Malaysia to extend reach in global halal supply chain
08 Sep 2021
The Halal Development Corp Bhd (HDC) is poised to reinforce Malaysia’s halal market by broadening the industry’s end-to-end presence in the global halal supply chain.
Chief executive officer Hairol Ariffein Sahari said Malaysian manufacturers could benefit from the local procurement of raw materials to produce finished products rather than sourcing the ingredients from other countries.
“However, the Covid-19 pandemic has disrupted the entire supply chain and affected the production lines due to restriction and factories closure. Thus, most manufacturers were unable to resume their production activities,” he said in a virtual interview today.
Hairol said most halal manufacturers in Malaysia imported all raw materials such as chocolate, sugar and flour.
“The main challenge halal companies face during the pandemic is a disruption in the supply chain, particularly with the procurement of raw material and ingredient input, although the demand for Halal product remains constant.
“With this problem, raw materials can’t reach the producers, while end products can’t get to the consumer quickly,” he said.
Hairol said the pandemic had halted the issuance of halal certificates and renewals as the necessary audits could not be undertaken due to the lockdown measures.
“As a result, Malaysia’s export in the halal segment fell 24.4 per cent in 2020 to RM31 billion from RM41 billion recorded in 2019,” he said, adding that the current number of active certified halal companies declined to 7,000 from 10,000 companies in 2019.
Hairol said Malaysia could achieve between RM32 billion and RM33 billion in halal exports by 2021 if the momentum of exports activities persist.
“We also target to attract RM300 million worth of new investments for the local halal market in the second of 2021, after raking in RM400 million of new investments in the first half this year. This is due to the easing disruption of the global supply chain and the resumption of manufacturing activities,” he said.
Hairol said the halal industry made up some 15 per cent of Malaysia’s gross domestic product during the pre-Covid-19.
Meanwhile, HDC will organise the 13th edition of the World Halal Business Conference 2021 (WHBC 2021), on September 9, with about 4,000 participants from 60 countries.
International Trade and Industry Ministry will host the WHBC 2021, which is set to discuss the role and contribution of the halal industry towards global economic recovery.