By Baba Yunus Muhammad

The global halal economy, also known as the Islamic economy, valued at an impressive $7.2 trillion in 2020 and projected to surpass $10 trillion by 2025, is often lauded for its exponential growth. Yet, this dominant narrative, underscored at platforms like the just concluded World Halal Summit in Istanbul, Turkiye, largely frames the halal economy as a product- and consumer-centered market phenomenon. This perspective, while celebrating the diverse industries under the halal umbrella—such as food, fashion, tourism, and cosmetics—fails to recognize its potential as a comprehensive, ethical economic system, comparable to capitalism or socialism. To move the discourse forward, it is crucial to critique this predominant view and advocate for a broader, more integrated understanding of the halal economy.

 The Halal Economy: A Consumer-Centered Approach

Recent editions of the World Halal Summit, such as the 10th event in Istanbul, have focused on celebrating the market’s dynamism. Highlights from the summit include:

• Over 500 exhibitors showcasing halal-certified products.
• The introduction of specialized zones like the “Natural Organic Vegan Zone.”
• Nearly 1,000 B2B meetings fostering trade agreements.

These milestones reflect the industry’s adaptability and the growing demand for halal-certified products globally, from halal pharmaceuticals to modest fashion and vegan-certified goods. However, this framing largely positions the halal economy as a market-driven phenomenon, tethered to the needs and behaviors of consumers.

A Missed Opportunity: Viewing Halal as a System

The prevailing narrative diminishes the transformative potential of the halal economy by reducing it to a consumer-driven market. In reality, the halal economy offers a robust ethical framework that can redefine global economic practices:

1. Ethical Governance: At its core, the halal economy promotes justice, transparency, and inclusivity—principles that can address systemic inequities in traditional economic systems.
2. Sustainability: By emphasizing resource conservation and responsible production, halal principles align with global sustainability goals, offering a pathway to mitigate climate change.
3. Social Equity: Through mechanisms like zakat (charitable giving) and ethical labor practices, the halal economy ensures wealth redistribution and social cohesion.

These attributes align with the universal appeal of ethical economic models, making the halal economy a viable alternative to capitalism and socialism.

Bridging the Gap: Halal Beyond Muslim Consumers

The halal economy’s ethical values have universal resonance, evidenced by the increasing adoption of halal-certified products by non-Muslim consumers. For example:

• Halal food sales: These reached $2.5 trillion in 2023 and are expected to exceed $5.8 trillion by 2032, driven by demand for hygienic and ethically sourced products.
• Halal cosmetics: With products free from alcohol, animal-derived ingredients, and harmful chemicals, this sector is appealing to health-conscious consumers globally.

Despite these successes, focusing solely on halal-certified products for niche markets risks undermining its broader systemic impact. The halal economy must be positioned as a driver of global ethical reform, offering solutions to the challenges of inequality, unsustainable growth, and moral governance.

The Role of Türkiye: Leading or Following?

Türkiye’s emergence as a global hub for halal trade is commendable. Its leadership in hosting the World Halal Summit and its strategic investments in halal certification, private-label production, and international collaboration underscore its commitment. However, Türkiye’s approach, like the summit itself, leans heavily on promoting halal as a market rather than a system. For Türkiye to truly lead the halal economy, it must champion its systemic dimensions—integrating halal principles into governance, education, and international diplomacy.

The Case for a Systemic Shift

To unlock its full potential, the halal economy must transcend its consumer-centric narrative. Key steps include:

1. Policy Advocacy: Governments in Muslim-majority countries should legislate halal economic principles as frameworks for governance, taxation, and trade.
2. Institutional Integration: Establishing global halal institutions, akin to the International Monetary Fund (IMF), can provide governance structures rooted in Islamic ethics.
3. Global Advocacy: The halal economy must be marketed not just as a niche but as a universal solution to contemporary economic challenges, akin to how socialism was positioned as an alternative to capitalism.

The halal economy is at a crossroads. It can continue as a thriving consumer market or evolve into a transformative economic system that reshapes global trade, governance, and ethics. The choice lies with stakeholders—governments, businesses, and thought leaders—who must rethink their approach and embrace the halal economy’s potential as an alternative, ethical framework.

As the global community grapples with rising inequality, environmental degradation, and systemic corruption, the halal economy offers a compelling, value-driven solution. By shifting focus from products to principles, it can achieve unprecedented milestones, not just in market size but in global impact.

Malaysia has embarked on a visionary mission to strengthen global Islamic ties and expand economic partnerships by positioning Peru as an American Halal Gateway. This bold initiative, led by Prime Minister Datuk Seri Anwar Ibrahim, underscores Malaysia’s leadership in the global halal industry while unlocking significant economic opportunities for both nations. During Anwar’s visit to Lima, Peru, he met with key Islamic leaders and political figures, laying the foundation for this transformative collaboration.

Islamic Collaboration

In his meeting with Murad Hamida, President of the Islamic Association of Peru, Anwar outlined Malaysia’s commitment to fostering Islamic collaboration and supporting Peru’s growing Muslim community. While Muslims constitute a small portion of Peru’s population, their vibrant presence highlights the need for enhanced religious and cultural support. Malaysia’s initiatives aim to address this need while promoting economic inclusivity and Islamic unity.

Anwar emphasized three core areas of support: halal certification, Islamic education, and dawah initiatives. Halal certification involves streamlining processes to help Peruvian industries meet international standards, opening the doors to global markets. Islamic education initiatives aim to expand access to religious knowledge through tailored programs that respect Peru’s cultural context. Additionally, dawah efforts will strengthen Peru’s Muslim community’s spiritual and cultural identity, fostering unity and understanding in a multicultural society.

Malaysia’s leadership in halal certification is widely recognized, with its certification standards regarded as a global benchmark. The Department of Islamic Development Malaysia (JAKIM) ensures stringent compliance with Islamic dietary laws, making Malaysian halal certification synonymous with quality and trust. Over 80 countries recognize JAKIM’s certification, highlighting its global influence.

Malaysia’s efforts to assist Peru reflect its broader goal of sharing expertise to help other nations tap into the burgeoning global halal market. This market, encompassing halal food, pharmaceuticals, cosmetics, and logistics, is projected to reach USD 2.4 trillion by 2024. By extending its support to Peru, Malaysia is fostering economic ties and enhancing its reputation as a global leader in halal innovation.

The Potential of Latin America

Peru’s strategic location and abundant agricultural resources make it an ideal candidate for becoming a Latin American halal gateway. Situated at the crossroads of key markets in the Americas, Asia, and the Middle East, Peru has the potential to become a vital link in the global halal supply chain. Its diverse agricultural base offers various products suitable for halal certification, from fresh produce to processed foods.

By aligning with Malaysia’s halal standards, Peru can unlock access to over 1.8 billion Muslim consumers worldwide. The benefits for Peru are multifaceted. First, the halal industry presents an opportunity for market expansion, allowing Peru to diversify its export portfolio. Second, the development of halal-compliant industries can create jobs in sectors such as food processing, logistics, and tourism. Finally, Peru’s integration into the global halal ecosystem could position it as a leader in Latin America’s halal market, paving the way for sustained economic growth.

Anwar’s commitment to supporting Peru’s Muslim community extends beyond economic initiatives. During his visit, he presented 50 copies of the Holy Quran translated into Spanish, which underscores Malaysia’s dedication to fostering spiritual growth and religious education. This act of cultural diplomacy highlights Malaysia’s role as a global advocate for Islamic education and outreach.

Murad Hamida, the president of the Islamic Association of Peru, praised Malaysia’s efforts, emphasizing the importance of nurturing Islamic identity in regions where Muslims are a minority. This collaboration demonstrates Malaysia’s understanding of the unique challenges faced by Muslim communities in non-Muslim majority countries and its commitment to addressing these challenges through meaningful support.

Global Muslim Communities

Malaysia’s leadership in advocating for oppressed Muslim communities worldwide has earned it international respect. Anwar’s meeting with Murad Hamida reaffirmed Malaysia’s support for Palestinians and Lebanese Muslims, who face ongoing challenges due to geopolitical conflicts. This unwavering advocacy not only strengthens Malaysia’s role as a unifying force in the global Islamic community but also reinforces its commitment to justice and humanitarian values.

Transforming Peru into a Latin American halal gateway has significant economic implications. The halal industry is one of the fastest-growing sectors globally, driven by increasing demand for ethically sourced and certified products. By embracing halal certification, Peru can position itself as a leading exporter of halal-certified goods, attracting investments and creating new economic opportunities.

Peru stands to benefit in several key ways. The adoption of halal certification can boost exports of agricultural goods, processed foods, and beverages to Muslim-majority countries. Halal production facilities can attract foreign direct investments, particularly from Southeast Asia and the Middle East. Additionally, developing halal-friendly tourism infrastructure could cater to the growing number of Muslim travelers, further diversifying Peru’s economy.

Success Stories

Peru can draw valuable lessons from countries that have successfully integrated into the global halal market. Brazil, for example, is the largest exporter of halal-certified beef, demonstrating the potential for Latin American countries to thrive in this sector. Thailand has also made significant strides, leveraging its halal certification program to enhance its food exports and establish itself as a global halal leader.

These success stories highlight the economic rewards of investing in halal certification and infrastructure. By following similar strategies and leveraging Malaysia’s expertise, Peru can carve out its niche in the global halal industry.

While the opportunities are immense, building a halal ecosystem in Peru comes with its challenges. Awareness is a critical first step. Businesses and consumers need to be educated about halal standards and the benefits of certification. Infrastructure development is another key area, requiring investments in laboratories and facilities for halal compliance testing. Additionally, cultural sensitivity is crucial to ensure that halal practices align with local traditions and customs without alienating non-Muslim communities.

Maintaining halal integrity across the supply chain is another significant challenge. From production to distribution, every step must adhere to halal standards to ensure the authenticity of certified products. Addressing these challenges will require coordinated efforts from the Peruvian government, the private sector, and international partners like Malaysia.

Malaysia’s Role in Overcoming Barriers

Malaysia’s extensive experience in the halal industry positions it as an invaluable partner for Peru. Key areas of collaboration include technical expertise, capacity building, and trade facilitation. Malaysia can offer consultancy on halal standards and certification processes, conduct training programs for Peruvian officials and businesses, and assist in establishing trade partnerships to enhance market access.

By providing this support, Malaysia aims to equip Peru with the tools and knowledge needed to establish a successful halal industry. This collaboration not only benefits Peru but also strengthens Malaysia’s role as a global leader in halal innovation.

The halal industry encompasses a wide range of products and services beyond food. Halal-certified pharmaceuticals are gaining popularity as consumers seek ethically produced medicines and supplements. The cosmetics industry is also witnessing increased demand for halal-certified products, which are free from alcohol and animal-derived ingredients. In the fashion sector, modest clothing that adheres to Islamic principles is becoming a global trend, driven by rising consumer interest ethically and sustainably.

Halal-friendly tourism is another growing segment, with Muslim travelers seeking destinations that cater to their dietary and religious needs. By tapping into these sectors, Peru can position itself as a comprehensive halal hub in Latin America, offering a diverse range of products and services to global markets.

Related: Peru Aims To Boost Exports with Malaysian Halal Certification

Malaysia’s Goals at APEC

Anwar’s visit to Peru coincided with the 31st Asia-Pacific Economic Cooperation (APEC) Economic Leaders’ Meeting, providing a platform to discuss economic strategies, including halal market integration. During a joint press conference with Peruvian President Dina Ercilia Boluarte Zegarra, Anwar emphasized Malaysia’s commitment to positioning Peru as a gateway for halal products in Latin America.

This initiative aligns with APEC’s vision of fostering sustainable and inclusive economic growth. By leveraging the APEC platform, Malaysia and Peru can strengthen their collaboration and explore new avenues for economic partnership.

The principles of halal practices extend beyond religion, emphasizing ethical sourcing, animal welfare, and environmental sustainability. These values resonate with global efforts to promote responsible consumption and sustainable development. By adopting halal standards, Peru can contribute to a more ethical and sustainable global economy while enhancing its reputation as a socially responsible nation.

To achieve its vision of becoming a Latin American halal gateway, Peru must adopt a multi-pronged approach. Policy development is essential to establish government-backed frameworks for halal certification. Industry engagement is equally important, encouraging businesses to embrace halal practices and invest in compliance. International partnerships, particularly with countries like Malaysia, can provide valuable knowledge and technical support.

Consumer education is another critical component. Raising awareness about halal products and their benefits can help create demand in both local and international markets. By taking these steps, Peru can position itself as a leader in the global halal industry.

Malaysia’s bold vision to make Peru a Latin American halal gateway is a testament to the power of collaboration and shared values. This partnership has the potential to create economic prosperity, cultural exchange, and spiritual enrichment for both nations. As Peru embarks on this transformative journey, its collaboration with Malaysia symbolizes a new chapter in global halal trade. By embracing halal principles, Peru is not only unlocking economic opportunities but also contributing to a more inclusive and sustainable world economy.