Halal food + sharia finance = $2 trillion industry

October 28, 2011

With halal food supporters working together with the Occupy Wall Street protestors tomorrow in a rally against “Big Food,” the implications need to be promptly understood.  The local and “slow food” movements should realize that their efforts are being hijacked by big business elements and big sharia banks behind the halal food industry.

Tomorrow, the 3rd Annual American Muslim Consumer Conference is being held today at the Hyatt Regency in New Brunswick, New Jersey:

Conference attendees will probably still have time to drop by the rally against “corporate food” in the afternoon in Zucotti Park, New York.

Anti-"Big Food" rally

But buyer beware.  Major corporate interests are behind both the halal food industry and Islamic banking, and the two sectors are set to merge for an even bigger financial empire.  An overlooked but extremely important item was reported by the Global Islamic Finance blog earlier this month:

Halal and Islamic finance markets will converge, says Al Islami CEO

The $1 trillion (AED3.68 trillion) global Islamic finance industry is in the process of developing a road-map to converge on $651 billion (AED2.4 trillion) halal market, says Saleh Abdullah Lootah, Managing Director of Al Islami Foods.  He was speaking during the 8th Kuala Lumpur Islamic Finance Forum 2011 (KLIFF).

“Islamic stock exchange for both Islamic financial services and halal FMCG companies is a logical outcome and a natural relationship of the two fast growing industries. The time has come to sustain and channel this growth,” said Lootah.

“Growing Muslim population, awareness and consumers, their rising literacy and professional training, sustainable nature of Islamic economy, role of press and social media are the contributing factors for the impressive growth of Islamic finance and Halal food industry.”

From the international Halal food industry, Al Islami was the only halal food company from the Middle East invited to the international event.

Concurrent industry events were organised to cover the complete package of Islamic finance industry that included: Shariah Forum, The Takaful Rendezvous, Ethics and Finance Roundtable Exhibition, Workshops, Islamic Finance Essay Competition, and Islamic Finance Awards.

KLIFF 2011 gathered more than 1,500 delegates ranging from regulatory authorities, Shariah scholars, bankers, legal practitioners, Takaful operators, consultants, and academicians in Islamic finance around the globe.

The size of Islamic Finance Market in the GCC

According to a 2009 report titled the Development of Islamic Finance in the GCC, published by the Centre for Study of Global Governance of the London School of Economics:“the value of shariah-compliant assets is impressive in the GCC. The current size of global Islamic finance industry is at over $1 trillion (AED3.68 trillion), with GCC having $262.6 billion (AED964.5 billion).”

Islamic finance in the UAE, reports said, has been recording a steady and impressive growth in last few years with $73 billion (AED269 billion). Industry experts estimate the global industry size to rise to $2 trillion (AED7.3 trillion) in five years.

Malaysia, notwithstanding the efforts of the Gulf countries, claims the world’s largest Islamic capital market with assets rose 15 percent to $123 billion (AED452.6 billion) in 2011. The country has integrated the Islamic sector into its broader financial system, providing institutions as well as intermediaries a deep market in shariah-compliant equities, sukuk, exchange-traded funds, real estate investment trusts and derivatives.

(KippReport/9 Oct 2011)

Supporters will no doubt trot out false arguments about sharia banking being “ethical” even though sharia bank profits have been used to fund jihadist militants, “egalitarian” even though musharaka arrangements cost borrowers more money than conventional loans, or “safer” despite the example of Dubai’s economic meltdown.

One comment

  1. There’s been some debate over the true asset value of the sharia finance industry that’s worth noting as an addendum to this post:


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