“Malaysia aims to standardize the halal economy through new ‘smart partnerships’ forged between Southeast Asia and the Middle East.”

The global “halal economy” is booming. As consumers across the Muslim world grow wealthier, their demand for goods and services aligned with Islamic principles is driving significant growth in sectors ranging from food and pharmaceuticals to banking and insurance. Globally, Muslim consumers spent an estimated $2.29 trillion on halal products and services in 2022, a figure Salaam Gateway forecasts to reach $3.1 trillion by 2027.

However, this rapid growth brings challenges, primarily the lack of a unified certification system, with multiple countries currently having their own bodies and logos. Malaysia is stepping up to lead the charge for standardization.

At the Fortune ASEAN-GCC Economic Forum in Kuala Lumpur on Wednesday, Malaysia’s Deputy Prime Minister Ahmad Zahid Hamidi, who chairs the Halal Industry Development Council of Malaysia, announced a significant breakthrough. The Association of Southeast Asian Nations (ASEAN) has agreed in principle to adopt a common halal logo across its 10 member countries. Furthermore, a discussion about a global halal certification is slated for Riyadh in November, underscoring the ambition to create a universally recognized standard.

“Halal is not only F&B, but pharmaceutical, banking, insurance. The way of life for Muslim is halal and we would like to share this knowledge,” Ahmad Zahid emphasized, highlighting the expansive nature of the halal economy. Malaysia, with its large Muslim-majority population and its largest bank, Maybank, being the region’s largest provider of Islamic finance, is well-positioned to champion this initiative. Other Southeast Asian nations like Indonesia, Thailand, the Philippines, and Singapore also boast significant Muslim populations, contributing to the region’s burgeoning halal market.

Beyond Halal: Forging “Smart Partnerships” in a New Global Landscape

Beyond its focus on the halal economy, Malaysia, currently holding the ASEAN chair, is also advocating for a broader “smart partnership” connecting the Gulf Cooperation Council (GCC), ASEAN, and China. Speaking on a panel about driving investments, Ahmad Zahid Hamidi, alongside Jing Guangjun, chairman of the Guangzhou Industrial Investment Holdings Group, articulated this vision.

He clarified that ASEAN is not “looking inward.” Under the leadership of Prime Minister Anwar Ibrahim, both Malaysia and ASEAN are committed to “move forward with smart partnerships” with the GCC (comprising six countries including Saudi Arabia, Qatar, and the United Arab Emirates) and China. Given the long-standing collaboration between ASEAN and China, Ahmad Zahid believes adding the GCC as a new partner would be mutually beneficial.

One promising area for this expanded collaboration is Artificial Intelligence. “Every nation, every region, should grab opportunities where new technology should be shared,” Ahmad Zahid stated, noting the GCC countries’ increasing outward investment and interest in sharing their technological advancements, particularly with ASEAN. The UAE, with its AI investment holding company G42, stands out as a leader in developing AI capabilities and technologies in the region, making it a key potential partner in this new trilateral alliance.