Kuala Lumpur, Malaysia (1st April 2015) – Food and agriculture is the second largest OIC sector cluster after the energy cluster. Driven by a fast growing demographic, the urban middle classes, as well as competitive domestic companies expanding globally, Islamic markets are major global food and agriculture growth markets.
During a plenary session on Food and Agriculture Investment Opportunities in OIC Countries at the World Halal Summit (WHS) 2015 at the Kuala Lumpur Convention Centre today, panellists discussed ways in which various stakeholders could meet and take advantage of the large and diverse OIC market which ranges from the shores of the Atlantic right to the South China Sea.
Moulana Abdul Wahab Wookay at the WHS
Rafi-uddin Shikoh, CEO of advisory firm DinarStandard attributed three key drivers to opportunities in the food and agriculture sectors for OIC countries. They are the availability of native Islamic finance institutions, the prevalence of a Muslim lifestyle and finally trade between fellow OIC countries.
Zafar Khotamov, who is a Senior Management Strategy Specialist at the Islamic Development Bank (IDB) in Jeddah, Saudi Arabia; said that lack of financing opportunities for SMEs in OIC countries is a stumbling block to progress. This curtails opportunities for enterprising individuals to get into business and produce Halal products.
Institutions such as the IDB are figuring out ways to provide financing to enable SMEs to make full use of existing opportunities and produce quality products. The need to provide funding also has to be balanced out by responsibly nurturing these SMEs in order to be competitive and profitable.
Another key concern in terms of food security among OIC countries is the lack of irrigable land, due to the harsh landscapes of many OIC countries particularly in North Africa, Sub Saharan Africa and the Gulf states where infrastructure schemes that will improve irrigation and increase the availability of agriculture land will help increase food output and improve long term food security.
The discussions during this session pointed out that the vast majority of businesses utilising Syariah compliant banking facilities are conventional businesses, which leaves a huge room for growth for the Halal sector in Muslim countries. By embracing each other, the food producers will be able to procure funding in order to grow and produce, which in turn will reduce dependence on imported food and improve the local economy.
It was suggested in the forum that by increasing the availability of funding opportunities, Islamic Banks and food producers will be able to produce a synergy, where farmers and producers will be able to expand their businesses and increase their output and improve quality. Islamic financiers will be able to make big inroads into the vast untapped OIC market. This was highlighted as a win-win situation for both the food producers and the Islamic finance sector. At present OIC countries are net importers of food products. By implementing the right strategies and synergising Islamic financing with businesses in OIC countries, the result will be an engine of growth, which will spur businesses and reduce food dependence from non-Muslim countries.
Kuala Lumpur, Malaysia (1st April 2015) - The inaugural World Halal Summit (WHS 2015) opened today with unified sessions held to discuss two broad industry imperatives – the current state of the global Islamic economy and the role of accreditation in regulating the global Halal food market.
Providing a snapshot of the global Halal industry, speaker Mr. Rafi-uddin Shikoh, CEO of DinarStandard (USA), presented a conclusive snapshot of the current and potential value for each Halal industry’s sub-sectors worldwide.
Moulana Abdul Wahab Wookay with Shukri Abdullah, (CEO MIHAS)
The report, produced by DinarStandard and Thomson Reuters and supported by the Dubai Islamic Economy Development Centre (DIEDC), UAE gave key insights not just for the Halal food space, but also for fashion and lifestyle, travel, media and recreation, pharmaceutical as well as cosmetics.
Supporting his figures was Mr. Abdulla Mohammed Al Awar, CEO of DIEDC, the government agency entrusted to realise Dubai’s vision of becoming the global hub for Islamic economy. With about 40 projects in the pipeline, DIEDC is working with various government bodies and the private sector to implement various initiatives to achieve Dubai’s stated objectives.
As comparison, panellist Datuk Dr. Mohd Daud Bakar, Founder and Chairman of Amanie Group, highlighted issues within the Halal funding market in Malaysia, where there is currently no one single umbrella body that pushes for the convergence of Islamic finance and the Halal industry. He also highlighted notable gaps that must to be addressed by specialist Islamic scholars if the industry is to realise its full potential.
The second unified session saw the GCC Standards Organisation’s Secretary-General, His Excellency Mr. Nabil Molla, highlighting the need for a single accreditation body for the Halal industry, especially since Islam and the Qur’an is for everyone, not just for the Muslims.
He suggested signing memorandums of understanding (MOUs) between the various Halal accreditation bodies to mutually recognise each other with a single aim – to have one common market for all.
Concurring with him was Dr. Saleh B. Hussain Al Aayed, Secretary-General of the International Islamic Halal Authority (IIHA), Saudi Arabia who invited the Muslim countries worldwide to join the GCC Accreditation Centre (GAC) in their on-going efforts to harmonise the global Halal standards.
According to him, the most important variable within the Halal process is the slaughterman himself. He or she must be a Muslim, but production can be done by anybody. He also added that the communication on Halal and its importance should not be to everybody; enough to just the Muslims.
Re-emphasising on the call to unite under one banner, Mr. Salih Yuksel, SMIIC Accreditation Committee Chair & Acting Head, System Accreditation Department, Turkish Accreditation Agency (TURKAK), Turkey argues for the creation of a single accreditation that is mutually recognised by all countries. A better regulation would in turn open more doors for more investments leading to a natural expansion of the Halal sector.
In general, the two opening sessions of the inaugural WHS 2015 this morning provided delegates with a perfect overview of the Halal industry landscape as well as highlighting several defining elements of global commerce over the next decade.
The sessions also reviewed the importance of accreditation and explored some of the schemes that are being put in place to strengthen the integrity of the certification process and provide increased confidence in the Halal market worldwide.