Cool! Potential Halal Industry Increases Indonesia's GDP By 5.1 Billion Per Year

Illustration (Photo: Doc. Ministry of Finance)

Minister of Finance (Menkeu) Sri Mulyani revealed that as a country with the largest Muslim population, the Indonesian halal economy has enormous potential.

According to him, based on the halal market report in 2022, it is stated that the halal economy can increase Indonesia's GDP (gross domestic product) by 5.1 billion per year.

"We can achieve this through exports and investment opportunities. Indonesia is also the largest halal consumer market in the world with around 230 million Muslim population," he said when delivering a keynote speech at The 7th Annual Islamic Finance Conference (AIFC) online, Tuesday, August 29.

The Minister of Finance explained that Indonesia has succeeded in mobilizing its competitiveness in the halal market and its potential by becoming an important player in halal products globally. He said, Indonesia has a fairly good ranking globally.

Indonesia is in second place, especially for food and beverages. We also got third place globally in the fashion sector, and sixth place in the field of Islamic finance," he said.

The Minister of Finance added that Indonesia has great potential in the halal economy because it has a large Muslim population and capacity in various halal industries, such as halal food and drinks, halal pharmaceuticals, halal cosmetics, Islamic finance, and halal tourism.

He also revealed that there is the potential to become a major player in the global halal economy. The state treasurer said that halal economic development will help Indonesia increase economic growth and create jobs. "We show strong potential and this is a source of good and credible economic growth. This makes Indonesia an important role in the global halal economy," he said.

The Minister of Finance considers that the halal industry has grown positively amid serious and diverse global challenges. There are 1.9 billion Muslims worldwide who spent about 2 trillion US dollars on halal products in 2021. The spending grew higher by almost 9 percent from 2020 to 2021.

"By 2025, Muslim spending in the halal sector is expected to grow by 7.8 percent or reach around 3 trillion US dollars and the global halal economy itself is expected to reach 4.96 trillion US dollars by 2030. The global challenge has reaffirmed the value of the halal economy as a source of new growth," he said.

For information, the halal economy has the potential to continue to grow because currently the implementation of the framework and halal principles is not only limited by religious boundaries. It also includes relatively high health, hygiene and safety standards. The popularity of halal products and increasing demand are considered to come even from non-Muslim consumers. Small consumers look for products of high quality, good, safe, and especially ethical nature embedded in trade and halal values," concluded Minister of Finance Sri Mulyani.