Potential Value of Indonesia’s Halal Industry Estimated at $202 Million

JAKARTA, KOMPAS.com - Indonesia, the most populous Muslim country, has enormous potential in developing its national halal industry, but homegrown businesses have yet to position themselves for the lion's share of this market.

BNI Syariah’s president director Abdullah Firman Wibowo said the global halal industry is estimated to be worth around 30,000 trillion rupiahs ($2 trillion), while the domestic halal market has the potential value of 3,000 trillion rupiahs ($202.5 million).

However, this sector remains dominated by foreign business players. “Indonesia is only the place for consumers,” said Abdullah in a webinar on September 29.

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Abdullah encouraged the local stakeholders to play a significant role in the national halal industry, especially in the Islamic finance sector.

“Currently, the halal industry is a new business and a new brand,” he said.

During the Covid-19 pandemic, he learned that the role of Islamic banking in the halal industry was quite good following the continued growth in its total assets.

In June alone, he said, the total assets of Islamic banking grew 9.22 percent annually to 545.4 trillion rupiahs ($36.8 billion). This figure was higher than for conventional banking, which only grew 4.89 percent.

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“It shows that the development of Islamic banking still posts a relatively better performance compared to conventional banking amid the Covid-19 pandemic,” he said.