Indonesia, known for its significant spending on halal products, faces a challenge as the number of local producers remains limited. The country's vast domestic halal market potential is largely tapped into by foreign manufacturers. To fully harness this potential and potentially target the global halal market of 1.8 billion Muslims, Indonesia needs to accelerate the development of its halal industry. The slow pace of development and superficial policies hinder progress in the halal sector. Despite having the potential to become a global player, Indonesia lags behind.
For example, in the modest fashion industry, Indonesian Muslim fashion products are highly regarded for their quality and creativity, with talented designers competing on a global scale. However, the largest exporter of Muslim fashion is currently China, a non-Muslim country that has recently entered the halal industry. Indonesia needs to act quickly to avoid being a bystander in the global halal industry, as other countries, including non-Muslim nations, aggressively build their halal ecosystems.
Erick Thohir, the Chairman of the National Islamic Economic and Finance Committee (KEH), called for MES (Masyarakat Ekonomi Syariah) to play a role in fostering a comprehensive ecosystem for Islamic economics and the halal industry. This includes supporting halal certification, developing human resources for the halal industry, providing Shariah financing for halal businesses, establishing halal industrial zones, promoting research centers for halal products, and conducting extensive halal education and public outreach.
It is crucial for Indonesia to seize the opportunity presented by the halal economy and ensure that small and medium-sized local players benefit from its vast market potential. The government must take swift and measured initiatives to empower Indonesian halal SMEs to prevent large foreign brands from dominating the market.
