Malaysia mulls integrating halal industry, Islamic trade finance

KUALA LUMPUR: The halal industry and Islamic or shariah trade finance need to be integrated in order to increase the Islamic global trade activity.

Maybank Islamic independent non-executive director Datuk Dr Afifi Al-Akiti said government regulators need to play their role and study the matter thoroughly, including conducting engagement with relevant stakeholders as there is an urgent need to come up with the right policy to support the integration.

“Given that there was only a 1.5 per cent contribution of Islamic trade globally in 2016, the potential is clear that there is a huge opportunity in the halal industry and Islamic trade finance,” he told reporters on the sidelines of the 11th World Halal Conference (WHC) 2019 here today.

On the adoption of the fourth industrial revolution (IR 4.0), Afifi said the usage of blockchain technology in the halal certification, for example, could help the industry expand faster, given its efficiency in expediting the halal certification process up to 3,000 per cent.

“The technology not only speeds things up, but also ensures that the certificate cannot be forged or fabricated,” said Afifi who is also a permanent member of the Halal Malaysia Council.

Meanwhile, Economic Affairs Ministry's Service Industry Section director Dr Khalid Abdul Hamid said although Malaysia has yet to fully utilise automation technology, it has started to explore the potential such as artificial intelligence (AI), virtual reality (VR) and Internet of Things (IoT) in various industries, mainly on ways to manage cost more efficiently.

“To inculcate IR4.0, we need the people to embrace the culture of technology, which will then lead to increasing productivity, competitiveness and cost reduction,” he said.

Khalid the halal industry's contribution to the country's gross domestic product (GDP) is expected to increase to 8.7 per cent in 2020 from 7.5 per cent in 2017.

According to the State of the Global Islamic Economy Report 2018/19, Muslims spent US$2.1 trillion across food, beverage and lifestyle sectors in 2017 and the community spending is forecast to reach US$3 trillion by 2023. - Bernama