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Halal Market: a great opportunity for Spanish companies

Casa Asia hosted at its headquarters in Madrid the meeting "Spain Halal in Figures" and experts in the field explained the great potential that the Muslim environment has for companies from different sectors
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PHOTO/GUILLERMO LÓPEZ/ATALAYAR  -   Meeting "Spain Halal in Figures"

The Halal products market is a great opportunity for any company that wants to export to countries with large Muslim communities or even to offer its products to domestic consumers, not only in the food sector and more specifically in the meat sector, but also in other economic activities such as tourism, the pharmaceutical industry or the cosmetics industry.  

This is the main message launched at the meeting "Spain Halal in Figures", which served to shed light on the great options that are opening up in a market that has yet to be fully exploited at national and international level and which also requires a unification of standards at international level to define Halal accreditations.  

Enrique Fanjul, representative of the Exporters and Investors Club, Blanca Torrent, president of the Municipal Institute of Economic Development of Cordoba (IMDEEC) and deputy mayor of the Cordoba City Council, and Isabel Romero, representative of the Islamic Board and general director of the Halal Institute, who acted as moderator, were the main speakers at the main table.  

The Halal Institute is the body responsible for certifying in Spain, Portugal, Mexico and the rest of Latin America the goods and services suitable for consumption by Muslims, according to the precepts of Islam.  

With 15 years of experience and more than 450 clients, such as Repsol, Nestlé, Pascual, Alter or the Mandarin Hotel, the Institute is dedicated to promoting a standardised development of the Halal market in Europe and Latin America, through the articulation of initiatives, actions and projects that favour the integration of the Halal lifestyle, a global concept that means "permitted, authorised, healthy, ethical or non-abusive", and, therefore, that is beneficial for human beings, animals and the protection of the environment. 

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Emilio de Miguel, Enrique Fanjul, Blanca Torrent and Isabel Romero
What is Halal?

As the Institute itself explains, Halal defines all goods, practices and services suitable for Muslims. All foods are Halal, with the exception of those classified as Haram by Sharia or Islamic law, such as pork, animal found dead or not properly slaughtered, blood, ethanol or any other intoxicating substance. The Halal market covers not only the food sector, but also tourism, banking, logistics, finance, pharmaceuticals, fashion and cosmetics. Today the term Halal is synonymous with quality, health and sustainability.  

Halal Institute Certification

The Halal Institute's Halal certification brings several benefits, such as access to 57 emerging countries and 1. 800 million potential customers worldwide, 50 million of them in Europe, access to a market valued at more than 3 billion dollars, access to 4 million Muslim consumers (citizens and tourists) in Spain, overcoming barriers to entry in countries where certification is mandatory in order to introduce and market products and services, obtaining a reputable guarantee brand recognised worldwide by the Muslim population, having a certificate backed by the international accreditations of Muslim-majority countries, generating trust among consumers, facilitating their loyalty, differentiating itself from the competition by positioning itself as a "Muslim-Friendly" entity, accessing an alternative source of financing (Islamic banking) and becoming (in the eyes of Islamic investment funds) a "Shariah-Compliant" asset, adding value to the product and guaranteeing quality, healthiness and sustainability. 

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Blanca Torrent and Isabel Moreno
Market opportunity for companies and the Halal market in figures

The main elements of the meeting were the intervention of experts on the subject and the presentation of the report "Halal in Figures". 

The report shows the important dimension of the Halal markets as a destination for Spanish exports and, in particular, of the Asian markets as potential importers of these products, as well as in the sector's standardisation initiatives.  

The report is a useful tool to raise awareness among Spanish companies and institutions of the importance of this market. It is also a useful tool to encourage the implementation of public and private measures and initiatives to broaden the export base of Spanish Halal products and services. It has been prepared by the Halal Institute based on its own and external sources, such as the report on the state of the Islamic economy prepared by DinerStandard and the databases for Spanish exports to the countries of the Organisation for Islamic Cooperation of the Spanish Ministry of Industry, Trade and Tourism.  

Isabel Romero, Director General of the Institute, opened the event by highlighting the "consolidation of the Halal market" and the work of the Halal Institute over the last 25 years, offering a "professional certification option through a recognised brand".  

The representative of the Islamic Council also pointed out that "the number of companies is growing, as well as the diversification of sectors and new certification bodies to standardise competition, which always helps to improve offers and services". She also spoke of disadvantages with examples of organisations that are far removed from the desire to improve, which can deteriorate the image of the Halal concept.  

For his part, Enrique Fanjul, representative of the Exporters and Investors Club, pointed out that the promotion of markets for Halal products can provide "great opportunities for various companies". The Exporters' Club, as a private association of companies, some of which are very important, is equivalent to 20% of Spain's GDP, with foreign investment accounting for 50% of total Spanish foreign investment. 

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Enrique Fanjul

The foreign sector has been fundamental to economic activity in recent years, especially in the last stage of the economic crisis, maintaining and boosting national economic activity. Between January and July of this year, Spanish investment abroad exceeded 220,000 million euros, with growth of 24% compared to last year. Imports also grew by 40%, something positive because they are also beneficial for Spain and increase competitiveness, as Fanjul explained.  

Enrique Fanjul wanted to stress that these activities promote a greater presence of Spanish products in the Halal products market, which is insufficiently known in Spain and which can offer many opportunities for national companies. "We need to publicise this market more widely and provide information on the certification processes of the Halal Institute for a market that can offer important opportunities for Spanish exports," said Fanjul.  

In her speech, Blanca Torrent, President of the Municipal Institute for Economic Development of Cordoba (IMDEEC), Deputy Mayor of the Cordoba City Council and businesswoman, spoke of the closeness and affection that exists between the Spanish and Muslim cultures.  

She also highlighted the "importance of the Halal Institute, which represents companies from Cordoba that have a lot to contribute to the Muslim world". Blanca Torrent also specified the business excellence of companies certified with the Halal seal as an economic engine for the future.  

The president of the IMDEEC wanted to highlight that "in Cordoba there is a great asset of the Halal Institute because it generates confidence in the Muslim consumer", which is beneficial for everyone.  

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Blanca Torrent

Once the main table had finished, there was also time to welcome the presentations of experts such as Ramón Gascón Alonso, coordinator of the Asia-Pacific working group of the Exporters and Investors Club.  

With regard to trade and investment in Asia, the main focus was on China, a major driver of the regional and world economy. Although there are other interesting countries in the Association of Southeast Asian Nations (ASEAN), such as Malaysia. 

Ramón Gascón indicated that China's Gross Domestic Product (GDP) growth is developing with better figures than the EU and the world. He also stated that the Chinese giant has a lower growth rate now with the crisis, but suffers much less inflation than the rest of the planet. China is the EU's largest trading partner and Spain is the partner that offers the greatest potential for the Chinese market, as Ramón Gascón recalled, indicating that exports and investment flows between the two parties have increased, although the most important country receiving Chinese investment in Europe is Germany, the largest economy in the Eurozone. China tends to have a favourable balance of trade with its trading partners, and this is also a factor to be taken into account.  

The Asia Pacific representative of the Exporters' Club pointed out that "China is the world's largest exporter and the second largest importer" and that ASEAN has a growing relationship with China: 628 billion euros with a year-on-year growth of 7%.  

ASEAN seeks the economic and security integration of its countries and pursues the creation of a common South Pacific market. It has 700 million inhabitants, 8.5% of the world's population, and has the country with the largest number of Muslims, Indonesia. Islam accounts for 42% of the religions in the ASEAN area and China also has a Muslim population, which in general makes it a large market for Halal products and a great potential destination for investment from other countries, including Spain. On this point, it should be borne in mind that Europe is ASEAN's third largest trading partner after the United States and China, as Ramón Gascón recalled, who also pointed out that the Chinese government requires Halal certification for its meat because it is a major exporting country in the area and there are many Muslim destinations for its products. 

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Ramón Gascón

Ihsan Övüt, Secretary General of the Standards and Metrology Institute for Islamic Countries (SMIIC) of the Organisation of Islamic Cooperation (OIC), also spoke, highlighting the work of his organisation in publishing standards and offering help to countries without their own standards on the Halal concept. He also referred to a problem that currently exists, which is that of "convincing other countries to adapt and unify Halal standards" in order to facilitate the work of companies and certified entities so that they do not have to face different scenarios and different standards depending on the target country in order to export and introduce products in these markets.   

In this regard, he highlighted the harmonisation efforts made by SMIIC to be able to unify all the criteria regardless of the country or government in question and recalled that the Islamic Board cooperates with SMIIC as the only entity from a non-Muslim country that works directly with the ICO. 

The ICO is the world's second largest intergovernmental organisation after the UN, with 57 member states on four continents, represents Muslims worldwide and has diplomatic status. Meanwhile, SMIIC is an intergovernmental organisation with diplomatic status that does not grant Halal certification, but is a "standardisation technical development body" integrated into the ICO. In addition, it seeks to achieve uniformity and develops standards for trade between OIC countries, not only in Halal but also in other fields. SMIIC has 43 members and three observer countries, as Ihsan Övüt recalled: "The role of SMIIC is to create a standard Halal norm for all ICO countries in order to harmonise efforts," he explained.  

The model they are working on is based on three axes: the production sector, certification and accreditation. The idea is that there should be a higher body that guarantees harmony between standards, giving "more emphasis to the technical aspect". The standards are technical, although the International Shari'a Organisation is being consulted for its acceptance, as Ihsan Övüt clarified. 

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Ihsan Övüt

After the Turkish representative's speech, Isabel Romero introduced Tomás Guerrero, Director of the Halal Trade and Marketing Centre of the Government of Dubai in the United Arab Emirates, who presented the data of the report "Spain Halal in Figures", linked to the Halal Institute.  

Tomás Guerrero indicated that the Halal market in Spain has evolved a lot. A market made up of 1,800 million people and 57 Muslim countries. This means a "very powerful" commercial area, made up of different sectors, not only food and especially meat products, but also other productive segments such as cosmetics, pharmaceuticals and tourism. The Muslim community is growing steadily and is expected to exceed 2.2 billion citizens in the world by 2030. This is a very important market, "very attractive for Spanish companies".  

Guerrero stressed that this market is booming and full of opportunities for Halal or Muslim Friendly products. There are 57 Muslim countries, but others have large Muslim communities, such as China, India or even European countries that are home to a total of 50 million Muslims. These communities demand the consumption of this type of Halal products and services and this is where the focus should be placed. 

It is a key market for internationalisation; and in this area, the Halal Institute has certified more than 80% of the companies in Spain that focus on the Halal market. In 2006 there were 25 companies certified by the Halal Institute and in 2021 there were already 515 certified companies, an increase of 1,960%, as stated in the report presented by Tomás Guerrero.

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Emilio de Miguel, Enrique Fanjul, Blanca Torrent and Isabel Romero

The director of the Halal Trade and Marketing Centre of the Government of Dubai indicated that companies are certified to export to Muslim countries that require Halal certification to trade, but also with the domestic market in mind because there is an increasing number of Muslim consumers in Spain. The Muslim population in Spain has grown by more than 100% between 2006 and 2021.  

In addition to the food sector, this is also an opportunity for tourism as more than two million Muslims visited Spain in 2019, making it the first Muslim Friendly Emerging destination in 2022, as Tomás Guerrero pointed out. 

According to the INE, the average expenditure of Muslim tourists is 1,912 euros, while that of non-Muslims is 1,089 euros in the last year. This is a "fabulous opportunity" for Spanish companies, which leads them to become certified in order to export, but also to look at the domestic market, targeting a Muslim population that resides permanently and tourists who visit Spain temporarily every year.  

Regarding the size of Halal certified companies in Spain in 2021, the Halal Institute points out that 216 of the companies are small companies, 179 are medium-sized and 70 are large companies.  

As the report shows, in terms of the sectors in which Halal certified companies operate in Spain, 420 are in food, according to data from 2021, when there were 255 in 2016; 12 are currently in cosmetics, when there were 2 six years ago; there were no tourism companies registered in 2021 by the COVID, but in 2016 there were 12; and in logistics they have grown from none to 12 at present. 21 companies belong to other sectors. Meanwhile, 90% of the companies with Halal Institute certification are from the food sector, 147 companies from the meat sector and 52 companies from the oil sector. 

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Enrique Fanjul, Blanca Torrent and Isabel Romero

Certification by the Halal Institute facilitates exports for Spanish companies, which are currently exporting to 91 countries. These exports are mainly to neighbouring countries, with a ranking led by Maghreb countries such as Algeria and Morocco, followed by European countries with large Muslim populations. Outside the Mediterranean and the Maghreb, another major destination for Halal-certified companies in Spain are the countries of the Gulf Cooperation Council, such as the Emirates, Saudi Arabia, Qatar and Kuwait. Tomás Guerrero emphasised that the challenge now is to go beyond the Middle East, specifically to Southeast Asia, an "unknown market, but with great potential with a high growth rate and middle classes with increasing purchasing power". 

According to the report, of the 465 companies certified in Spain by the Halal Institute, 104 are in Catalonia and 92 in Andalusia; while 42 are in Castilla y León, 41 in the Community of Madrid and 30 in Murcia, already in the second tier. Between 2017 and 2021, the number of Halal-certified companies in Andalusia has increased by 43 companies.  

Finally, it was highlighted that Cordoba and its province are at the forefront in this field in Andalusia. In the province of Cordoba there are 16 certified companies that generate 2,685 jobs. The main destinations for Cordoba companies with Halal certification are Spain, Indonesia, Bangladesh, Thailand and the United Kingdom. Almost all the companies are in the food sector, but there are also companies in engineering and other sectors such as cosmetics, accessories, etc.