halal economy is growing, and there are more halal-certified products and services than ever before.
  8. Keep Up with Technology and Modern Financial Solutions Technology has enabled Muslims to better identify and avoid haram income. There are now apps and software that analyze financial products and services for Shariah compliance. For instance, apps like Zoya or Wahed Invest help you make informed decisions on halal investments.
  9. Consult with a Shariah Advisor If you are unsure whether certain financial practices or business dealings are halal or haram, consulting with a qualified Shariah advisor is recommended. They can provide tailored guidance and help ensure your income remains within the boundaries of Islamic law.

The Role of Taqwa in Financial Decision-Making

One of the most important tools for avoiding haram money is practicing taqwa or mindfulness of Allah. By fostering a constant awareness of Allah in all dealings, Muslims can be more cautious and deliberate in their financial choices. Taqwa serves as an inner compass that guides Muslims away from doubtful matters and towards actions that align with Islamic ethics.

In today’s fast-paced, complex economy, it’s easy to slip into grey areas where halal and haram may seem indistinct. However, with the right knowledge, vigilance, and guidance, Muslims can navigate these challenges effectively and maintain their commitment to earning lawful and pure income.

Avoiding haram money in today’s interconnected global economy is no simple feat. The challenges are real and multifaceted. But with clear Islamic principles, accessible resources, and modern Islamic financial products, it is possible to stay true to the path of halal earnings.

By being conscious of where your money comes from, seeking Islamic alternatives, and continuously educating yourself, you can thrive financially while staying within the bounds of your faith. Above all, remember that the key to barakah in wealth is through honesty, ethical conduct, and following the guidance of Islam.


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HALAL ECONOMY

Malaysia Becomes Top Destination For Muslim Tourists

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Malaysia has emerged as one of the world’s leading destinations for Muslim tourists, offering an ideal blend of cultural diversity, beautiful landscapes, and robust halal-friendly services. With its commitment to developing halal tourism in Malaysia, the country has become the top choice for Muslim travelers looking for destinations that cater to their spiritual and lifestyle needs. The increase in Muslim tourist arrivals is not just a trend but a deliberate outcome of government policies, private sector initiatives, and the country’s unique cultural offerings. This article delves into the factors driving Malaysia’s rise as a premier Muslim-friendly tourist destination and highlights essential attractions that make the country so appealing to millions of travelers every year.

Why Malaysia is Best for Halal Tourism

Malaysia’s success in halal tourism is no accident. It is a well-coordinated effort driven by the government, private companies, and local communities to meet the specific needs of Muslim travelers. The country’s diverse attractions, coupled with an extensive halal infrastructure, make it a standout destination in the global Muslim-friendly tourism market. Here are the key reasons why Malaysia has become a favorite for halal-conscious tourists:

1. Comprehensive Halal Certification

Malaysia’s halal certification system is among the most recognized and trusted globally. The Department of Islamic Development Malaysia (JAKIM) ensures that food and products meet stringent halal standards, providing Muslim tourists with the assurance that they can enjoy their meals without any concerns. The widespread availability of halal food is a crucial factor, with nearly every city and town offering halal-certified eateries. From upscale halal restaurants to hawker stalls and hotel kitchens, the range of options available ensures that tourists experience the richness of Malaysian cuisine without compromising their dietary requirements.

The country’s multicultural culinary scene also enhances its appeal. Muslim tourists can enjoy diverse dishes, from traditional Malay cuisines like Nasi Lemak and Rendang to halal versions of Chinese, Indian, and even Western foods. The ease of finding halal-certified food, even in tourist-heavy locations, underscores Malaysia’s commitment to catering to the halal tourism market.

2. Muslim-Friendly Infrastructure

Malaysia’s commitment to halal tourism goes beyond just food. The country’s infrastructure is designed to accommodate the spiritual needs of Muslim travelers seamlessly. Many hotels offer Muslim-friendly amenities such as prayer mats, Qibla direction indicators, halal-certified kitchens, and separate swimming facilities for men and women. Additionally, most shopping malls, tourist attractions, and airports have prayer rooms (suras), enabling Muslim tourists to perform their daily prayers without any inconvenience.

Even travel agencies and tour operators have developed packages specifically catering to the Muslim market, offering guided tours that include visits to Islamic heritage sites, halal dining experiences, and Muslim-friendly attractions. This approach ensures that Muslim travelers can enjoy a comprehensive vacation that meets both their leisure and religious needs.

3. Cultural Heritage

Malaysia’s rich Islamic heritage and cultural diversity are evident in its architecture, festivals, and everyday life. The influence of Islam in Malaysia dates back centuries, and it is reflected in the numerous mosques and Islamic landmarks throughout the country. Iconic sites such as the Sultan Salahuddin Abdul Aziz Mosque (Blue Mosque) in Shah Alam and the Putra Mosque in Putrajaya are popular not just for their architectural beauty but also as spiritual havens. These locations offer guided tours, allowing visitors to learn more about Islamic history and Malaysia’s unique cultural identity.

Festivals like Hari Raya Aidilfitri (Eid al-Fitr) and Maulidur Rasul (Prophet Muhammad’s Birthday) are celebrated nationwide, providing Muslim tourists a chance to participate in local traditions and experience the vibrant Islamic culture firsthand. Malaysia’s dedication to preserving its Islamic roots while embracing modernity makes it an attractive destination for those seeking both spiritual and cultural experiences.

4. Events Promoting Halal Tourism

Malaysia has taken a proactive approach to promoting halal tourism by organizing high-profile events such as the Malaysia International Halal Showcase (MIHAS) and the World Islamic Tourism Conference. These events attract global participants and industry players, fostering growth in the halal market while raising Malaysia’s profile as a leading destination for halal tourism. The events also showcase Malaysia’s innovative halal products and services, further boosting the country’s reputation as a pioneer in the global halal industry.

In addition to events, Malaysia’s tourism campaigns frequently feature halal tourism prominently. For instance, the “Malaysia Truly Asia” campaign has incorporated halal tourism elements, appealing to Muslim travelers worldwide. Collaborations with international Islamic organizations have also enhanced Malaysia’s global standing in the halal tourism sector.

Evolution of Halal Tourism in Malaysia

The halal tourism industry in Malaysia is continually evolving to accommodate the changing preferences of Muslim travelers. Let’s explore some trends and developments that have shaped the sector over the years:

1. Strong Government Support

The Malaysian government has played a vital role in promoting halal tourism as a national priority. The Ministry of Tourism, Arts, and Culture Malaysia (MOTAC) has implemented policies and campaigns specifically targeting the Muslim travel market. For example, the National Tourism Policy 2020-2030 includes strategies to increase the number of Muslim tourist arrivals by improving halal tourism services and promoting Malaysia as a Muslim-friendly destination. This support extends to financial incentives for businesses seeking halal certification, making it easier for the private sector to align with the country’s tourism objectives.

2. Expansion of Halal-Friendly Hotels

The number of halal-friendly accommodations has grown significantly in Malaysia. Many hotels have adopted halal practices, not only in food preparation but also in service offerings. The inclusion of private pool villas, separate gym facilities, and non-alcoholic mini-bars caters to the unique preferences of Muslim tourists. In popular tourist spots like Kuala Lumpur, Langkawi, and Penang, these features make Malaysia’s hotels stand out, providing a Muslim-friendly environment that meets the expectations of religious travelers.

Luxury resorts are also entering the market, targeting affluent Muslim travelers who seek high-end experiences without compromising their faith. Properties in destinations such as the Cameron Highlands and Kota Kinabalu have adopted halal practices, making them attractive options for Muslim tourists.

3. Muslim-Friendly Travel Packages

Travel agencies are increasingly offering specialized packages designed for Muslim travelers. These packages include visits to mosques, Islamic cultural centers, and halal culinary experiences. Family-oriented activities are often included, as Muslim travelers tend to travel in larger groups. With options like Islamic history tours, nature retreats with halal-certified amenities and Muslim-friendly cruises, Malaysia ensures that it caters to different types of Muslim tourists, from young adventurers to elderly pilgrims.

Top Muslim-Friendly Destinations in Malaysia

To experience the best of halal tourism in Malaysia, here are some destinations that provide a memorable and enriching journey for Muslim travelers:

1. Kuala Lumpur

Kuala Lumpur is at the heart of Malaysia’s halal tourism scene. The city offers a mix of Islamic heritage sites and modern attractions. Notable sites include the National Mosque, which stands as a symbol of Malaysia’s Islamic identity, and the Islamic Arts Museum Malaysia, where visitors can explore Islamic artifacts and calligraphy. The Bukit Bintang area is filled with halal eateries, shopping malls with prayer facilities, and hotels offering Muslim-friendly amenities.

2. Penang

Penang, known as the food capital of Malaysia, provides a halal culinary journey that is hard to match. The island has numerous halal-certified eateries, offering local delicacies like Char Kway Teow and Asam Laksa in halal versions. The historic George Town area is home to Islamic landmarks, including the Kapitan Keling Mosque, which serves as a testament to the deep-rooted Islamic heritage in Penang. Beyond food, Penang’s diverse culture and history make it an ideal destination for Muslim travelers who enjoy both sightseeing and culinary exploration.

3. Langkawi

Langkawi offers a tranquil escape with an array of halal-friendly resorts that provide luxurious accommodations for Muslim families. The island is ideal for those seeking relaxation, adventure, and halal dining, all in one place. Many resorts have private villas with halal-certified kitchens and separate pool facilities, while local attractions such as the Langkawi Sky Bridge and Eagle Square make for a complete holiday experience.

4. Malacca

Malacca’s Islamic heritage dates back to the era of the Malacca Sultanate, one of the most prominent Islamic empires in Southeast Asia. Today, the city boasts several historical mosques, including the Kampung Kling Mosque, which reflects a fusion of Islamic, Chinese, and Hindu architectural styles. Muslim travelers will also enjoy halal food options, ranging from traditional Malay dishes to Peranakan cuisine adapted for halal standards. The city’s unique blend of history, culture, and cuisine creates a distinctive appeal for Muslim tourists.

Economic Impact of Halal Tourism in Malaysia

The development of halal tourism in Malaysia has had significant economic implications, contributing to various sectors of the economy, including hospitality, retail, and manufacturing. Here’s how halal tourism has positively impacted Malaysia’s economy:

1. Increased Tourist Spending

According to the Global Muslim Travel Index (GMTI), Malaysia consistently ranks as one of the top destinations for Muslim travelers. In 2019, before the global pandemic, the country welcomed over 5 million Muslim tourists, contributing billions of dollars to the economy. Muslim tourists are known for their higher-than-average spending, especially on family-friendly activities, halal dining, and shopping, which has spurred growth in retail and tourism-related businesses.

2. Growth in Halal-Certified Products

Malaysia’s leadership in halal certification extends beyond its borders. The country is a leading exporter of halal-certified products, including food, cosmetics, and pharmaceuticals. The growing global demand for halal products has opened new business opportunities, further driving economic growth. By promoting halal products at events like MIHAS, Malaysia boosts its position as a leading halal hub, benefiting both the tourism and manufacturing sectors.

3. Skills Development

The expansion of halal tourism has created thousands of jobs in the tourism, hospitality, and food service sectors. Training programs focused on halal practices have enhanced the skillsets of the local workforce, ensuring that Malaysia maintains high standards in halal certification and service delivery. These opportunities have been particularly beneficial in rural areas, where halal tourism initiatives have led to the development of new businesses and community-based tourism projects.

Challenges in Halal Tourism

Despite the successes, some challenges need to be addressed to sustain the growth of halal tourism in Malaysia:

  1. Ensuring Consistent Halal Standards

The integrity of halal certification is vital. Malaysia must continue to maintain high standards across all aspects of the halal industry, including food, accommodations, and services. Regular audits and transparent halal practices can help uphold the country’s reputation.

  1. Competing with Others

Countries like Indonesia, Turkey, and the United Arab Emirates are also strong contenders in the halal tourism market. Malaysia must continually innovate by expanding its halal offerings, upgrading tourist facilities, and leveraging digital marketing strategies to maintain its competitive edge.

  1. Educating Non-Muslim Visitors

To create an inclusive environment, Malaysia should promote halal tourism as an aspect of cultural experience rather than just a religious requirement. Educating non-Muslim tourists about halal principles could encourage more diverse travel experiences and foster greater cultural understanding.

The Future of Halal Tourism in Malaysia

Looking ahead, Malaysia is well-positioned to further strengthen its halal tourism sector. Plans to expand halal offerings across lesser-known regions, invest in digital technology for Muslim-friendly travel solutions, and introduce new attractions tailored to Muslim tourists signal a bright future for halal tourism in Malaysia.

1. Expanding Halal Tourism

Malaysia has the potential to develop halal tourism in less popular areas like the East Coast, Sabah, and Sarawak. Promoting adventure tourism, eco-tourism, and cultural experiences in these regions can attract a broader range of Muslim travelers, diversifying Malaysia’s tourism landscape.

2. Technology to Enhance the Muslim Travel Experience

Mobile apps that provide information on halal-certified restaurants, prayer times, and nearby mosques are already in use, but there is room for more technological innovations. Virtual reality tours of Islamic heritage sites, AI-based travel planners, and digital platforms for booking halal-friendly travel packages can further elevate Malaysia’s appeal to tech-savvy Muslim tourists.

3. Initiatives to Attract Muslim Millennials

Muslim millennials represent a growing market in the halal tourism sector. Malaysia can tap into this demographic by offering attractions and experiences that cater to younger travelers, such as halal food festivals, Islamic art exhibitions, and outdoor adventure activities designed for families and young adults.

Malaysia’s emergence as a top destination for halal tourism is a testament to the country’s commitment to accommodating Muslim travelers. The comprehensive approach to offering halal food, Muslim-friendly amenities, and a wealth of cultural experiences has established Malaysia as a go-to destination for Muslim tourists. As Malaysia continues to innovate and expand its offerings, it is poised to maintain its status as a leader in halal tourism, catering to the needs of Muslim travelers while fostering a welcoming and inclusive environment for all visitors.


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HALAL ECONOMY

Malaysia Secures RM4 Billion Halal Industry Investment from China

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Malaysia is set to receive a significant boost in halal industry investments from China, amounting to RM4 billion. Deputy Prime Minister Datuk Seri Dr. Ahmad Zahid Hamidi announced a series of high-profile meetings with key Chinese halal industry players at the Malaysia-China Halal Business Forum in Shanghai. This development signals a strong economic partnership between the two nations, positioning Malaysia as a major player in the global halal market. Aamer Yaqub Reports

 

Halal Industry Investments from China

The potential RM4 billion in investments is aimed at various sectors within the halal industry, including food and beverages, pharmaceuticals, cosmetics, herbal medicine, and vaccines. These sectors are expected to drive economic growth and create new opportunities for Malaysia’s expanding halal industry. The importance of halal-certified products, especially in Muslim-majority regions like Southeast Asia and the Middle East, cannot be understated. As the global demand for halal products continues to rise, Malaysia is positioning itself as the primary hub for investors who want to tap into this burgeoning market.

“Forty Chinese companies have expressed serious interest in investing in Malaysia, with estimated investments totaling RM4 billion,” said Ahmad Zahid during a press conference. “The priority sectors are food and beverages, but there are also significant interests in pharmaceuticals, cosmetics, vaccines, and herbal medicinal products.”

This investment surge comes at a time when the halal industry is witnessing exponential growth. According to the State of the Global Islamic Economy Report 2023, the global halal market is projected to reach $2.3 trillion by 2024, with the food and beverage sector alone expected to account for nearly $1.5 trillion. Malaysia’s move to attract more foreign direct investments, particularly from China, is well-timed to capitalize on this growth.

Expanding Malaysia’s Halal Footprint

Malaysia’s halal industry continues to grow rapidly, thanks in part to its strategic location in Southeast Asia and its reputation for producing high-quality halal-certified products. Currently, Malaysia has dedicated 5,787 hectares of land to the halal industry, with the largest area being Tanjung Mas, Sarawak, which boasts an impressive 9,900 acres of land available for halal production. This infrastructure has made Malaysia an attractive destination for international investors looking to penetrate the global halal market.

In recent years, Malaysia has strengthened its halal certification system under the Halal Development Corporation (HDC) and the Department of Islamic Development Malaysia (JAKIM), making it one of the most recognized and trusted halal certification bodies worldwide. This has given foreign investors, including Chinese companies, confidence that their products will meet stringent global halal standards, making Malaysia an ideal base for halal production and exports.

Ahmad Zahid emphasized the need for government support to facilitate these new investments. He urged the state government to streamline the approval processes for Chinese investors, particularly in areas such as infrastructure development, including water and electricity supply, and providing incentives like tax exemptions. This move is expected to ease the entry of Chinese companies into Malaysia’s halal industry, enabling them to obtain the JAKIM halal certification, a globally recognized standard that will allow them to export their products internationally.

The halal certification market is not only limited to food but has expanded to include pharmaceuticals, cosmetics, and healthcare products. This diversification means that Chinese investors, who have already established themselves in various industries, can leverage Malaysia’s certification infrastructure to expand into new markets. As halal becomes a key driver of the global economy, Malaysia is positioning itself as the gatekeeper of halal standards for the world.

Halal Industry’s Global Potential

Malaysia is not only eyeing domestic growth but also aims to become a global halal hub, catering to the demands of the BRICS nations, ASEAN, and the Global South. During the Malaysia-China Halal Business Forum, Ahmad Zahid introduced a visionary concept: the Malaysia-China Halal Trade Corridor, an initiative designed to boost halal trade between the two nations and beyond.

This trade corridor is expected to streamline the import and export processes between China and Malaysia. It will feature Bi-Nation Halal One-Stop Centres, simplifying protocols, enhancing halal logistics, and providing easier access to markets in both countries. By aligning with China’s One Belt One Road initiative, this strategic corridor will strengthen the supply chain for halal products, not only in ASEAN but globally.

The Malaysia-China Halal Trade Corridor will also position Malaysia as the leading halal trade partner for BRICS nations, where the demand for halal products is growing. Countries like Brazil and Russia have shown increased interest in halal-certified meat and food products. Additionally, Malaysia is eyeing other key halal markets, including the Middle East and Africa, where demand for halal-certified products is steadily rising. By working closely with China, Malaysia can ensure a smoother supply chain for halal goods in these regions, further expanding its global reach.

Collaboration in Herbal Medicine and R&D

An exciting area of potential growth is the collaboration between Chinese investors and Malaysian universities and research institutions, particularly in the herbal medicine sector. Ahmad Zahid highlighted that Chinese investors have shown strong interest in partnering with Malaysian institutions like the Malaysian Agricultural Research and Development Institute (MARDI) to develop new products. This partnership could spur innovation in herbal medicine, enhancing Malaysia’s capabilities in this rapidly growing field.

Herbal medicine, already a booming industry in China, is seeing rising demand in Southeast Asia due to increasing consumer interest in natural remedies and wellness. Malaysia, with its biodiversity and rich tradition of herbal medicine, offers a fertile ground for research and development in this field. Collaborations between Chinese herbal companies and Malaysian research institutions will likely result in new product innovations, which will be halal-certified and available for export globally.

This initiative could also help Malaysia tap into the growing wellness industry, which was valued at over $4.5 trillion globally in 2022, according to the Global Wellness Institute. With the backing of Chinese investments and research collaborations, Malaysia could become a leader in halal wellness products, ranging from herbal supplements to cosmetics and pharmaceutical innovations.

Asian Development Bank Investment

In a separate meeting with the Asian Development Investment Bank from China, it was revealed that the bank is prepared to offer an initial funding of US$500 million (RM2.17 billion) for halal industry development. This funding will play a crucial role in kickstarting new projects and expanding existing halal facilities, further solidifying Malaysia’s position as a leader in the halal economy.

The Asian Development Investment Bank’s commitment underscores China’s long-term investment strategy in Malaysia’s halal sector. With US$500 million in initial funding, Malaysia can develop the necessary infrastructure, support R&D, and build new halal-certified production facilities that meet global demand. The bank’s backing also signals confidence in Malaysia’s role as a leader in halal finance, opening doors to further collaboration between the two nations.

Malaysia as a Strategic Halal Hub

Malaysia’s strategic location in Southeast Asia makes it an ideal hub for halal trade, both regionally and globally. Ahmad Zahid reaffirmed Malaysia’s commitment to becoming the leading halal hub for ASEAN and beyond. “Our goal is to establish Malaysia as a global halal hub, not just for ASEAN but for the world. The halal industry is growing rapidly, and Malaysia is well-positioned to lead this charge,” he said.

In addition to food, cosmetics, and pharmaceuticals, Malaysia is looking to diversify its halal offerings to meet the increasing global demand. With more companies looking to invest in halal-certified products, Malaysia is at the forefront of ensuring that halal standards are upheld across various industries. The halal certification, overseen by JAKIM, is recognized worldwide and provides companies with a competitive advantage in the global marketplace.

As the halal economy continues to grow, Malaysia’s ability to attract foreign investment, build infrastructure, and develop innovative products will be key factors in its success. By positioning itself as a global halal hub, Malaysia is set to reap the rewards of an industry that is poised to become one of the largest in the world.

The RM4 billion in investments from China marks a new chapter in Malaysia’s journey to becoming a global leader in the halal industry. With strong government support, robust infrastructure, and a strategic location, Malaysia is well on its way to becoming a key player in the global halal market. The Malaysia-China Halal Trade Corridor will further enhance this growth, ensuring that halal products from both nations can easily reach international markets.

These halal industry investments from China are just the beginning, and Malaysia is poised to seize the opportunities that lie ahead in the expanding global halal economy. By focusing on innovation, collaboration, and certification, Malaysia is positioning itself as the premier destination for halal investors and companies looking to tap into the global halal market.


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HALAL ECONOMY

Malaysia’s Halal Exports Expected to Surge to RM65 Billion by 2025

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Malaysia’s halal exports are projected to reach RM65 billion by 2025, up from RM54 billion in 2023, according to the Malaysia External Trade Development Corporation (Matrade). This growth is driven by increasing global demand for halal products and Malaysia’s leadership in the halal market.

Matrade deputy CEO (export acceleration) Abu Bakar Yusof attributes this confidence to the growing global demand for halal products and Malaysia’s strong position in the market. “The forecast for the halal products market is to reach US$5 trillion (RM23.3 trillion) by 2030. Last year, the halal economy was valued at US$3 trillion. There is a lot of room for Malaysia to capitalize on these opportunities. Malaysia has the advantage because our Jakim (Department of Islamic Development Malaysia) halal certification is highly recognized and much sought after by the international business community,” Abu Bakar told SunBiz in an exclusive interview.

Abu Bakar highlighted that Malaysia’s strength in the global halal market stems from its innovation, research, and development efforts, and collaboration with international partners. “Currently, our focus is on the high-value-added food and beverage (F&B) industry, catering not only to domestic consumers but also to the global market.”

High-value F&B products undergo significant transformation compared to traditional items, integrating advanced technologies, rigorous research, and quality control measures. “This transformation not only enhances product quality but also positions these goods at premium price points for the medium and high-end market,” Abu Bakar explained.

Malaysia’s success stories in halal exports include products such as durians and birds’ nests, with China emerging as a key consumer market. “Our durians and birds’ nests exemplify Malaysia’s capacity to leverage high-value products in international trade.”

Furthermore, the halal high-value F&B products align with sustainability and environmental, social, and governance (ESG) principles. “Companies that integrate sustainable practices throughout their supply chains, from sourcing raw materials to packaging and distribution, not only appeal to environmentally conscious consumers but also enhance their market competitiveness,” Abu Bakar added.

Currently, Malaysia has about 10,000 companies certified by Jakim for halal standards, primarily in the F&B sector. “The goal is to expand this certification base further where halal certification not only meets religious requirements but also aligns with global sustainability demands. This is where we encourage our local producers and manufacturers to invest in more research and development (R&D) and innovation, and automation to meet international requirements,” he said.

The growth in Malaysia’s halal exports is also driven by sectors such as pharmaceuticals and cosmetics, which are seeing increasing demand from countries in the Middle East, Europe, and Asia. “The global halal industry is experiencing robust growth driven by consumer awareness and demand for products that adhere to Islamic laws,” he said.

Abu Bakar emphasized that being halal does not only cover the slaughtering of animals but encompasses the entire supply chain. “We have both food and non-food products covered under halal standards. That’s why the total halal export figure is larger than just processed food. Processed food accounted for RM30 billion last year, while the total halal exports were RM54 billion, covering non-food items as well,” he explained.

Halal standards also ensure adherence to sustainability standards, hygiene practices, and rigorous facility inspections. “Even logistics play a role, with dedicated halal logistics providers ensuring that products maintain their integrity throughout transportation,” Abu Bakar concluded.

This robust growth projection underscores Malaysia’s strategic initiatives and a strong commitment to advancing its halal industry, positioning it as a global leader in the halal market.


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