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PP 13884/ 10/ 2006 | MICA (P) 135/ 12/ 2005

| kasehdia.com | www.halaljournal.com | JULY+AUG 2006

World Halal Forum

2006 Report

Catch a glimpse of True Power of the Halal Market inside

Profit from Tesco’s RM1 Billion Investment in Halal I’M LOVING IT: Enter Halal Savvy McDonald’s JAKIM Going High Tech HALAL IN INDONESIA: Which is the Logo? Plus a New Section Covering Halal Developments in All the Continents That Matter: Americas, Asia, Africa, Europe and Australasia - In Every Issue!

+

LIVING: ISLAMIC CALLIGRAPHY IN CHINA TRIO JOUBRAN’S CD ISLAMIC BUSINESS ETHICS GOING TURKISH WITH ANATOLIA A LOOK AT BRUNEI DARUSSALAM

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The World Halal Forum

2007 updates & pre-registration on www.worldhalalforum.org


The Premier Global Halal Industry Event

TM


www.halaljournal.com | ISSN 1823 1411 • PP 13884/ 10/ 2006 • MICA (P) 135/ 12/ 2005

J U LY + AU G U S T 20 0 6

contents 20} TESCO RM1 BILLION PLAN

The means are there, but are you ready?

30} MIHAS 2006

In the true spirit of Halal

32} MODERNISATION

JAKIM’s new high tech, open door policy

34} MCHALAL?

Enter the fastfood giants to teach us a thing or two on Halal

38} HALAL MARKET MOVEMENT

Can something grow in four directions?

40} ASIA : INDONESIA

Does the biggest Halal market in the planet need a common Halal logo?

44} ASIA : THE PHILIPPINES

Government pledges support for Halal

45} AUSTRALASIA : AUSTRALIA

Potential for Islamic Finance and Education

47} AFRICA : NAMIBIA

Namibian – South African Halal Trade Scenario

23}

COVER STORY: THE WORLD HALAL FORUM 2006

As the dust settles, we look back at what happened to see the future

48} EUROPE : FRANCE

The Mecca Cola Business Model to Fight Injustices

53} ISLAMIC BONDS

A Review of Current Practices

©2006 KasehDia Sdn. Bhd. All Rights Reserved

DISCLAIMER : While all care is taken, the publisher accepts no responsibility for the information contained herein which is believed to be reliable. The publisher/editor takes no responsibility for opinions expressed or implied as they are the writers’ own and do not necessarily reflect that of the publisher or editor who make no warranties governing material, including advertising or features contained within this publication. This publication may not in whole or part, be copied, reproduced or translated without prior written permission of the publisher.

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Ed’s Note

T

he international Halal industry buzz reached its climax last May when thousands from around the world congregated in Kuala Lumpur for the double

event- the inaugural World Halal Forum and the 3rd Malaysia International Halal Showcase. It was a staggering combination of big business, religion and politics participated by both Muslims and non-Muslims! No wonder the Halal events attracted the attention of mainstream media like the BBC, Yahoo! AP and AFP.

“There’s a lot of organic baby foods out there but none of them have Halal certification,” Sakeena Rashid, a young resident of Dublin, Ohio

We have devoted our Cover Story for the WHF to give you a glimpse of what transpired during the three-day event. At the WHF, Malaysian Prime Minister Dato’ Seri Abdullah Hj. Ahmad Badawi also announced the formation of the

Regulars 08} QUIETLY SPOKEN What is “Exporting Culture”?

08} GLOBAL NEWS

Halal Industry Development Corporation, a milestone in the development of the global Halal industry, which is now set to become a focal point for the Halal industry to ensure its growth. The Halal Journal will pay close attention to the developments coming from Malaysia. Based on feedbacks we received from our readers

Your quick reference of Halal developments around the globe + updated Calendar of Events

recently, we have also introduced a new feature in The

14} BETWEEN THE LINES

developments happening in all target continents, namely

Reflections and Resolutions

16} MATRADE NEWS

Choice companies and products from Malaysia for the world

Living

Halal Journal. Starting this issue, we will be giving you Halal the Americas, Asia, Africa, Europe and Australasia. We trust you’ll find this new feature useful. No matter where you are.

the Halal Journal team

60} ISLAMIC CALLIGRAPHY IN CHINA Deep roots, visually appealing, a heightened state of iman

63}BROWSING

We checked out Trio Jubran’s latest album, Islamic Business Ethics and Anatolia Turkish Restaurant in Singapore

66} ON DISPLAY

Halal and good stuff currently on the shelf

64} COUNTRY IN FOCUS: Brunei is in need of changes and diversification

68} PARTING WORDS

Can businesses infuse Islamic teaching into its structure? Meet the maverick Tan Sri Muhammad Ali Hashim

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:: the Heart of The Halal Journal :: Halal refers to that which the Creator has made lawful. Its opposite, Haram, refers to what is forbidden. These parameters has been designed for health, safety and benefit of all mankind regardless of age, faith or culture. The realm of the Halal extends beyond the obvious references to food and touches all matters that relate to human life. In the commercial arena, all goods and services, markets, transactions, currencies and other activities come under the judgments of Halal and Haram. These parameters include protecting the environment, humane treatment fo animals, ethical investment, the intrinsic value of currencies and fairness in all commercial transactions. We believe that the emerging global Halal market will be one of the great market forces in the coming decades.

7/6/06 5:34:56 AM


KASEHDIA HALAL GUIDES “The world’s first series of Halal food restaurant guides.”

The Team EDITOR

Jumaatun Azmi

Asian Wall Street Journal

WRITER

Kamarul Aznam Kamaruzaman Sharifah Shazana Syed Salim Agha CONTRIBUTING WRITER

Salama Evans Juana Jaafar Tong Yee Siong Shahreen Nayan Mujib Miah Ryana Muhammad

Top 3 ‘Best Guide in the World’ for 2004 Gourmand Awards

DIRECTOR, RESEARCH & INTELLIGENCE

Abdalhamid Evans CREATIVE DIRECTOR

Nori Abdullah GRAPHIC & DESIGN

M. Zailan DIRECTOR, SALES & DISTRIBUTION

Nordin Abdullah

Corporate MANAGING DIRECTOR EXECUTIVE DIRECTOR CREATIVE DIRECTOR DIRECTORS

Jumaatun Azmi Nordin Abdullah Nori Abdullah Abdalhamid Evans Fareen Shazli Ali

KasehDia KASEHDIA SDN BHD 31-2 Plaza Crystalville Jalan 22A/70A, Desa Sri Hartamas 50480 Kuala Lumpur, MALAYSIA tel: +6 03 6203 1025 fax: +6 03 6203 4072 email: info@halaljournal.com www.halaljournal.com

Partner Events

Printed by Artworks Printing Sdn. Bhd.

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Available in all major bookstores www.kasehdia.com • info@kasehdia.com

7/5/06 12:30:04 PM


8

Exporting Culture Why is the export of culture

important and why should Halal Food exporters be interested? Who are the biggest exporters of culture in the world? Some would say Europe, but that would refer to the “higher” level. America has exported its culture successfully for some time now. They have been so successful at exporting culture that the impoverished ghetto culture of some of the African Americans is exported in the form music and language, and the merchandise that followed that culture in the form of clothing, movies, music etc. This is not a high culture or something that is pretty; in fact it is accentuated by violence and poverty. Yet they have packaged it and sold it to the world. Talk about cultural osmosis. The food industry is currently fraught with issues, and ideas like free trade and organic have filled a void for the consumer groups that identify themselves with the basic principles of those movements. Halal is doing the same. Halal is an opportunity to export some culture to the world. Halal in fact has this potential, exporting of the concept to those that are not that aware of the benefits of Halal will in fact lead to the export of more Halal food products and services. The export of these ideas is just as powerful when looking at the emerging economies looking to penetrate the global Halal market. Export culture and the hj products will follow.

“If the U.S. continues to promote U.S. beef in the Middle East and continues to turn a blind eye to the method of the blessing and (continues) doing it incorrectly, the Middle East could stop buying,” Sam Rayes, Tex-Med Beef Co.

Mark Piet

Quietly Spoken

GlobalNEWS

UNITED STATES

US COULD LOSE MULSIM BEEF MARKETS OVER SLAUGHTER PROCEDURES

U.S. beef markets in some Muslim countries could be in jeopardy if those countries ever decide to get serious about Halal, because many U.S. plants don’t measure up, some Halal certifiers contend. “If the U.S. continues to promote U.S. beef in the Middle East and continues to turn a blind eye to the method of the blessing and (continues) doing it incorrectly, the Middle East could stop buying,” said Sam Rayes, co-founder of Tex-Med Beef Co., a Houston firm offering Halalcertified meats in mainstream supermarkets. According to Rayes’ estimates, more than 50% of U.S. beef exports to Islamic countries are affected by inadequate procedures. The questions about the procedures come at a time when the U.S. meat market is trying actively to build more market share in the region. Mazhar Hussaini, director of the Halal Certification Program for the Islamic Society of North America, said, “the problem is there is a range of standards (among Islamic countries) and different interpretations of the standards (by Halal certifiers).” But importing countries are beginning to scrutinize the process more closely because it’s important to them. Hussaini said this “is not really the U.S. Department of Agriculture’s fault”. It’s a matter of truth in labelling. It’s also why his group is working on a standardization process that will make the process at each plant more transparent and allow a more informed buying choice. | SOURCE: CATTLENETWORK.COM, 14/6/06

MALAYSIA

ARON TO BRING IN HALAL MEAT FROM CHINA

PRIVATELY-HELD Aron Sdn Bhd plans to introduce China-imported halal meat to local supermarkets and hypermarkets by July this year, which will be sold under the Aron brand. Chief operating officer Afizul Aezhar Sharifuddin said premium meat from China is between 15 per cent and 20 per cent cheaper than meat from New Zealand and Australia. Currently, there are less than five suppliers who import halal-meat from China for local consumption. About 90 per cent of meat that Malaysia imports to support the local demand comes from India. “We want to provide alternatives for consumers. Furthermore, the beef standard is as good as the ones imported from these countries,” he told Business Times in Kuala Lumpur recently. Its cattle and sheep are fed on high quality diet like wheat, stalk and grains, without the use of animal origin products, which is an outstanding issue in halal-based meat. Its cattle, goats and sheep are also manually slaughtered. Through its subsidiaries, Dynamic Sphere Resources Sdn Bhd and Esprit Holdings Sdn Bhd, Aron has secured permits to import 48,000 tonnes of beef and mutton respectively this year. The Bumiputra-owned company will import about 160 containers of both beef and mutton per month or about a total of 25 tonnes respectively. Aron is projecting about RM16 million revenue a month. “In future, we are looking at producing a whole range of halal-based goods from China like gelatin and other products,” Afizul said. The company does not rule out the possibilities of breeding and processing its own cattle and meat in China in two years. “The demand for halal meat is getting bigger worldwide and China offers land and cheap labour to carry out integrated farming activities in the country,” he said, adding that Aron has received enquiries from South-East Asia and West Asian countries to supply halal meat produce. | SOURCE, BUSINESS TIMES, 26/6/06

THE HALAL JOURNAL

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PHILLIPPINES

AGENCY IN PHILLIPPINES UNROLLS PROGRAM TO TAP HALAL MARKET

The Department of Trade and Industry (DTI) is finally gunning at the $150 billion a year food market in the Muslim world. The DTI was named last year to be the lead agency in promoting Halal food manufacturing and export in the Philippines. This year, the Bureau of Export Trade Promotions (BETP) unrolled a development program that seeks to penetrate the rich market for Halal products. In outlining the program, BETP said it is ironic that in spite of having a fairly large Muslim population, the Philippines have been lagging far behind Thailand in the production and promotion of Halal food products. Thailand has become a world leader in that niche despite its small Muslim population. For the year 2006 to 2007, DTI is set to act on supply development, meeting international standards, advocacy, accessing markets, trade facilitation and promotion. There are six agencies of the government tackling the different aspects of Halal product development and promotion. Their mission: to work as a team and not on cross purposes. In a meeting called by DTI in mid-February, the different agencies were urged to get their act together in pursuing the Halal export program. The key step taken by DTI is the creation of an accreditation bureau which will see the development of a one-stop shop for exporters. Still to be hurdled is the need for the Bureau of Food and Drugs and the Department of Science and Technology to build their capabilities at par with the technical capabilities of other exporting countries in meeting international Halal standards. | SOURCE: SUN.STAR, 18/5/06

“Franchising can take Halal products globally because wherever the establishments are, the Halal factor of the products or services, will be maintained as franchisees have to follow conditions set in the franchise agreement. In addition, franchising also helps minimise a lot of risks as the risk is shared with franchisees.” Affandy Abdul Raof Faiz, Francorp Malaysia Sdn Bhd.

MALAYSIA

FRANCHISING CAN HELP MALAYSIA BECOME A HALAL HUB

FRANCHISING can help Malaysia become a regional Halal hub as businesses will be able to grow faster with minimal risk, Francorp Malaysia Sdn Bhd president and chief executive officer Affandy Abdul Raof Faiz said. Affandy said franchising can take Halal products globally because wherever the establishments are, the Halal factor of the products or services, will be maintained as franchisees have to follow conditions set in the franchise agreement. In addition, franchising also helps minimise a lot of risks as the risk is shared with franchisees. “All Halal establishments should look at franchising to expand their business locally or overseas,” he said. Franchising opportunities in Malaysia are aplenty. Currently franchises contribute only five per cent of the total retail sales in the country compared to 41 percent in the US. Committed to developing the franchise market in the country, Francorp Malaysia is the master franchisee for franchise consultancy group, Francorp USA. Established in April 2004, Francorp Malaysia holds the franchise for Malaysia, Singapore, Thailand and Indonesia. | SOURCE: BUSINESS TIMES, 30/5/2006

MIDDLE EAST

HALAL LOGISTICS HITS THE MIDDLE EAST

The Halal food industry is demanding better supply chain efficiencies to cut costs without compromising on the Halal status of products. The ‘Halal logistics’ concept is gaining prominence in several Muslim countries and looks set to become a lucrative niche market for 3PL companies in the Middle East. Concerns on the malpractice of meat exports into the Middle East have created genuine concern over the legitimacy of Halal products being imported from non-Islamic countries. The situation has highlighted the importance of supply chain solutions aimed at the Halal food industry. Food manufacturer Al Islami Foods has pioneered the concept of Halal logistics for several years. Since its inception, the Dubai-based company has obtained special permits allowing the employment of Muslim slaughterers and senior supervisors abroad to ensure meat was being produced according to Islamic teachings. The company also implemented strict guidelines to ensure its products remained completely Halal during the distribution process. “Products manufactured by Al Islami Foods must be completely Halal in all respects,” said Hasan Rimawi, the chief technical officer of Al Islami Foods. “The main factor jeopardising the Halal status of food products during distribution is the mixing of Halal and non-Halal products in the same container.” Al Islami Foods handles distribution inhouse and packs meat into sealed containers to avoid contamination. “Many logistics companies will deal with both Halal and non-Halal products. We avoid risks of mixing both types of meat by placing our products in sealed containers and distributing them in the company’s own fleet of vehicles,” added Rimawi. Whilst companies such as Al Islami Foods control their own supply chains, the concept of Halal logistics could prove a lucrative niche market for third party logistics companies throughout the world. The international Halal food industry is worth a staggering US $570 billion during 2005 with the total expenditure on logistics operations accounting for roughly 5-10%. | SOURCE: ITPBUSINESS.NET, 29/5/06 THE HALAL JOURNAL

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GlobalNEWS “As Islamic finance spreads in retail and wholesale markets, it is becoming more and more important that we create a regulatory framework for this.We need the same level of protection and confidence (in Islamically compliant products) as any other product regulated by the FSA.” Sir Callum McCarthy.

UNITED KINGDOM

REGULATOR TO KEEP PACE WITH GROWTH IN ISLAMIC FINANCE INDUSTRY IN UK

LE T TERS

Regulatory scrutiny of the Muslim financial industry in the UK is to be stepped up as it expands, the chairman of the Financial Services Authority said yesterday. In particular, the city regulator will soon unveil a framework to bring Islamically compliant “home purchase” plans within its sphere of regulation. The status of so-called Islamic bonds, or sukuk, is also expected to be addressed. Sir Callum McCarthy told a conference on Islamic finance and trade: “As Islamic finance spreads in retail and wholesale markets, it is becoming more and more important that we create a regulatory framework for this. “We need the same level of protection and confidence (in Islamically compliant products) as any other product regulated by the FSA.” The comment comes amid rapid growth in the Islamic finance industry, which is estimated to total $200bn- $400bn globally and creates products that do not involve interest. It is now attracting growing interest from western investment banks and the government. The conference, organised by the Muslim Council of Britain, has been seen by both the government and the City of London as a chance to promote London’s role in this market, which some officials hope could forge a new, unusually apolitical bridge between the UK and the Muslim world. | SOURCE: FINANCIAL TIMES, LONDON, 14/6/2006

LETTER 1: FOLLOW UP Assalamu Alaikum, First, I wish to commend the KasehDia management and staff for the first excellent World Halal Forum. From the attendance and the participation, it was an exceptionally successful program, again being a first. During the past 20 years, we have attended many conferences and programs and I can honestly say this was one of the most professional, well planned and well attended conferences. Next, personally and on behalf of all at Midamar, we wish to thank you for the acknowledgement and recognition for the years of Midamar’s contribution to not only the North American Halal market as a pioneer and premier producer, but also for our global Halal presence. We were deeply honoured and pleased with the recognition bestowed upon Midamar. As a follow up, we are committed to supporting and cooperating on the structure of the proposed Association of Halal Producers and Manufacturers. We have just returned to Iowa and I wanted to send this quick message of deep appreciation and also to commend and congratulate you on the successful back to back programs of World Halal Forum and MIHAS. With Salaams, best regards and respectfully yours, Bill Aossey Midamar Corporation Cedar Rapids, Iowa

BAHRAIN

ISLAMIC BANKS SHOULD MERGE

Islamic banks should merge to form a large financial institution capable of competing with the world’s largest banks or face being insignificant at a global level, the former Prime Minister of Egypt told a conference in Bahrain yesterday. Abdul Aziz Hijazi, who was also one of the pioneers of the concept of Shari’ahcompliant finance, outlined the changes he believes the sector needs to implement to increase its global presence, in the keynote speech on the opening day of the 8th Annual Conference on Islamic Banking and Finance. In a passionate address to hundreds of delegates, Hijazi said: “I urge these national Islamic banks to merge, because in the global market smaller banks have no status. They should integrate so that an Islamic bank will be one of the top 100 banks in the world.” | SOURCE: BAHRAIN TRIBUNE, 12/6/06

LETTER 2: HALAL UNION & YOUTH DEVELOPMENT Since the establishment of the First Halal Trade Union in the world we have been working towards improving employment and economic development. Our Union Manager Br. Burhan has been working with the youth and early school leavers for many years and has been a great source of ideas and employment development opportunities. He has been working towards encouraging the youth from within our community to join the Halal Meat Industry. A new website service has been launched for the Youth and Early School Leavers (www.halalunion.co.nz) who wish or consider a career in the Halal Industry. The Union will first assist the youth with their needs to acquire the skills, then after a two years employment the Union will work towards upgrade the youth skills to further their education to become a MAF meat Inspector. We look forward to your support. Please circulate the message so that more youth and early school leavers would benefit from this new service. Regards NZ Halal Union LETTER 3: CONGRATULATIONS! With pleasure I recall my interaction with you at the World Halal Forum 2006 and MIHAS 2006. The organisation of the inaugural World Halal Forum 2006 was indeed the best managed event I have attended in the recent past. I appreciate the hard work it entailed in the planning and execution of this major world class event. The excellent outcome was clear for all to see and I do wish and pray that this will lead to the proper understanding and growth of the Halal sector in the years to come. Please accept my congratulations and thanks once again. I look forward to continue our interaction. Kind regards, Rashid Kadimi Allanasons, India

10 THE HALAL JOURNAL

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GlobalNEWS Calendar of events

AUSTRALIA

LIVE CATTLE EXPORTS SPARK ROW IN AUSTRALIA

THE first shipload of live cattle to leave Townsville in more than three years has angered animal welfare advocates who say the practice is inhumane and doesn’t make economic sense. But industry experts disagree and say people who believe banning the practice would improve animal welfare are naive. RSPCA Queensland spokesman Michael Beattie said the live export of cattle was an inhumane practice and one of the biggest issues concerning animal welfare groups. He said the length of the journey was stressful on the animals and Australia was not able to control how the animals would be slaughtered once they arrived overseas. “There are horror stories, particularly just about how the animals are treated on the journey, and we do accept there have been some improvements there, but the most worrying thing is how the animals are slaughtered when they reach their destination,” he said. He also added that live exports did not make economic sense as jobs were transferred overseas. “We can slaughter them here under humane conditions,” he said. Chief executive officer of The Australian Livestock Export Corporation (Livecorp) Cameron Hall said there were two market segments for both live and frozen meat exports. He said Australia exported both frozen and chilled meat products to many countries throughout the world including those which imported live animals. Mr Hall said stopping the trade wouldn’t mean improvements in global animal welfare, it would just mean Australia would be substituted as a supplier. “Let’s not be naive about this,” Mr Hall said. “People who think those countries that import live animals are going to revert to frozen carcasses are simply wrong. They will continue to import livestock from countries that simply do not have the breadth or the rigorous standards that Australia has for the preparation and shipment of livestock.” Mr Hall said. Mr Hall said the industry was actively investing in the markets that received Australian animals to significantly improve animal welfare practices and outcomes. He said that many of Australia’s competitors in the global supply of livestock had either no standards or standards that were significantly inferior to Australia. In addition, Mr Hall said the industry had an exceptionally credible record for onboard management of live animals, with more than 99 per cent of cattle surviving overseas shipment. “But we are still investing and looking at ways to improve,” he said. | SOURCE: TOWNSVILLE BULLETIN, 22/5/06

BRUNEI

BRUNEI SETS UP NEW REGULATORY BOARD FOR ISLAMIC BANKING

The oil-rich sultanate of Brunei has set up a new government board to regulate banking and financial businesses based on Islamic principles, officials said. The Ministry of Finance said the Shari’ah Financial Supervisory Board was the main authority for Islamic banking and other businesses based on Shari’ah principles, which ban investments that pay interest or that derive profit from alcohol, tobacco, pork, gambling or weapons. Members of the board were appointed by Sultan Hassanal Bolkiah in February, the ministry said in a statement without explaining why the formal announcement had been delayed. “With the enactment of this order, any business dealings of financial institutions in Brunei Darussalam concerning the distribution of Islamic products is required to be submitted to the board for approval,’’ the statement said. Board members included senior finance ministry officials, a Shari’ah High Court judge, a top Muslim cleric and legal specialists, the ministry added. | SOURCE: ASSOCIATED PRESS, 13/6/06

Check out the GlobalNEWS at

www.halaljournal.com Global News At A Glance covers more news items in headlines and key points to give our readers a more comprehensive picture of events and trends in the Halal market around the world. Read and download, free of charge.

28 MAY-1 JUNE 2006 FOOD & HOTEL ARABIA 2006 Saudi Arabia’s International Event for Food, Beverages & Catering, Hotel Equipment, Supplies and Services Jeddah Int’l Exhibition & Convention Centre Jeddah, Saudi Arabia Tel: +44 20 7223 3431 Fax: +44 (0)20 7228 4229 Email: international@acexpos.com www.acexpos.com 29-31 MAY 2006 SIAL CHINA 2006 Asia’s Food Marketplace Shangai New Int’l Expo Centre Shanghai, China MS. CHRISTELL DOUILLARD Tel: +603 2718 9888 Fax: +603 2718 9889 Email: Malaysia@promosalons.com www.sialchina.com 9-11 JUNE 2006 INTERNATIONAL ISLAMIC FAIR Islamic products and services for all PWTC, Kuala Lumpur, Malaysia Tel: 4251 8792 Fax: 4256 2030 Email: absaba@saba.com.my www.int-islamic-fair.com 14-15 JUNE 2006 WORLD FOOD MARKET Paris Halal Exhibition Porte de Versailles Paris, France ALGODOAL Tel: +33 145 238 110 Fax: +33 147 705 175 Email: a.bonnel@ethnicfoodshow.com www.ethnicfoodshow.com 21-14 JUNE 2006 FOOD TAIPEI 2006 International Food Show Taipei World Trade Centre Taipei, Taiwan Email: foodshow@taitra.org.tw www.taipeitradeshows.com.tw/food/ 6-9 JULY 2006 FOOD-PACK MALAYSIA 2006 Malaysia Int’l Food Processing & Packaging Exhibition Putra World Trade Centre Kuala Lumpur, Malaysia Tel: +603 9132 1922 Fax: +603 9133 1920 Email: esmass@po.jaring.my www.esmass.com 6-9 SEPTEMBER 2006 BAKERY INDONESIA 2006 Bakery & Confectionery, Machinery, Equipment, Supplies, Ingredients Jakarta International Expo Kemayoran, Indonesia KRISTA EXHIBITIONS Tel: +6221 634 5861 Fax: +6221 634 0140 Email: info@kristamedia.com www.kristamedia.com 11-13 SEPTEMBER 2006 DUBAI INTERNATIONAL HALAL SHOW 2006 Crowne Plaza Hotel Dubai, UAE EXPAM Tel: +603 7880 0413 Fax: +603 7880 2817 Email: sales@halaldubai.com www.haladubai.com

12 THE HALAL JOURNAL

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SERIES

Against a backdrop of phenomenal growth globally, the

developments within the Halal industry is too significant to be ignored. Food and services sector being the obvious beneficiary of

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WORKSHOP SERIE 1 Achieving Success in the Global Halal Marketplace WORKSHOP DIRECTOR

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Dr. Robin Abdul Wahab

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8 Aug 2006

15 Sept 2006

MAIN TOPICS COVERED

MAIN TOPICS COVERED

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• Understanding the global Halal market • Taking advantage of local opportunities • Branding and Marketing • How to position your products to enter the market

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• The benefits of a Halal certified restaurant • Understanding Halal • Practical approach to the Halal process • Becoming Halal certified

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CLAIMABLE UNDER HRDF-SBL SCHEME! News.indd 13

7/5/06 2:23:00 PM


between the lines

Reflections and Resolutions Words By HAJJ ABDALHAMID EVANS

T

Events come and go, but we all had the feeling that the World Halal Forum would be different; not just ‘another conference’, but an event that would actually achieve something. Now, with WHF 2007 already in our sights, and we are getting a sense of what actually happened.

he whole team at KasehDia had a very clear intention on what we wanted from the inaugural WHF. We wanted to bring people together and to send a message: that Halal is not just an obscure niche market; that Halal has enormous potential; that Halal can be a major market force; and that Halal is BIG. We received plenty of feedback during and immediately after the WHF, 95 per cent of it positive, from the biggest MNC’s down to the smallest SME’s. However, it was only during a meeting in early June, at the Malaysian branch of one of the world’s leading food and cosmetic manufacturers, that we got a clear snapshot of the impact of the event. The MNC director, who had attended the WHF, told us that the event was a real eye-opener; she had no idea of how important the Halal market was and how diverse. From animal feed to logistics this particular MNC also had no idea how many major-league player – and which ones – were already so well positioned in the Halal sector. So, with an urgent sense that she was now playing catch-up, she wanted to see how to position their Malaysian branch as their ‘Centre of Halal Excellence’ (a term coined at The Halal Journal, incidentally.) This reflects the positioning moves being made by the big corporations. With Tesco, McDonalds and Nestlé using the WHF to confirm their Halal market credibility, it left many other big guns – both corporate and also national development agencies –hoping that they had not just missed a very important boat. We are clearly seeing the emergence of the Centres of Halal Excellence (or CHEs as I suppose we should call them now) developing as a model for the MNCs. And if Malaysia can a) see the opportunity clearly enough to act on it; and b) clear a path through the dense bureaucratic undergrowth to allow this opportunity to bear fruit, we may well see more MNCs making their CHEs in Malaysia. While the big players were very much in evidence at the WHF – and rightly so, given that the event was aimed to be a representational cross-section – it was the smaller companies, and especially the Muslim overseas visitors, who brought the greatest sense of enthusiasm and hope. So while the waters of the Halal market are currently dominated by the big non-Muslim players, like big tankers slowly following

So while the waters of the Halal market are currently dominated by the big non-Muslim players, like big tankers slowly following their trade routes, we could recognise among the delegates that there was an as yet untapped spring of enthusiasm, concern and drive to make Halal reach its fullest potential. their trade routes, we could recognise among the delegates that there was an as yet untapped spring of enthusiasm, concern and drive to make Halal reach its fullest potential. And these smaller players, while they do not have size on their side, have the advantage of being able to move faster, make quicker decisions and manoeuvre with more agility. They can also talk to the press without having to worry about shareholders, a point which was driven home by the refusal of one of the Big Guns to do an interview with the BBC for fear of the ‘implications’. TALKING ‘BOUT A RESOLUTION When the dust has settled and the piles of business cards are sorted, we are left with the resolutions of the Forum; and in many respects, the two resolutions of WHF 2006 summed up the aspirations of the whole event. The second resolution,

which as someone rightly pointed out ought to have been the first, was that the Islamic Development Bank should create a fund to enable the developing Muslim nations and – significantly – the Muslim minorities in non-Muslim countries to play a bigger role in the Halal market. It would be unfair to say ‘and about time too’ given that the Halal market has only recently really come up on the radar as a big blip, but at the same time, we have to reflect, yet again, that the position of the Muslims as passive consumers in the Halal market arena is simply not acceptable. It might be an accurate barometer reading of the fiscal geopolitics of the age we live in, but we sincerely hope that this resolution will not end up on the same dusty table that the 400-odd OIC resolutions are currently piled up on, quietly minding their own business and chatting amongst themselves. I imagine that it is our collective task to see that this is not the case. As for the other resolution, to form some kind of International Halal Industry Association, I am pleased to report that this one is well underway. And further than that I am not going to comment, other than to say ‘watch this space’. We ourselves undertook the responsibility to make this happen for our collective benefit, and we do not underestimate the importance – nor the weight – of this. Please be patient; it is on the near horizon and getting bigger. hj The writer can be contacted at hamid@kasehdia.com

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MATRADE news

THE MALAYSIA EXPORT EXHIBITION CENTRE (MEEC)

Strategically located in the centre of Kuala Lumpur, the Malaysian Export Exhibition Centre (MEEC) is a permanent exhibition centre for Malaysian made products and services. It provides information on all of MATRADE’s range of services, including promotional programs, facilities, publications, information, and networking. It also offers consultancy services to clients and visitors, both from local and overseas, with sessions held throughout the year. To date, a total of 240 companies have participated in this year’s session. Within MEEC’s 1,131 square meters of facility, there are seven sections of display areas, including booths for products and services, Malaysian brands, industry excellence area, award winner’s booth and office furniture area. It also houses an open area for larger products such as machineries and doors, as well as a lifestyle area encompassing

i

indoor and outdoor furniture. MEEC also advice and re-direct clients on the services provided by other organisations outside of MATRADE’s range of expertise. Officers will attend to visitors and help arrange for appointments with featured exhibitors, essentially providing a venue for incoming buying missions. Companies that are eligible to exhibit their products in MEEC must be a member of MATRADE and must be manufacturers, traders and service providers of Malaysian-made products and services. Priorities are given to new applicants who produce products and services deemed suitable for the export market and are manufactured by export-capable companies. Participation fee is RM1,200

For more information contact MATRADE HEADQUATERS 7th Floor, Wisma Sime Darby, Jalan Raja Laut, 50350 Kuala Lumpur, MALAYSIA t +603 2616-3333 f +603 2694-7363 toll free 1 800 88 7280 e-mail info@matrade.gov.my

per session per year for booth and lifestyle section, both the indoor and outdoor area, and RM600 per session per year for services and small items within the lifestyle area, such as table lamps, table wares, bedspread, cushions, etc. Some of benefits of MEEC to the foreign visitors include the convenience of viewing exhibits of Malaysian-made products and the accessibility to promotional materials and contact details of MEEC exhibitors, including product catalogues, flyers and business cards. Visitors will also have trained staff at their disposal to respond to impromptu enquiries as well as the assistance of MATRADE officials in arranging business meetings with featured Malaysian hj companies without charge. For more info, please log on to www.matrade.gov.my or call MEEC at +603-2692 8122.

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feature highlights

Meet the New Role Models In every industry, the celebration of the best happens almost every year. This year, for the first time ever, eight outstanding individuals in the Halal industry who have demonstrated nothing but commitment, pioneering innovation and success in the Halal industry were given due recognition and acknowledgement with the presentation of the Halal Journal Awards 2006. Singled out as the only awards ceremony dedicated to recognising milestones in the Halal industry, the aim of the The Halal Journal Awards from the very beginning has been to promote and strengthen the Halal industry worldwide. Presented by the Malaysian Prime Minister Dato’ Seri Abdullah Haji Ahmad Badawi, the awards were given out in eight categories at the gala dinner of the World Halal Forum in May and witnessed by a gathering of the who’s who in the industry. These are the pioneers of the Halal industry, the role models of today: BEST HALAL PRODUCT 2006 : MIDAMAR CORPORATION, USA

Midamar Corporation is a leading distributor of quality Halal meat and food products in North America and a respected exporter in more than 35 countries worldwide. In 2004, the US beef export ban effectively cut-of supplies of beef bacon and sausage items to the international retail and food service sectors. To restore supply, Midamar responded with the creation of a range of turkey-based products. Combining good taste and upmarket packaging, this resulted in the production of top-selling products such as the Seasoned Turkey Topping Pizza and the Turkey Sausage with Pepperoni Pizza. Turning a problem into an opportunity, Midamar demonstrated its awardwinning ability in pioneering a

creative and successful solution in the face of adversity.

upmarket and stylish manner to acquire universal appeal.

MOST CREATIVE MARKETING CAMPAIGN 2006 : AL ISLAMI FOODS, DUBAI

BEST ISLAMIC FINANCIAL SERVICE OR PRODUCT 2006 : MICROLINK SYSTEMS SDN BHD

Al Islami Foods is a leading provider of quality Halal products in the United Arab Emirates (UAE) and the Middle East. Among the many high profile marketing campaigns, their most famous was their 5,000 Mini’s campaign in 2005, when they gave away both real and model Mini Cooper cars. In 2006, with their name change and corporate re-branding campaign, they embarked on their most ambitious marketing and branding campaign to date. Reflecting their ambition of becoming a major market player, Al Islami is leading the way by using traditional Arab and Islamic values in a contemporary,

By developing flexible opensource software modules, Microlink Systems Sdn Bhd have ensured that their Islamic banking software can be plugged in to any conventional banking software. By developing their Islamic banking software from the ground up, Microlink have been able to build in the required flexibility that enables banks to make a streamlined transition from conventional to Islamic banking with maximum speed and minimum disruption.

of Tan Sri Dato’ Muhammad Ali Hashim, Johor Corporation has taken Corporate Social Responsibility (CSR) to a new level. With projects covering healthcare, education and orphanages, Johor Corporation has revitalised the Islamic concept of waqaf, and brought it into the 21st century. By creating selffunding sustainable social welfare projects, they have ensured that the benefits that are generated by these self-sustaining projects bring long-term help and support to those in need. The revival and modernisation of the Islamic waqaf is itself an achievement that deserves to be replicated in all corners of the Muslim and non-Muslim world.

BEST CORPORATE SOCIAL RESPONSIBILITY PROJECT 2006 : JOHOR CORPORATION

Under the inspired leadership

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for the Halal Industry... TRAVEL AND HOSPITALITY 2006 : LSG SKY CHEFS-BRAHIM’S

By supplying over 30,000 Halal meals to 26 different airlines every day from their base at KLIA, LSG Sky Chefs-Brahim’s have become the undisputed leaders in the supply of Halal airline food. By their efficient combination of strict Halalcompliance and creative recipes, LSG Sky Chefs-Brahim’s have removed any element of doubt for Muslim travellers, and replaced it with confidence and good taste. By incorporating innovations, such as adapting the LEAN process from the automotive industry for their own process flow, as well as developing the world’s first samak clay industrial dish-washing machine, they have demonstrated how to combine the past with the future to become industry leaders in their own field. BEST HALAL RELATED SERVICE PROVIDER 2006 : MALAYSIAN INTERNATIONAL HALAL SHOWCASE (MIHAS)

By creating the world’s first exclusively Halal Trade Event in 2004, the Malaysian International Halal Showcase

MIHAS has pioneered the task of bringing together buyers and sellers to stimulate trade and promote the Halal industry. Achieving sales of RM168.3 million in 2006 and attracting 27,500 visitors from 60 countries, MIHAS continues to provide an indispensable service to all companies involved in the Halal market. In addition to starting a worldwide trend, MIHAS continues to set the standard for all other Halal-related trade events around the world. In addition to serving the domestic Halal industry players, MIHAS has become a showcase for Halal products and services from all corners of the world, and has thereby evolved into a truly international event of pivotal importance to the rapidly developing global Halal market. BEST INNOVATION IN HALAL INDUSTRY 2006 : THE HALAL SCIENCE CENTER, CHULALONGKORN UNIVERSITY

The Halal Science Center has been building on their work in Chulalongkorn University over the years. By developing a combined Halal-HACCP-GMP standard in 1993, and offering a BSc programme in Halal

Science, this institution has been a world pioneer in the promotion and propagation of Halal science. With a grant from the Thai government in 2003, the Halal Science Centre at Chulalongkorn University in Bangkok became the first dedicated Halal Science institution in the world. Led by Dr. Winai Dahlan, the dedicated team at the Halal Science Centre continues to champion a range of Halal-related projects that provide valuable scientific knowledge to strengthen and stimulate the Halal market, not just in Thailand and South East Asia, but also around the world. OUTSTANDING PERSONAL ACHIEVEMENT IN THE HALAL INDUSTRY 2006 : DATO’ JAMALUDDIN ABDUL KADIR.

After 15 years as a banker, Dato’ Jamaluddin successfully built Prima Agri-Products from a butcher shop in Taman Tun to a successful company with 200 employees, exporting over 200 different products to Europe, the Middle East and South East Asia. By going on to develop the Prima production park in Kuantan, Malaysia Dato’ Jamaluddin has turned his own success into an avenue of

opportunity for others. Offering turnkey opportunities to up and coming small enterprises and companies, Prima’s business model allows newcomers to utilise Prima’s 20 years of experience and expertise to build their own success. Far from resting on the laurels of his own success, Dato’ Jamaluddin has set an example of creative thinking, entrepreneurial initiative and a generosity of spirit that not only benefits Malaysia’s national Halal Hub ambitions, but has also created a model that can be emulated across the world. From a small butchers shop, to building a company that supplies some of the world’s leading international hotels, supermarkets and restaurant chains, to developing a food production business model that will bring benefit and capacity building wherever it is replicated, Dato’ Jamaluddin has blazed a trail that any of us would be proud to follow. hj

The Halal Journal Awards 2007 is now open for company nominations. For further information, please visit www.halaljournal.com THE HALAL JOURNAL 19

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It’s the age old question that often holds back many local Halal manufacturers – how do they get their products onto the shelves of international retailers? Tesco Malaysia’s director of corporate communications Azlam Shah Alias spoke to The Halal Journal on what it takes to sell on their UK shelves.

MALAYSIAN HALAL PRODUCTS Words By KAMARUL AZNAM KAMARUZAMAN

FOR TESCO

UK

to call Tesco’s office, there are a few basic rules with regards to retailing in the UK as explained by Azlam Shah Alias, director of corporate communications, Tesco Malaysia. First, there must be a demand for any given product, and in this case, it must be Halal certified. Second, all products must pass the strict British Retailers’ Consortium (BRC) standards. Third, manufacturers need to understand that the liability of the products sold in the UK is on the retailers, not the government, hence the strict safety requirements.

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ven before the dust had settled on MIHAS 2006 and the inaugural World Halal Forum, Malaysia’s bid to become a leader within the global Halal industry was given yet another major boost when the local office of Tesco, the world’s third largest retail chain operator, announced its intention to export RM1 billion worth of Malaysian Halal products into their main market in the UK over the next five years. Under a strategic move to support the Ninth Malaysia Plan and the Halal hub initiative, Tesco Malaysia will not only export local Halal products to the UK, they also announced plans to buy RM100 million worth of agriculture products from the Perak state government to complement their new RM50 million fresh distribution centre in Simpang Pulai, near Ipoh, Perak. During the signing ceremony witnessed by the Prime Minister Dato’ Seri Abdullah Ahmad Badawi, James McCaan, chief executive officer of Tesco Malaysia said they have identified three opportunity areas to offer local Halal manufacturers, namely access to export

markets, access to national domestic market as well as offering help in maintaining quality, consistency and price of local Malaysian produce. “Tesco is extremely pleased to be able to offer this support to the Malaysian government. The export of RM1 billion of Halal products to the UK will really help Malaysia to develop quickly into a global Halal hub,” said McCaan. Apart from that, Tesco Malaysia will also assist local suppliers to supply products under the Tesco brand name locally and internationally, and will work with the state governments and local chambers of commerce to maximise local sourcing opportunities. Before one jumps on the phone

To start the ball rolling, manufacturers of Halal finished products are invited to contact the local Tesco headquarters in Damansara directly. A team called the Training, Legal and Technical Department (TLT) headed and comprised of food technologists will then take samples for the products and test them for food safety standards to make sure that it is in fact safe, hygienic and traceable. They will then audit the manufacturing processes to make sure that it satisfies the requirements of Hazards Analysis and Critical Control Points and General Manufacturing Practices. The BRC also prefers all products to have Quality Management System in place. Part of the requirements is to make sure that all documentations are in order and there exist accountability and transparency. Once the BRC’s standards are satisfied, the product will have automatic passport to go anywhere in the world. To supply to UK stores, Tesco’s local TLT team will also send samples of product to the TLT in UK to determine if the product is actually in demand and up to their standards. “We have our ethnic buyers in UK who will be able to tell whether the products are acceptable or not,” said Azlam. He added that even before sending

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to UK, their TLT in Malaysia will know exactly what the requirements are for the UK market. Once both offices are satisfied that the particular product meets their safety requirements, they will then start to look at the standards and later discuss its terms and conditions.

SUPPLY & DEMAND

Expressing his confidence that Halal products are very much in demand in the UK and the Halal industry is actually thriving over there, Azlam pointed out that they have done a similar program in 2004 where they stocked their shelves with Halal and ethnic goods. Through the many market research and customer questionnaires, they found that customers in UK actually wanted more Halal-certified products than the ethnic foods. “We first tested in one particular store in Slough where there were requests for Halal meat. So we opened a butcher shop selling Halal meat and that was an overwhelming success. Using that same concept, we extended our ethnic range by providing more ethnic foods and we also opened up a section on Halal food, and that too created a lot of interest and people started asking for more. Again, the success was overwhelming and that was when we realised there is this huge demand for Halal products. Now we are going ahead to sell in about 50 stores all over UK,” he said. “And now we are trying to see if we can help the government to fast track the Halal hub initiative by sending more local Halal products overseas. But it all depends on the quality, price, availability, and of course demand. At the end of the day, if the product is not sellable, there is nothing much we can do, regardless of how much instore promotions we carry out,” he added. That should be the challenge for local Halal manufacturers – to manufacture quality and sellable Halal products.

Azlam expects that the supply of local Halal finished products to UK will commence as early as 2007 when their RM50 million fresh distribution centre in Simpang Pulai is completed. Built on a 15-acre property, the centre will have 14,000 square metres of cold storage facility that will take in fresh produce from farmers around Cameron Highlands before re-distributing it back to all their 13 stores throughout Malaysia. In fact, Tesco has penned its commitment with the Perak state government to buy RM100 million worth of agricultural products over the next five years. Fresh produce does not only mean fruits and vegetables, it would also include poultry, meats and seafood. “As we speak, we already have three contracts that are in the finalising stage with some of the Perak suppliers to supply fish, prawns and poultry. We are also negotiating for some other products from local farmers,” Azlam added. According to him, Tesco currently does not own a fresh distribution centre in Malaysia except a temporary one in Balakong as it requires at least 12 – 15 stores to make it a cost effective exercise. Since they now have 13 stores, with their 14th store opening in Ampang by the end of July and another two sites pending for approval, Tesco is now ready to buy local agriculture produce on a huge scale. “As it is right now, suppliers are delivering directly to our stores, so it is a bit difficult for them, James McCaan, chief executive officer of Tesco Malaysia especially for smaller players. Once we have our distribution centre, end of the period, whoever is able there will be more opportunities for small holders to to deliver will survive,” said Azlam. supply directly to us. We are also working with the state government to identify other potential suppliers. As for the RM1 billion Halal They will grow whatever we want and we will teach exports to UK, the success of the them all the right methods in terms of making sure program will also depend upon the all of their products meet our standards,” he said. new fresh distribution centre, since He added that this is actually easier said than the centre will be responsible in done. Local farmers, by their very nature, need plenty ensuring that all finished products of training and Tesco uses a hands-on approach in meet the required BRC standards. educating these farmers. Tesco usually invites the To address this concern, they will be farmers to come to their stores, observe the back-ofworking with the Small and Medium house activities, how the produce are being handled Industries Development Corporation and cleaned. They are even asked to do the processes (SMIDEC) to ensure that the themselves, making sure they truly understand how suppliers meet their requirements. it works, from unloading right up to the shelves. “We are doing a three-pronged “But it is a long educational process. It took four to approach with SMIDEC. One is about five years in Thailand to come up with the level they are awareness and training to increase at now where produce are on the shelves in less than 24 level expertise of the suppliers. The hours after harvesting. Customers are very demanding, second is to open up export market they want freshness, and so do we. But some farmers do within Tesco where the suppliers are not understand, so we have to be transparent. We tell ready and have the products but them the price and the volume for one year, and they don’t have the market to supply. For must tell us whether they are able to deliver or not. At the

“TESCO IS EXTREMELY PLEASED TO BE ABLE TO OFFER THIS SUPPORT TO THE MALAYSIAN GOVERNMENT. THE EXPORT OF RM1 BILLION OF HALAL PRODUCTS TO THE UK WILL REALLY HELP MALAYSIA TO DEVELOP QUICKLY INTO A GLOBAL HALAL HUB,”

this, we will link them up with our international sourcing hub in Hong Kong. Aside from sourcing for viable companies, SMIDEC will also help us to build capacity and capability within the Halal industry,” he added. One of the key steps that have been undertaken by Tesco Malaysia is to develop a Supplier Guidelines Communication Pack for potential suppliers, as well as organising seminars and workshops for local suppliers on supplying to hypermarkets like Tesco. The most recent was in early May when Terry Babbs, head of Tesco’s TLT UK came over and gave a talk about supplying there. He later spoke at the inaugural World Halal Forum about a supermarket’s perspective on Halal food. Aside from the fresh distribution centre in Ipoh, Tesco Malaysia will also build an ambient distribution centre in the Klang Valley, which is expected to be ready by 2008. But they are not waiting for the new centre to start supplying Halal products to the UK. As it is, they will be pushing for some of their in-house labels that have met the BRC standard for exports to UK. “At the same time, we are also looking at some of the more established names in Malaysia which we think can penetrate the UK market, which are mostly within the ready-to-cook meal segments, and also some of the spices, herbs and sauces. We are also talking to a few interested parties to supply, so it will just be a matter of time,” he said.

hj

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MAY 8 – 10, 2006 CAME AND WENT LIKE ANY OTHER DATES FOR MOST, BUT FOR THE GLOBAL HALAL INDUSTRY AND RETAILERS, IT WAS THE BEGINNING OF A SIGNIFICANT TRANSITION. KAMARUL AZNAM KAMARUZAMAN WRITES OF HIS ONCE-IN-A-LIFETIME EXPERIENCE.

THE TRUE POWERS

OF HALAL

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“THE WORLD HALAL FORUM IS AN UNPARALLELED INTRODUCTION TO THE GREAT POTENTIAL OF THIS MARKET. IT IS ALSO AN EXCELLENT DEMONSTRATION TO THE WORLD THAT THE RELIGION OF ISLAM CAN BE A STRONG IMPERATIVE FOR TRADE AND PROSPERITY THEREFORE CHALLENGING THE UNFAIR AND NARROW STEREOTYPES THAT HAVE BECOME SO PREVALENT OVER THE LAST FEW YEARS”. Khairy Jamaluddin, Chairman, World Halal Forum

“AS THE HALAL MARKET CONTINUES TO GROW IN STRENGTH AND DIVERSITY, THE NEED FOR GLOBALLY ACCEPTED BEST PRACTICES AND STANDARDS FOR AUDITING AND CERTIFICATION OF ‘HALAL’ BECOME INCREASINGLY APPARENT. THE NEED TO ENSURE THAT BOTH INVESTOR AND CONSUMER INTERESTS ARE PROTECTED REQUIRES ALL STAKEHOLDERS TO WORK TOGETHER TO CREATE STANDARDS AND PROCEDURES THAT WILL ALLOW THE INDUSTRY TO CONTINUE TO GROW STRONGLY”. Dato’ Seri Abdullah Ahmad Badawi, Prime Minister of Malaysia

“PERCEPTION HAS CHANGED WHEREBY ISLAMIC BANKING IS SEEN AS AN ALTERNATIVE AS THE PRODUCTS ARE BECOMING MORE COMPETITIVE COMPARED TO THE CONVENTIONAL PRODUCTS. HENCE, THE MARKET IS MORE AWARE AND KNOWLEDGEABLE ABOUT ISLAMIC PRODUCTS”. Badlisyah Abdul Ghani, Group Head, Islamic Banking Division, CIMB Banking Group , Malaysia

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irectors of multinational corporations, global fast food giants, port authorities, shipping heads, global exporters, banking and finance specialists, abattoirs, animal feed producers, Muslim clergymen, entrepreneurs, standards practitioners as well as local and international media. They were among the700 from all over the world who attended what has been billed as the Halal industry event of the year. The World Halal Forum (WHF) was an interesting and engaging affair as it focused on the business perspective of doing Halal, from an industry point of view. That was the lure of this event – a slightly unorthodox approach to Halal events without neglecting any of the orthodox Halal practices established some 1,400 years ago. There was also another unorthodox approach, as far as event management was concerned. If others ended their event with a gala dinner, WHF started with one in order to bring the full spectrum of the industry together for the first time. It was all glitter and glamour that night, as Dato’ Seri Abdullah Ahmad Badawi, the Prime Minister of Malaysia delivered his keynote address and officiated the event with a Bismillah. The premier gave the commitment of his

“THE MULTI-CULTURAL NATURE OF THE POPULATIONS (IN SOUTHEAST ASIA) HAS MADE HALAL CERTIFICATION A MUCH MORE IMPORTANT ISSUE. SINGAPORE, THAILAND, INDONESIA AND MALAYSIA MAKE UP THE ‘BIG FOUR’ IN TERMS OF HALAL CERTIFIED PRODUCT OFFERS.” Jumaatun Azmi, Managing Director, KasehDia, Malaysia

administration to promote Halal onto the global arena. He reasoned that Malaysia, as a nation fast developing in both economic and social spheres, and with its diversity of communities, cultures and religions, has seen how important Halal can play in its society. Having one of the most organised Halal plan in place, Malaysia can play a leading role in forging the exchange of ideas and encourage greater collaboration between Halal industry players. These are not just the words of a politician. He was speaking as a Muslim head of state, and the audience felt the sincerity in his tone. He said, “This is a marketplace that has enormous potential, with plenty of room for participants from all sectors and from all countries. Indeed, we welcome such participation from all quarters in our desire to see the Halal industry - locally,

regionally and globally - go from strength to strength.” The forum’s chairman, Khairy Jamaluddin also gave a riveting speech on how the event came to be and what it hoped to achieve. “In less than 20 years, 30 per cent of the global population will practice Islam as their religion. In many European countries, and in the USA, Muslims are poised to become the most significant minority population. It is against this remarkable evolving background that we are all gathered for this inaugural World Halal Forum, seeking to chart the future of the global Halal market for the first time. The entire value chain of the Halal industry is represented here, to discuss best business practices, highlight market access and opportunities and to hear and consider issues of concern to the Halal industry.” The prime minister, accompanied by the

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“WE’RE USING MALAYSIA AS A GUIDE ON HOW TO GET CERTIFIED AND TO BETTER UNDERSTAND WHAT HALAL REQUIREMENTS ARE. THERE ARE OVER TWO BILLION MUSLIM CONSUMERS IN THE WORLD, SO WE NEED TO ADDRESS THAT MARKET” (QUOTING DATO’FRITS VAN DIJK, NESTLE EXECUTIVE VICE PRESIDENT, ZONE ASIA, OCEANA, AFRICA AND MIDDLE EAST).” Sullivan O’Carroll, Managing Director, Nestlé Malaysia

“THERE ARE TOO MANY DEFINITIONS FOR HALAL. IT DIFFERS IN TERM OF SLAUGHTERING, STUNNING, INGREDIENTS AND ANIMAL FEED. THIS MAKES CONSUMERS CONFUSED. SOME HALAL PRODUCTS AVAILABLE ARE ACTUALLY FAR FROM HALAL”. Mustafa Jassem, Al Islami Foods, Dubai

forum chairman later went on to present the inaugural Halal Journal Awards 2006 to eight recipients during the gala dinner, all of whom were champions within their respective fields, honouring outstanding achievement and innovation in the Halal market. Their contribution to the industry was acknowledged, and the finely crafted pewterware served as a small token of appreciation for their immense contribution to the global Halal industry. It encourages them to strive even harder, as the bars are raised and expectations doubled (see story on page 18).

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ixteen speakers, ten panellists and over 700 participants and the media converged in the same ballroom the next morning to begin the first real meeting of minds between the global Halal players. Jumaatun Azmi, managing director of KasehDia Sdn Bhd and editor of The Halal Journal, a business, lifestyle and trends magazine for the Halal industry, first took to the rostrum with an intriguing update of the global Halal market place and highlighted its enormous potential once fully realised. Her speech set the tone for the entire event. She also pointed out an interesting point for all to ponder – “The appeal of Halal is widespread; it has universal appeal; Halal stands on its own

“IT MUST BE EMPHASISED THAT THE TERM HALAL IS NOT CONFINED ONLY TO THE ISLAMIC METHOD OF SLAUGHTER BUT IS ALL ENCOMPASSING, STARTING FROM WELFARE AND HEALTH OF THE LIVESTOCK, TO THE ISLAMIC METHOD OF SLAUGHTER, TO PRESCRIBED PRACTICES IN CARCASS DRESSING AND PROCESSING”. Rashid Kadimi, Chief Executive Officer, Allanasons, India

“SICPA HALALTRACE™ OFFERS A COMPLETE SOLUTION TO AUTHENTICATE, TRACK AND TRACE PRODUCTS FROM THE START OF THE MANUFACTURING PROCESS, THROUGH THE LOGISTICS OF TRANSPORT AND DISTRIBUTION, TO THE FINAL CONSUMER, WHO CAN BE CERTAIN THAT THE PRODUCT HE OR SHE IS CONSUMING IS GENUINE AND CERTIFIED IN ALL RESPECTS” Alain Marchand, Director, SICPA Product Security, Switzerland

BADLISYAH ALSO INTRODUCED AN ORIGINAL CONCEPT OF “HALAL MARKET ECONOMY”, A SCENARIO WHEN HALAL BUSINESSES OPTED TO USE PURELY HALAL FUNDING. merits; merits which, as we speak now, have hardly begun to be utilised and realised from a marketing perspective.” (see story on page 38) It made perfect sense. Halal products have so far been selling based solely on the necessity for Muslims to eat what is permissible. No ads, no campaigns, just pure faith. Based on that fact alone, the market has been estimated to be worth a few trillion dollars annually. Imagine how huge the Halal industry could be if it had a comprehensive marketing plan, including branding and media relation strategies. Islamic banking is an example of a wellexecuted marketing campaign and Halal can learn a thing or two from developments within this sector.

Complementing Jumaatun on the topic of Islamic banking was Badlisyah Abdul Ghani, group head for Islamic banking division of CIMB Islamic. He pointed out the reason why Malaysia currently leads in terms of total assets within Islamic banking – 70 per cent of its customers are non Muslims. The answer as to why this happened is simply because Islamic banking products have become much more competitive against the conventional and this made the consumers more interested and knowledgeable about Islamic financial products. The same strategy can be used for Halal food and services. Badlisyah also introduced an original concept of “Halal market economy”, a scenario when Halal businesses opted THE HALAL JOURNAL

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“THERE ARE TREMENDOUS OPPORTUNITIES FOR EVERYONE PARTICIPATING IN THE HALAL HUB IN PORT KLANG. THERE IS NO DOUBT THAT PORT KLANG IS GOING TO LEAD MALAYSIA IN BECOMING THE NEXT HALAL HUB FOR THE WORLD. GIVE IT ONE OR TWO YEARS, MALAYSIA IS DEFINITELY GOING TO ACHIEVE THAT STATUS”. Tan Sri Datuk G.Gnanalingam, Executive Chairman, Westports Malaysia

“IN ORDER TO PROTECT THEIR CONSUMERS, DEVELOPED NATIONS ALWAYS USE THE MOST HI-TECH MEANS. HOW ABOUT US? ARE WE USING RUSTED SWORD? DO WE PROTECT OUR MUSLIM CONSUMERS ESPECIALLY ON SPIRITUAL SAFETY ISSUE WELL?” Dr Winai Dahlan, Director, Halal Science Centre, Chulalongkorn University, Thailand

to use purely Halal funding. This simple act of staying away from riba’ on Halal projects would actually open up a whole new market paradigm, one that can shape the future society that is fully in-tuned with the principles of Shariah. One would only dare to dream of such characteristics of a “Shariah-compliant society” – narrower gap between the rich and the poor, less social ills and definitely more barakah – the source of strength for the olden Muslim civilisations. Other notable presenters included Bahri Ouzariah from Idena Nutrition Animale, France, who argued that Halal goes beyond merely monitoring the proper method of animal slaughter. He highlighted the need for Halal animal feed and nutrition since the animals today are mostly bred out of economic considerations and are fed unimaginable things, some Halal, some not. He urged meat importers to understand the current processes of animal feed and demand for Halal feed. It was simply a matter of awareness, Bahri concluded.

W

ithin the Halal food manufacturing segments, speakers from Nestle, LSG Skychefs-Brahims and Al Islami Foods, Dubai, all leaders

“OUR MISSION STATEMENT IS TO BE THE PREMIER GLOBAL PROVIDER OF QUALITY HALAL CATERING AND INTEGRATED IN-FLIGHT SOLUTIONS”. Datuk Ibrahim Badawi, Chairman, LSG Sky Chefs-Brahim’s, Malaysia

“THE PORT OF ROTTERDAM AUTHORITY TOGETHER WITH MARKET PARTIES INTENDS TO DEVELOP A HALAL LOGISTIC CONCEPT; OFFERING ENTIRE HALAL SUPPLY CHAIN SOLUTIONS AND DEVELOPING A DEDICATED WAREHOUSE FOR HALAL PRODUCTS IN THE PORT OF ROTTERDAM”. Captain C.J. Weststrate, Senior Business Development Manager, Port Of Rotterdam

WITHIN THE HALAL FOOD MANUFACTURING SEGMENTS, ALL LEADERS WITHIN THEIR OWN INDUSTRIES, REINFORCED THE NEED TO DEVELOP THE GLOBAL HALAL FOOD MANUFACTURING INDUSTRY. within their own industries, reinforced the need to develop the global Halal food manufacturing industry. Malaysian Halal standards and certification are well recognised around the Muslim world and large food retailers should take cues from the farsightedness of Nestle Malaysia and LSG Skychefs-Brahims in tapping this wealth of Halal certification expertise. Dr. Habib M’Nasria, a quality assurance director for McDonald’s Middle East and Africa also gave an indepth look at the myriad of Halal-related issues being faced by the world’s largest fast food retailer on a global basis. Because they are in 120

countries, including all of the Muslim countries around the world, McDonald’s are being confronted with a myriad of global Halal issues, as he dealt with them based on facts from the Al Quran and As Sunnah. Issues that he cannot find solutions for, he urged for them to be researched and addressed by credible Halal certifiers under the OIC or Muslim league umbrella for the benefit of the ummah (see story on page 34). Developments within emerging Halal segments, Halal logistics in particular, were also addressed. Among those who presented their vision for a global Halal gateway was Port of

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WORLD HALAL FORUM KEY POINTS AND RESOLUTIONS Through the collective voice of all presenters, panellists and participants, the three-day inaugural World Halal Forum (WHF) has drawn up some key points and two important resolutions for Halal scholars, practitioners and certifiers to find some traction within the industry. 1. The Halal industry can learn and benefit much from Islamic banking and finance, which has developed from a niche market into a mainstream market, and has moved forward in setting up registration and legislation.

The World Halal Forum 2006 was extensively featured in all major Malaysian media and various international mainstream media.

ABC Radio Australia

Muslim Guardian Online

Agence France-Presse (AFP)

New Straits Times, Malaysia

Angloinfo.com

NUTRAingredients.com

AP-foodtechnology.com

People.com

2. Halal is a simple process. Many complications have been debated - some resolved, some not. WHF looked at issues concerning animal welfare, ranging from what they are fed with, i.e. the ingredients of animal feed, the methods of slaughter and also the practices of many organisations worldwide.

Associated Press (AP)

Q News

BBC News, UK

Radio Australia

3. WHF also discussed on ways the players of this industry can interact more effectively. This way, they can resolve the multiple variation of debates on certification and regulatory, and their differences across the vast geographical and cultural borders.

Berita Harian

Radio Free Europe/Radio Liberty Inc., Prague

Business Times

Radio Praque

China Broadcast.com

Shippingline.biz

China View, China

Sin Chew Daily

Dinar Standard Editor’s Blog, USA

South Asia Women’s Forum

Emel Magazine

The Edge Daily

Guardian.co.uk, UK

The Star, Malaysia

Harian Metro

Turkish Weekly

Hawaii Public Radio

Utusan Malaysia

Iran News Agency (IRNA)

Xinhua News Agency, China

(IRIB) News, Iran

Yahoo1 Finance

Islam Online, Qatar

Yahoo! News India

ITV Foundation South Africa

Yahoo! News

4. The forum also looked at issues and means for new scientific researches, which are undoubtedly relevant to the Halal industry. These include stunning, thoracic sticking, animal welfare and also storage. WHF also opened the gateway for scientific research in microbiology within this industry. 5. WHF have come to a conclusion that there is a need for greater Muslim involvement worldwide in this industry. So far, the Halal industry has been controlled by non-Muslim organisations and conventional banking. More needs to be done to encourage Muslim players to participate in this industry. It also hopes to see more international joint ventures to resolve problems regarding different beliefs or resolves between countries to help in research and development. The joint venture between Prima Agri-Products and Comgroup Australia is an excellent example. 6. Finally, no matter who the major players are in this industry, the biggest constituents are still the Muslim consumers and what they consider as Halal.

THE TWO RESOLUTIONS AGREED UPON DURING WORLD HALAL FORUM ARE: 1. The creation of an International Halal Alliance. This alliance will be a means for the industry players to interact and means of resource for service providers from all over the world. It will be a base of the global Halal industry and will help the interaction between governments, Halal legislators and certifying agencies. Members of this association will also be able to assist other industry players. Malaysia through WHF offered to be the secretariat and invited everyone to participate in this alliance. 2. The WHF also requested from the Islamic Development Bank (IDB) for a specific fund to be created to help develop the Halal industry in OIC member nations and Muslim minorities in nonMuslim countries. Early negotiations have been initiated and IDB has expressed their interest and willingness to participate.

AP-Dow Jones Meatprocess.com

Poultrex.com Radio USA Media Network SNNi.org

Monday Morning

The International News Hour

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“HALAL ANIMAL FEED, IS IT THE BEGINNING OF THE HALAL PROCESS? IF YOU EAT MEAT, MUST YOU ALSO BE CONCERNED ABOUT WHAT THE ANIMAL WAS FEEDING ON? AS A WORLDWIDE FIRM, WE KNOW THAT ANIMALS TODAY, BASED MOSTLY ON ECONOMIC CONSIDERATIONS, ARE FED ALL SORTS OF THINGS THAT THE AVERAGE CONSUMER WOULD NEVER IMAGINE… SOME ARE HALAL AND SOME ARE NOT.” Bahri Ouzariah, Export and Halal Director, IDENA (Innovation Développement En Nutrition Animale)

“OUR DEFINITION OF HALAL LOGISTICS IS A PROCESS OF PLANNING, IMPLEMENTING AND MANAGING EFFICIENT, SEAMLESS FLOW AND STORAGE OF HALAL CERTIFIED RAW MATERIALS, HALAL CERTIFIED SEMIFINISHED OR HALAL CERTIFIED FINISHED GOODS FROM SOURCE TO DEMAND POINT ENSURING FULL COMPLIANCE OF THE RECOGNISED HALAL LOGISTICS STANDARDS THROUGHOUT THE PROCESS”. Hilmi Mohd Nashir, Managing Director/ Chief Executive Officer, MISC Integrated Logistics Sdn Bhd Malaysia

“CUSTOMERS HAVE THE POWER OF CHOICE. THEY DECIDE EVERYTHING AND RETAILERS FOLLOW THEM. IF WE LISTEN CAREFULLY, CUSTOMERS WILL TELL US WHAT WE HAVE TO DO”. Terry Babbs, Group Trading Law & International Technical Director, Tesco UK

Rotterdam, Europe’s busiest and the world’s third largest port. Capt. CJ Weststrate enticed the audience with plans to build a European Halal Distribution Centre in Rotterdam, one that would provide a Shariah-compliant gateway for Halal products into Europe. Developments within the European Halal market is expected to be significant as it would play defining roles in other markets around the world.

A

s the day winds down, there was a general sense of wanting for more out of the forum by the participants. Within the main hall, participants started asking even more questions to the speakers, and the speakers obligingly spent more time in answering all of their queries. Media personnel were also scrambling to find people to be interviewed, stories to be written and deadlines to be met. The event even garnered RM4 million worth of PR value in Malaysia alone. In his closing remarks, forum chairman Khairy Jamaluddin commended the participants for staying right through the end. Of the 700 plus participants registered during the opening day, the event retained at least 80 per cent of its size at the time it ended. Most would have probably shed half, but not this particular forum. His observations also made us realised a

“THE COMPLICATIONS IN HALAL ARE DUE TO CHALLENGES BY MODERN MANUFACTURING REQUIREMENTS FOR LINE SPEED, ANIMAL WELFARE AND PRACTICES OF MUSLIM HALAL ORGANISATIONS IN THE EXPORTING COUNTRIES. Dr. Habib M’Nasria, Quality Assurance Director for Middle East and Africa, McDonald’s

simple verse from Al Quran - “O mankind, eat what is Halal and Tayyib from the earth.” Halal, like any other divine decree, has no preconceived logic attached to it. The core behind this desire to adhere is faith – by the two billion Muslims all over the world, eating what has been made permissible and lawful by Allah. From this simple act of obedience, a whole new market is created, and by the powers of Allah, created many other spill-over markets for the benefit of not just Muslims, but for mankind. The proof unveiled right before our eyes as people from different countries, of different races, cultures, even religion, came together in one room to discuss on Halal, a deeply religious topic in Islam. It benefited non Muslims as well, for speakers like Tan Sri G. Gnanalingam of Westports, Terry Babbs of Tesco or Capt. CJ Westrate of Rotterdam, as well as the 85 per cent

non Muslim Halal food manufacturers and suppliers who believed in the true powers of the Halal industry. The World Halal Forum had opened many eyes to the massive global appeal for Halal, and it provided a common platform for practitioners, manufacturers, even consumers to share and exchange ideas. The forum had achieved its objectives in helping to shape the global Halal market, to understand and solve challenges within the industry, and to create networking and facilitate trade between the different segments of the Halal market. The forum is the place to call home for all Halal industry members. More will be in place at the World Halal Forum 2007 as Malaysia celebrates her 50 years of independence and the designated Visit Malaysia Year. So mark your calendars for May 7 – 9, 2007.

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feature highlights Over RM168.3 million worth of sales, of which RM29.7 million were direct sales while sales under negotiation valued at RM38.6 million. Over 400 participants from 60 countries showcased their Halal wares and 27,500 visitors saw and sampled their products throughout the five-day event.

MEETING FRIENDS OF OLD AND NEW

at MIHAS 2006 BEYOND these facts and figures, the third Malaysian International Halal Showcase 2006 was not only a real eye opener to the true prospects of a global Halal market place but it was also the best platform for industry players to network and re-establish contacts with old friends, from different parts of the world. After three years of solidifying itself within the global Halal market place, MIHAS has managed to elevate itself into the ranks of “must attend” for many industry players. The theme for this year’s event - “Networking, Consolidating and Energising” truly reflected the comingof-age for this annual pilgrimage of global Halal players. Some say we tend to do business with friends, and the Halal industry is a good manifestation as MIHAS exhibitors found themselves amongst acquaintances, “united in pursuing God’s injunction to act and consume only those that are Halal and Tayyib,” as mentioned by the Malaysian Prime Minister Dato’ Sri Abdullah Ahmad Badawi in his speech read by his deputy during the launch. “I believe that there is considerable knowledge and experience that we can share and tap into from one another; and in doing so, demonstrate greater solidarity and take advantage of networking opportunities brought about by MIHAS,” he went on. After painstakingly building their respective businesses throughout the past year, MIHAS provided a great reason for traders and exhibitors to catch up with old acquaintances. And judging from the air of festivities surrounding the event, everybody seemed to be enjoying themselves rather than be

bogged down by sales quota or contact leads targets. There was certainly a sense of joy in meeting old friends and sincerity in sharing respective market info during this year’s MIHAS. “To me it was a success from all angles and MIHAS has become a permanent feature in our yearly calendar,” said Kadir Bustamam, a businessman from Singapore. “It was about doing business among Muslims who produce Halal food and other Halal products and we got to meet like-minded businessmen from all over the world. So yes, we were extremely satisfied with MIHAS and we look forward to coming here next year, every year in fact.” For others, a trip to MIHAS extended beyond just a simple business trip - it has now become a sacred duty. For

some, to be able to elevate the plight of one’s religion within the context of business and to get profit in the process is, in essence, the way of Prophet Muhammad saw. “I no longer view MIHAS as a business trip, it has become a religious duty of sort for me,” said Saeed Abubakr from UAE, who has been participating in MIHAS ever since it first started in 2004. “To be able to meet Muslim Halal entrepreneurs is already a rarity these days, and you get to meet so many here. To hear about their plans, their dreams…it is a privilege. To be able to play a part in it, I consider that as a God-given duty and it will be my honour to undertake that responsibility to the best of my ability, just like Prophet Muhammad saw.”

OBVIOUSLY the event’s reputation has superseded its

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young age, as many from outside the traditional Halal markets came in droves to capitalise from MIHAS. Kazakhstan for instance, the largest former Russian Republic territory better known as an energy producer, was keen on developing a Halal market for its seven million Muslim populations and MIHAS was a real eye opener on the potentials within the Halal industry. Visitors also got a peek into Kazakhstani culture with a unique Uygur tent displayed within their booth area as they won the Best Booth Award 2006. Iran also had a great sense of presence at MIHAS 2006 with an impressive array of locally-made goods, handicrafts and of course, Persian rugs. Colourful and exotic display was obviously Iran’s choice of design motive for their booth as it attracted large crowds over the five-day event. Holland too, represented by its Rotterdam Port Authority, was keen on becoming the preferred gateway for Halal products into Europe with its Halal Distripark. MIHAS fit their requirements for a well-attended event that attracted the exact group of people they were looking for – Halal businessmen. “I have never seen so many people so passionate and so sincere in their business undertakings and MIHAS has showed that to me, on so many occasions,” commented Capt. Kees Westrate from Port of Rotterdam. “I hope to come back again next year as I heard it will be even bigger. I can’t wait.”

the increased awareness of local Halal manufacturers, especially among bumiputera companies, in using MIHAS as a platform to promote their products and to enter the international market. A heightened sense for branding and packaging was also noted. “I am happy to see a 31 per cent increase in participation by bumiputera companies this year. They are using MIHAS 2006 as a platform to expand within the regional markets and enter the international market,” said Zakaria Kamarudin, Matrade’s director of services and product promotion. “Many also made great efforts to improve their labelling, packaging and

and Top Corridor and In-Yes Commerce (M) Sdn Bhd to establish a platform for the Halal industry. The third was between Mecca-Cola and Mofaz Dagang Sdn Bhd appointing the latter to distribute the popular soda drinks here in Malaysia. Among the Malaysianmade products that reported brisk sales were flavourings, spices and seasoning sauces, as well as beverages, organic food, frozen food, confectioneries, noodles, cocoa products, coffee and palm oil-based products. Perhaps MIHAS’ managing director, Shukri Abdullah summed it best when he said, “This is what we have set out to do right from the beginning, sharing of ideas and opening up new frontiers among Halal

THIS IS WHAT WE HAVE SET OUT TO DO RIGHT FROM THE BEGINNING, SHARING OF IDEAS AND “OPENING UP NEW FRONTIERS AMONG HALAL COMRADES. NOBODY CAN DO ANYTHING ALONE, PEOPLE

EVOLVE AND THIS CAMARADERIE AMONG INDUSTRY PLAYERS SIGNIFIES A GOOD MARKET EVOLUTION. “

For many local Halal manufacturers, MIHAS also provided more than just networking opportunities, it handed them international export markets on a silver platter through MATRADE’s business matching and trade facilitation programmes. Organised by its Services and Product Promotion Division, it managed to close nearly RM170 million worth of sales with China having the biggest trade buyer delegation with 41 representatives followed by South Africa with 17 and India with 16. Although the sales figure fell short of their RM200 million target, the event yielded many other intangible returns, including

advertisements to attract more potential customers and this to me, was a very positive sign.”

A TOTAL of three memorandums of understanding were signed during this year’s MIHAS, two were between the Islamic Dakwah Foundation of Malaysia

comrades. Nobody can do anything alone, people evolve and this camaraderie among industry players signifies a good market evolution. MIHAS have set the ideas in motion and Alhamdulillah, it has got people thinking about the endless possibilities within the Halal industry.”

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JAKIM’s Quest for-> MODERNISATION ->

Expect big things to come out from the Department of Islamic Development Words By Malaysia (JAKIM) within the coming years as the top echelons of the world’s KAMARUL AZNAM KAMARUZAMAN most credible Halal issuer are committed to an “open door” policy.

I

JAKIM @ ENSTEK

f the recent introduction of e-Halal is anything to go by, JAKIM is seen as stamping its authority to become not just a leading Halal certifier but also developing other value-added Halal applications and projects that could potentially lend more weight to their already internationally-recognised Halal logo. The e-Halal project, which allows the public to check the validity of JAKIM’s Halal certification via short messaging system (SMS) and through the Internet, was developed internally within just five months under the purview of its deputy director general (management), Haji Sumali bin Amat. The former Malaysian Administrative Modernisation and Management Planning Unit (MAMPU) director was instrumental in designing the e-government project to spearhead administrative modernisation and human resources planning within the Malaysian government. According to Haji Sumali, the e-Halal project is actually just a tip of the iceberg as far as modernisation within JAKIM is concerned. In a recent exclusive interview with The Halal Journal, Haji Sumali laid all his cards on the table to reveal a comprehensive plan for the world’s only government Halal certificate issuer. Beyond organisational and structural changes, he will also be looking at enhancing JAKIM’s core competencies within the global Halal industry, including:

[1] THE EXPANSION OF TOTAL STAFF FORCE BY 30 PER CENT 130 new posts have been created specifically for its new Halal Hub Division, formally known as the Islamic Food & Consumer Goods Research Division. Although a concise Halal hub masterplan has yet to be finalised, the additional staff will finally enable JAKIM to tackle thorny issues such as the illegal importation of meats into the country. Its officers will be stationed in four strategic port-of-entries, including Westport, Northport, Butterworth and Pasir Gudang. The new staff, comprising of religious officers, food technologists and scientists as well as management, will be screened by the government’s

recruitment agency - the Public Service Commission and is expected to be finalised by July. The technologists and scientists will be recruited via the Ministry of Health. [2] SETTING UP OF BRANCH OFFICE IN KUALA LUMPUR’S CITY CENTRE To tackle the complaints of Halal certification process taking longer than expected, JAKIM is setting up a branch office within the vicinity of Kuala Lumpur city centre by January 2007. An ICT-enabled centre will also be set up at the new branch office similar to that in Putrajaya to assist manufacturers and producers in completing applications for Halal certifications. Explaining that most delays in Halal applications

THIS WORLD-CLASS LAB WILL BE ABLE TO ANALYSE FOOD INGREDIENTS AND ADDITIVES, TACKLING COMPLEX ISSUES SUCH AS THE INSERTION OF ANIMAL AND HUMAN GENETICALLYMODIFIED ORGANISMS INTO FOOD PRODUCTS. IT WILL ALSO BE ABLE TO UTILISE GENETIC ENGINEERING EXPERTISE WITHIN FOOD PRODUCTION TO VERIFY FOR INSTANCE, WHETHER THE INGREDIENTS ARE FROM PROHIBITED ANIMALS.

are due to incomplete or missing supporting documents, Haji Sumali pointed that manufacturers will be assisted by facilitators who will ensure that a completed application can be submitted within just halfa-day or at most one day at these ICT centres. Due to be set up in KL by January 2007, the move should bring JAKIM closer to their clients. [3] ACCREDITATION OF JAKIM BY THE DEPARTMENT OF STANDARDS As part of the requirements under ISO Guide 65, JAKIM is planning to be accredited by the Malaysian Department of Standards in an effort to enhance JAKIM as a more credible body that would not only be in-charge of administering

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-> the MS1500:2004, but would also enable JAKIM to appoint more foreign agents internationally. [4] EMBARKING ON AWARENESS CAMPAIGN JAKIM will also initiate on a nationwide awareness campaign targeting the manufacturers as well as the public. The focus will be to create awareness on the benefits of obtaining a Halal certificate for manufacturers and to collect feedback on the problems facing manufacturers and what JAKIM can do to help alleviate those problems. Aside from producing a television program with RTM’s TV1, JAKIM will also conduct Halal seminars and workshops on a more regular basis beginning this year to better disseminate Halal-related info. On that note, JAKIM also plans to set a targeted timeframe to deliver their services “within the shortes possible time”. Haji Sumali made it clear that JAKIM’s service delivery records must be improved upon and measures to track their delivery will be put in place, including the implementation of Key Performance Indexes. [5] FORMATION OF RAKAN HALAL PROGRAM Rakan Halal (trans. Halal partners) refers to the strategic partnership between JAKIM and the many non governmental organisations (NGOs) in Malaysia to act as their “eyes and ears” within the domestic front. NGOs such as the Federation of Malaysian Consumer Association (FOMCA), Consumer Association of Penang (CAP) and Muslim Consumer Association of Malaysia (PPIM) would benefit most from this program since they produce findings regularly on suspected non-Halal products that carry JAKIM’s Halal logo. In this regard, JAKIM has setup a special task force to investigate these allegations and they welcome such efforts as it marks greater cooperation between them and the NGOs for the benefit of the ummah. [6] IMPROVING E-HALAL APPLICATION Since JAKIM based its e-Halal application on the global GS-1 barcode standard, the application

can potentially be extended overseas. Muslims in Japan for instance, can check and verify whether the Malaysian-made goods are actually Halal by SMSing the product’s barcode number to JAKIM. But they need help in implementing this from the relevant government agencies. Domestically, JAKIM is also looking to equip the e-Halal facility with interactive functions, including the reporting of fraudulent Halalcertified products back to JAKIM and possibly the Domestic Trade and Consumer Affairs Division. JAKIM is also concentrating on updating their Halal database and providing incentives to manufacturers to apply for the Halal certificate and a barcode from the Federation of Malaysian Manufacturers (FMM). In this regard, FMM has also agreed to reduce the fees for small and medium Halal industries. [7] THE SETTING UP OF HALAL CENTRE @ENSTEK In a significant move to elevate the local and regional Halal industry, JAKIM has purchased forty acres of land for the development of a one-stop Halal centre within TH Properties’ @enstek in Sepang. Scheduled to be operational by 2008, the centre will house special laboratories as its main component, catering to five types of biotechnological expertise that deals with meat, fat, oil, alcohol, chemical as well as personal-care products. The centre will also undertake plenty of Halal-related research and development work. This world-class lab will be able to analyse food ingredients and additives, tackling complex issues such as the insertion of animal and human genetically-modified organisms into food products. It will also be able to utilise genetic engineering expertise within food production to verify for instance, whether the ingredients are from prohibited animals. It will also analyse the technical aspects of food production such as Halal gelatine, rennet, even micro-level lubrication. Aside from Halal-related analysis, the labs will also conduct studies on the Islamic Shariah perspective of everyday living, such as the perfect

“HALAL HAS ENDLESS POSSIBILITIES, AND THERE ARE SO MANY PLAYERS WITHIN THE GOVERNMENT AND THE SOCIETY THAT CAN HELP CONTRIBUTE TO OUR CAUSE. THAT’S THE KIND OF SCENARIO WE AT JAKIM SHOULD UNDERSTAND. WE CANNOT ACT ALONE AND WE HAVE NO OTHER WAY BUT TO WORK TOGETHER,”

HJ SUMALI AMAT, DEPUTY DIRECTOR GENERAL (OPERATIONS), JAKIM.

diet according to Islam or even to provide scientific verification of everyday Sunnah by the Prophet Muhammad s.a.w. All in all, this JAKIM’s one-stop Halal Centre will be “doing what other people won’t be doing,” added Haji Sumali. [8] JAKIM’S NEW OPEN DOOR POLICY Central to all the modernisation efforts within JAKIM will be their “open door” policy. Haji Sumali realises that JAKIM’s own resources are very limited and the only way for the department to move forward is to leverage on the resources of other government agencies and private institutions to help realise their vision. “Halal has endless possibilities, and there are so many players within the government and the society that can help contribute to our cause. That’s the kind of scenario we at JAKIM should understand. We cannot act alone and we have no other way but to work together,” capped Haji Sumali.

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What is the Halal perspective of the world’s largest fast food giant? Read on to find out.

Words By KAMARUL AZNAM KAMARUZAMAN

McDonald’s take on Halal To what extent does the world’s largest fast food chain go when it comes to Halal? Let’s consider what they are dealing with in the first place.

M

cDonald’s delivers fast food meals to 50 million customers a day visiting over 30,000 restaurants in 120 countries around the world. Their Muslim consumer represents some 700 million people from a number of Muslim countries as well as countries with a sizable minority, including Singapore and South Africa. They also spend more than USD14 billion a year on farm produce worldwide, including 1.1 million metric tonnes of beef, 433 thousand metric tonnes of poultry and 1.4 million tonnes of French fries. From what was presented by Dr. Habib M’Nasria, McDonald’s quality assurance director for Middle East and Africa during the recent World Halal Forum, their commitment and understanding of Halal issues are quite staggering. Dr. Habib’s presentation at the Forum was based on studies of local legislation and standards, readings on Islamic food laws, discussions with suppliers and animal welfare authorities, as well as visits to many slaughterhouses and food processing plants around the world. HOW DOES A GIANT ENSURE HALAL COMPLIANCE?

First things first, McDonald’s does not own any of their suppliers. Their supply chain infrastructure consists of partners and exclusive suppliers who constantly strive for quality and continuity.

To qualify as a McDonald’s supplier, they must comply with global official standards as well as McDonald’s internal specification and policies, including product specification, food safety standards and farm biosecurity policies. In addition, they must also adhere to social responsibility policies on aspects concerning animal welfare, animal feed, as well as prohibition of deforestation, and prohibition on the use of antibiotics as growth promoters, and Halal. To verify that these standards are in fact being adhered to, the fast food giant through their specialists from the International Quality Centres regularly conducts announced and unannounced visits. An annual due diligence of HACCP, treaceability and biosecurity systems by independent third party auditors are also regularly carried out. It terms of social responsibility compliance, McDonald���s conducts an animal welfare due diligence as well as a Halal due diligence process, whereby suppliers who has been through the verification process are then assigned a specific number and are listed in McDonald’s database of approved suppliers, subject to a

yearly reinstatement or delisting. Additionally, to be approved as a McDonald’s Halal supplier, the companies must also comply with McDonald’s own set of Halal requirements. Due to their commitment to social responsibility, McDonald’s does not buy just commodities. They in fact buy a value-added product. “Halal is very simple, but the actual practice of Halal is very varied,” said Dr. Habib. The following are just some of the issues being confronted by the global fast food giant in ensuring that their meals are Halal. What follows are the challenges McDonald’s faces with Halal compliance, and their own position regarding Halal.

MCDONALD’S HALAL CHALLENGES

Modern manufacturing requirements for production line speed, especially with the introduction of mechanical slaughter for chickens. Animal welfare issues, including the animal rights group demanding the use of stunning to avoid inflicting pain to the animal, but Halal requires that the animal to stay alive at the moment of slaughter to ensure maximum blood drainage. “The challenge is to find a method that satisfies both,” said Dr. Habib. Differing practices of Muslim Halal organisations in the exporting countries also makes it hard for McDonald’s to comply. They include: > Pneumatic Percussion Stunner: not allowed in the Middle East, but allowed in Malaysia, which requires that the stunned animal would be able to recover to its normal state within five minutes in addition to a strict control of skull breakage.

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> Electrical Stunner for Poultry: a number of Muslim countries, including Egypt, Pakistan, and Saudi Arabia do not allow this. Malaysia permits non-lethal low current electrical stunners, which is subject to specific ‘amperage’ and ‘residence time’. > Mechanical Slaughter for Chickens: most Muslim countries do not allow it since it takes away the intention and the act of individual prayer on individual birds, and the method requires that the birds are to be deep stunned, which also poses a high risk of death prior to slaughtering. Malaysia allows mechanical slaughter for chickens, but the current standard attaches a number of conditions governing the prayer and the supervision by a Muslim slaughterman of the spinner blades. Despite this however, JAKIM noted that this is not practiced anywhere in Malaysia and that they have not approved any plant to use this method outside of Malaysia for import purposes. The coming revision of MS1500:2004 will probably see this allowance taken out. Animal feed for cattle is another area where Halal rules are being challenged. Much has since been uncovered after the last Mad Cow Disease crisis according to Dr. Habib.

MCDONALD’S HALAL RECOMMENDATIONS

The issue of not uttering prayer on every individual bird because of the speed of the production

“Halal looks pretty simple; it is indeed very simple, but the practice of it is very wide.” DR. HABIB M’NASRIA

line is easily resolved by adding more slaughterman (without having to slow down the speed of the production line). On the issue of stunning, McDonald’s calls for more research to be done in this area by credible Muslim scholars, scientists and legislators. Dr. Habib posed a few interesting questions with regards to stunning (see accompanying story on stunning). -> When pneumatic stunning is not allowed, Dr. Temple Grandin, a designer of livestock handling facilities and an Associate Professor of Animal Science at Colorado State University, USA recommends: [1] Proper restrain box to hold the animals in a comfortable standing position equipped with chin lifters. This is the best practice. [2] If the box is used, humane treatment must apply at all times, including: i. Vocalisation: 5% maximum ii. Falling down: 1% maximum iii. Animals must not have wait in the restrainers boxes before slaughter iv. It is crucial to have an evaluation on the effectiveness of Muslim slaughterer; animals must collapse almost immediately. v. If a turning box is to be used, it must pass the above scores, it has to fully support the body of the animal, be adjustable to different size animals and it should not make the

MCDONALD’S HALAL QUESTIONS TO THE MUSLIM WORLD:

IS STUNNING HALAL?

In determining whether stunning is permissible in Islam, Dr. Habib urged Muslim scholars, scientists and legislators to undertake a thorough research in this area. He posed several provocative questions on the rationale of using stunning as an acceptable Halal practice. The following are some questions posed by McDonald’s:

Stunning for Cattle

01. Can stunning be compared to ( ), which is the act of reaching and cutting the spinal cord during slaughter (i.e. cutting the head completely in one act of slaughter, which is considered Haram by many. Some Kosher practitioners would cut the neck from the back right after slaughter to stop the animal from moving and speed up production.) 02. What is the effect of stunning on blood profusion, how long does it takes for an animal to die with and without stunning? The Hadith simulates blood profusion to a running river (the words profusion and river came from the same root word). 03. Has any microbiologist studied the effect of stunning on micro flora? 04. Are food safety, Halal and animal welfare not compatible? Is the act of Halal slaughter without stunning inhumane? Grandin reported, “It is believed that animals do not feel that their throats are being cut if it is done quickly by a razor blade sharp knife.” 05. How much is stunning being driven by cost and factory’s demand for productivity instead of animal welfare? 06. Modern production lines are not built to take Halal into account. Therefore, how much are Muslims willing to pay for the proper setup to get proper Halal meats? How about two or three restrainer boxes in parallel feeding the same line to preserve current level of industrial productivity? This obviously comes at an extra cost. For this to take place, Muslim customers should demand and pay for it. As this is a Halal added-value, not a commodity, will producers use this as a competitive advantage to get more Halal business? 07. Is it acceptable to stun immediately after rather than before slaughter with or without delay? How long is the delay? There is a need for a scientific and Halal perspective.

Stunning for Poultry

01. Dr. Habib urged Halal certification bodies to find an alternative stunning method that does not kill the chicken before Halal slaughter. Lately, he has heard of head only dry electrical stunning for chicken but is not aware of any commercial applications as yet (to be researched more). 02. He also urged relevant bodies to come up with a proposal for a poultry restrainer box. The industry needs engineers to invent a chicken restrainer box - a principle which works much like the cone used by wet market traders in many Muslim countries. These cones need to be adapted to the bleed rail to uphold the required level of productivity. Dr. Habib hopes that these questions are addressed by a credible Halal organisation residing under a large Muslim body such as the OIC or a Halal Standards body of the Muslim World League. Until a decision is reached, McDonald’s will continue to use stunning or at least restrainer boxes to ensure that slaughtering is done in a controlled and humane manner. THE HALAL JOURNAL

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Humane Justifications

Halal = Animal Welfare animal slip during turning. This would mean using a lot of hydraulics and would be very costly to produce, probably ten times more than a normal standing box. vi. Knives used need to be of the straight type and be twice the width of the animal’s neck’s. vii. Prohibitions: hoisting, dragging, hanging of live animals, devil claw etc. [3] Head only electrical stunning for cattle. [4] It is also interesting to note that some Muslim scholars have given Islamic jurisprudences to allow slaughtermen operating manually not to utter the prayer on every individual bird because of the speed of the production line.

MCDONALD’S OWN HALAL POSITION

Pithing, captive bolts and mushroom stunners are not allowed in McDonald’s. As for the issue of stunning, until the existing issues are resolved, McDonald’s will continue to use stunning, or at least restrainer boxes, to ensure that Halal slaughtering is done within a controlled manner.

With the increasing potential for globalisation within the Halal food industry, Halal slaughtering has to contend with arguments in favour of stunning as the more humane method of slaughtering. Dr. Habib argues that Halal slaughter is actually based upon the concept of mercy for the animals. He puts forward the following justifications: The Hadith states, “Allah has ordained excellence on everything; if slaughtering is to be done, do it in the best manner by sharpening the knife and putting the animal to rest,” (literally: put the animal at ease). The animals are to be taken to the slaughter house with kindness; instructions are called against pulling the animal’s ears, legs and so on. One should propose water to the animal before slaughter. Animals are not to be shown the knives being sharpened. Live animals must not see other animals being slaughtered, i.e. Halal goes beyond being merciful to the mere body of the animal. It also considers its soul. No organs or parts of the body are to be cut from live animals. Any piece cut from a live animal is considered carrion (Haram). Drawing blood from animals for use in food and drink is Haram (a pre-Islamic practice in Arabia). Knives must be kept sharp at all times. Slaughtering is to be done correctly and quickly to bring about a fast death of the animal. No dressing is to take place until the animals are cold, i.e. motionless (animals should not be taken out of the restrainer boxes or hang on the bleed rail until their completely dead). Similarly, chickens should not be put through scalding until they are completely dead. Do not expedite (rush) the souls” - Hadith McDonald’s only require “vegetarian cows” and tallow is also disallowed for Halal, although some scholars may allow it on the basis that it is similar to Jallafa, and that it is acceptable, provided there is a two-week withdrawal period prior to slaughter (according to Dr. Habib, this needs more research).

McDonald’s only requires hand slaughtering. Mechanical slaughter is not allowed. Prayer must be pronounced on each individual bird, on the basis that this is the position of the majority of the schools of thoughts based on their interpretation of the Quranic verse which reads, “And eat not of that whereon Allah’s Name hath not been mentioned, for lo! it is abomination…” (The Quran: VI – 122). McDonald’s position on animal feed is straight forward - no animal parts are to be fed to their cows, except for tallow which is still a practice in Australia and New Zealand (for non Halal meats).

“McDonald’s does not allow pithing, captive bolt and mushroom stunner.”

The same goes for Halal poultry - no cannibalism, including its feather. No part of any animal is allowed except for fish-based meals, although UAE and Saudi Arabia allow for the use of offal / feather meal provided it comes from a Halal slaughterhouse and processed in a Halal rendering plant, which is quite difficult and very expensive to undertake. Therefore, with the exception of fish meal, McDonald’s requires only “vegetarian chickens” and they go beyond local legislations in this instance. hj

NOTE: For a detailed version of Dr. Habib’s presentation, please log on to www. worldhalalforum.org. This function is available only for a limited time, so hurry!

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THE HALAL MARKET MOVEMENT

WHERE IS THE HALAL MARKET HEADING? WE SEE IT MOVING IN FOUR DIRECTIONS. HERE ARE EXCERPTS FROM THE REVISED KASEHDIA PRESENTATION AT THE WORLD HALAL FORUM IN MAY.

O

ver the last two years, there have been extraordinary developments happening in various parts of the world. One of the proofs of this development was the content and participants of the World Halal Forum in May. The international event saw active participation from senior representatives from some of the world’s major corporations covering the full spectrum of the Halal industry value chain. Among them were the world’s largest food manufacturing corporation (Nestle), the world’s leading restaurant chain (McDonalds), the world’s number one and number two retail chains (Tesco and Carrefour), Europe’s largest and the world’s third largest port (Port of Rotterdam), one of South East Asia’s top 10 ports (Westports), the world’s second biggest shipping company (MISC), South East Asia’s biggest investment bank (CIMB), India’s biggest meat exporter (Allanasons), world’s number one supplier of Halal airline food (LSG-Sky Chefs-Brahims) and UAE’s leading Halal food producer (Al Islami). In addition, the WHF had some of the Halal industry’s pioneers from around the world in the fields of food production, Halal science, certification, product security, Halal animal feeds, branding and media. The participant list is in itself an eloquent statement of the start of the coming of age of the Halal industry. The past two years have seen a dramatic increase in the profile and focus of the Halal market, and this trend is expected to continue and develop over the coming years. HALAL MARKETS From a market perspective, the traditional major target markets remain in Asia. However, there are influential developing Halal markets in the UK, Europe and the USA with significant market size. The developing Halal markets of Europe and the US play an interesting role, because they are markets that also play defining roles in other markets around the world. As the dynamics within the Muslim world change, and globalisation trends continue to shape people’s tastes, habit and spending patterns across the world, we are likely to see moves in the developing Halal markets having increasingly influential roles in the established markets of the Middle East and Asia. In terms of Halal product, a leading player in the Halal market said recently, “You need a good product, proper certification, and the rest is marketing.” Marketing Halal on its unique benefits and qualities has not even started. Like Islamic banking, Halal products have been targeted primarily, and naturally, at the Muslim

REGION 2005 MUSLIM POP PER CAPITA FOOD HALAL FOOD MARKET Region Value

2005 Muslim Population

Per capita food Halal Food expenditure Market p/a USD Millions USD

Africa West Asia South Central Asia South East Asia China Europe (inc Russia) N. America S. America Oceania

461.77m 195m 584.8m 266.37m 39.1m 51.19m 8.26m 1.64m .35m

250 570 300 350 175 1,250 1,750 500 1,500

Total

1,565m

115,443 111,150 175,440 93,230 5,865 63,988 14,455 820 525 US$ 580,915

Source: www.islamicpopulation.com, Euromonitor

consumer. But, as we are all continuing to discover, the appeal of Halal is widespread; it has universal appeal; Halal stands on its own merits; merits which, as we speak now, have hardly begun to be utilised and realised from a marketing perspective. Take a look at the Halal’s market neighbours. Market values such as healthy, organic, natural, environmentally friendly, non-cruelty to animals, ethnic, fair trade and even kosher have all established their place on the retail shelves as value-added marketing propositions. Halal is at home among these values. Halal overlaps these values, even encompasses these values. Halal, in its real meaning, is still waiting to be discovered. MARKET NEIGHBOURS Halal product offerings are still very limited. A look at the American

kosher market will give us some idea of how Halal can develop as it becomes more mainstream. The US kosher market, with a Jewish population of 5 to 6 million, has been valued in excess of 100 billion USD annually. There is a range of 86,000 certified kosher products on the supermarket shelves. However, in Mintel’s recent survey in the US shows that only 15 per cent of the kosher product customers are Jewish. Fifty five per cent buy kosher because it is perceived to be healthier, 38 per cent are vegetarian, 24 per cent want dairy-free, and 16 per cent are Muslim. This means there are more Muslims than Jews buying kosher products in the US because there are only 1,000 Halal certified products available, and most are not available through the mainstream retail outlets.

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Needless to say, the supermarkets and food retailers have taken note of this, hence the increased focus on Halal. The key to success is likely to be based on consistency, quality, recognised standards and certification. In Europe, Halal remains almost exclusively in the realm of the neighbourhood convenience stores that used to be owned and run by British, French and German families, but are now owned and run by Pakistani, Moroccan and Turkish families. They are selling Halal products to the 30 million Muslims in Western Europe, with a combined purchasing

more a complete range of product offering in supermarkets chains worldwide, as well as in 5-star hotels and restaurants and fast food chains, airline meals, school dinners, military and even prison rations. We see this phenomena applying not only on food items. Personal hygiene and healthcare products, toiletries and cosmetics are all appearing as Halal options. Once Halal is understood as a lifestyle choice, the range of option increases exponentially. So the question naturally arises, where to find Halal certified products? Because most of the Muslim majority countries do not consider

efficiency in the certification process. Because with the movement of Halal products around the world, the increase in awareness of Halal in general, and in turn the added value surrounding Halal, and of the holistic and interdependence of the entire Halal value chain, we are seeing entirely new sectors emerging, relating to Halal logistics, security, auditing and industrial development. With major investment in Halal production and manufacture at one end of the chain, and major investment in the retail sector at the other end, maintaining the integrity of the Halal chain at all

chain will be created. All of this growth will require more comprehensive standards, to cover all of the stages from the farm to the fork, not just by general guidelines, but in a manner that will enable Halal to emerge as an ISO-compatible standard with independent, transparent industry-compatible auditing procedures, that will in turn enable more Halal certified products to fill the shelves to meet the global demand. We see a secure, verifiable, traceable Halal supplychain is in the near future. Halal is on the move. It is being reborn into the age of globalisation, and

The focus is on South East Asia, where you can walk into supermarket and find the widest variety of Halal certified products. The multi-cultural nature of the populations has made Halal certification a much more important issue. power, in food alone, of some 45 billion Euros annually. The UK can provide us with a snapshot of the wider European picture. Ethnic (read Muslim) populations are growing at 15 per cent, as against a national average of 1 per cent. In 2011 half the London boroughs will have ethnic majorities. Supermarkets are currently getting 0.5 per cent of the Halal meat market, although 100 per cent of the Muslim population use the major supermarket chains. GOING GLOBAL Globalisation has brought with it a cross-pollination of cultures and tastes. European consumers are looking for ethnic foods. Asians have increasingly Westernised tastes. Halal is more and

Halal-certification necessary -or have not done till now- they cannot provide Halal certified products to the international markets. Hence the focus is on South East Asia, where you can walk into supermarket and find the widest variety of Halal certified products. The multi-cultural nature of the populations has made Halal certification a much more important issue. Singapore, Thailand, Indonesia and Malaysia make up the ‘big four’ in terms of Halal certified product offers. The topic relating to Halal standards, auditing and certification is a huge one that needs to be resolved by the relevant parties. But as far as industry is concerned, there is a need for an increase in speed and

points in between is becoming increasingly important. The Halal integrity in the handling, storage, warehousing, and transportation by road, sea and air of Halal certified products, and also dedicated Halalcertified zones are fast becoming a reality. The involvement of the seaports and shipping company in this Forum is in itself a comprehensive statement about the growth of Halal Logistics, and I myself look forward to hearing from them all tomorrow. The creation of controlled Halal-only industrial food parks, free zones, DistriParks will be part of the future of this Halal industry. As the market demand continues to increase, more links in the supply

indeed, globalisation suits the nature and quality of Halal. Halal is made to be global. Halal is for everyone. The potential market for Halal certified products is actually 6 billion people. We see Halal is moving in four directions- it is becoming more Upmarket, Mainstream, as a Standard and as a Global Lifestyle Brand. These movements and developments of the Halal market and the realisation of the true meaning of the concept of Halal itself will be not without challenges and problems. A key challenge is the harmonisation of all the Halal certifications around the world and the Muslims must provide the direction hj for all to follow.

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fast track | ASIA

Indonesia

A Need for One Halal Logo?

The Halal Journal was in Jakarta recently and found a diverse nation with massive potentials within the global Halal industry. One key element however was missing – a common Halal logo. Kamarul Aznam reports. REPRESENTING the small group of locals at the inaugural Halal Indonesia Expo 2006 held recently was Darsono Arbi, a middle aged kampong manufacturer of multicoloured frozen doughnuts. Picking up one of his cardboard boxes of doughnuts peering through a transparent plastic window, his packaging simply had the brand name, contact details and the word Halal written in Arabic. Curiously though, other packaging from other local manufacturers had both the Arabic and Latin inscriptions as a Halal logo. Like Darsono’s multi-coloured frozen doughnuts, Indonesian Halal logo may also come in many different styles, shapes and colour - it is up to the manufacturer’s discretion. “That’s what you get when the certifying body is not the government, even if it’s the only Halal certification body in this country,” he said with a wry smile. Similar in Malaysia, obtaining Halal certificates is voluntary in Indonesia. Unlike in Malaysia however, a Halal certificate issued by Majelis Ulama Indonesia (MUI), the de facto Muslim organisation in Indonesia, does not automatically come with a Halal logo – one simply does not exist.

When Indonesians discovered swine-based enzymes in foods in 1989, MUI realised it was time for them to create a Halal specialist body within its organisation. A few months later, the Assessment Institute of Foods, Drugs and Cosmetics or LPPOM was established as a non profit organisation. “The sole objective why LPPOM came to be has always been to try and find ways to increase the level of confidence and trust of the ummah when they consume any Halal products available here in Indonesia,” said Osmena Gunawan, treasurer of MUI on the sidelines of Halal Indonesia 2006. Although they were initially tasked to assist MUI in promulgating policies, rules, recommendations

and counselling, LPPOM quickly started scrutinising, analysing and certifying all local and imported Halal products. Throughout the following years, it had successfully positioned itself as a professional and credible Halal certifier despite not getting much support from the government, funds notwithstanding. MUI’s Halal certificate however is a pre-requisite for the application to the government to market and distribute Halal products in Indonesia, which currently falls under the purview of the Food and Drug Control Agency (BPOM). It was previously under the Ministry of Health and Social Welfare but it underwent a structural re-organisation to become an independent body to act more like the US

hj

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Food and Drug Agency and is now under the direct purview of the President of the Republic of Indonesia. Darsono also pointed out that there were previously two models of Halal certification in Indonesia – MUI’s and BPOM’s. Following the re-organisation, the latter relinquished all of its Halal jurisdictions and handed them over to MUI’s Fatwa Council, all except the regulation and enforcement of Halal products. Under the new process, once manufacturers have obtained their Halal certification from LPPOM-MUI, they would then have to register with BPOM to enable them to market their products as Halal. Although the service is free, “that is only in theory,” said Andi, an official from a leading beverage manufacturer. “It could take as quick as one week and as long as three months, depending on…you know what I’m talking about,” he said suggestively. Having issued with MUI’s Halal certificate and cleared by BPOM to market their products, manufacturers may opt to put on their packaging with what has been adopted as a universal Halal logo – a circle with the word Halal in Arabic. They may also opt to use a different design. “The government has declared that it is not compulsory because it adds more cost to the manufacturers,” said Andi, “but more are beginning to realise the importance of a Halal logo to the consumers.” As mentioned, enforcement of Halal is still under the purview of BPOM, and since there is no one common logo, enforcement can be a bit tricky. It is therefore not surprising that there have been many cases of frauds, including using expired Halal certificates, declaring the entire range of products as Halal even though only one is certified and using a Halal logo without any Halal certificates. The latest and by far the biggest public outcry was in October 2000 when three Japanese and four Indonesian officials from PT Ajinomoto Indonesia were arrested for using pork enzymes in their popular MSG flavour enhancers. “High profile cases such as these deepen the consumer’s mistrust of the manufacturers,” said a Malaysian businessman familiar with trading in Indonesia, “and in a society that has a serious divide between the rich and the poor, Halal is also being used as a tool to boycott products and the staging of street demos,” he added. Many would agree that cases like these are serious public relations nightmares and it should be the last thing on any manufacturer’s mind. They could also easily undo all efforts to build Halal certification awareness amongst manufacturers, especially with the small and medium sized industries that make up the majority of Indonesian retail segment, some estimating as significant as 70 per cent. There

Halal Indonesia Expo 2006

The inaugural Halal Indonesia Expo held from April 27 – 29 brought together 300 local and international Halal manufacturers from 17 countries keen on tapping the potentials within the world’s largest Muslim nation. Organised by the Exhibitions Promotion and Management (M) Sdn Bhd (EXPAM) and endorsed by Majelis Ulama Indonesia (MUI), the event was held at the Bidakara Convention Centre in downtown Jakarta. Aside from the usual food-related booths, other segments of Halal was also represented including Islamic fashion, banking and finance, cosmetics and pharmaceuticals, food research and development, Islamic arts and crafts as well as franchising. MUI held seminars on Halal certification and the organisers also held talks and discussions at the main hall. The three-day event not only provided a glimpse into the current Halal industry scenario in Indonesia, it also gave a good taste of the shifting market perception and awareness on the benefits of Halal within Indonesia.

was also the cost factor. “Small manufactures like me often find ourselves in a dilemma,” said Herlina, a local manufacturer of roasted bananas who is still unsure of the branding benefits of Halal in Indonesia. “We want to tell consumers that our products are Halal, but because of these cases, the consumers have grown wary of the current Halal logo. And to get a Halal certificate is not cheap.” Applying for a Halal certificate would cost manufacturers around Rp1 million (RM500) per product. As it is, a source from MUI estimates that only 20 per cent of the total processed foods available in Indonesia are

actually Halal certified. “Until we don’t have to bring the entire directory of Halal certified products when we go shopping for groceries, just enough by looking for products that carry one standard Halal logo, that would be good enough,” said Nur Bowo of Halal Watch, one of the local Halal-centric NGOs. Despite the many obscurities however, there have been strong sentiments within these last few months by Indonesian Halal authorities to establish a common Halal logo for the convenience of all. How long more the consumers have to wait for this to be created, however, remains unclear.

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fast track | ASIA The Philippines ambassador to Indonesia, His Excellency Shulan Primavera reiterates his government’s support for the global Halal industry and revealed the measures currently undertaken by his government for Halal to develop in Philippines.

Philippines to reorganise itself for Halal

His Excellency Shulan Primavera (left) discussing with a Philippines official at the recent Halal Indonesia Expo.

ACKNOWLEDGING the importance of Halal and the role it could play in increasing the level of cooperation within the South East Asian region, Philippines ambassador to Indonesia, His Excellency Shulan Primavera pointed out that his government is in a process of re-organisation to tap the wealth within this industry. He said this at the sidelines of the inaugural Halal Indonesia Expo in Jakarta. One of the first steps according to him is to identify which department is responsible for this lucrative industry. “Mechanisms are currently being devised to ensure that there are close coordination among government agencies that are involved in this particular Halal industry,” said Shulan. “One is to determine which government agencies that should have the final coordinative power on very simple questions such as the authority to issue Halal certification.” “In the Philippines, such government agencies could either be the Ministry of Trade, the Office of Muslim Affairs, or even the Department of Agriculture. I mean, there are (steps to coordinate within), but we are definitely doing this within the objective of coordinating a one-stop shop principle. This question is currently being addressed by the government.”

“We can seek the untapped deposits of rich Middle Eastern people. Instead by being deposited in European and American countries, perhaps they can be invested here in South East Asia. “ In addition to the reorganisation, Philippines are also hoping for more technical support from its predominantly Muslim neighbours, each with its own Halal-related expertise. In this regard, some progress have actually been made, with reports earlier in June highlighted news about JAKIM pledging technical assistance to the Autonomous Region of Muslim Mindanao (ARMM)

in Halal certification standards, which will then formulate the country’s first Halal Certification Board. “With respect to Brunei, Indonesia, Malaysia and the Philippines, we have one vehicle to promote this, which is the Brunei, Indonesia, Malaysia and the Philippines East Asian Growth Area (BIMP-EAGA). The four countries are also members of Asean, which is of course to promote trade, investment and tourism within the expanded Asean region. With respect to Halal products, these four regional areas can readily serve as a catalyst for the global Halal industry,” he added. ARMM is also the site of the BIMP-EAGA Poultry Project undertaken by traders within the group which aims to export Halal chickens to West Asia. The project would be set up in a 20-hectare facility inside the ARMM Regional Economic Zone Authority in Polloc, Maguindanao and it would enable Mindanao to independently export Halal-certified products to the affluent West Asian region. Aside from rearing of Halal livestock, Islamic banking and finance could potentially be another area worth capitalising on, especially with reports of shifting investment trends by wealthy West Asian investors. “Now there is a great potential for Halal products. It is a market I think which has been neglected for quite some time. In fact, beyond Halal food products, there are also tremendous interests in Islamic banking,” said Shulan. “We can seek the untapped deposits of rich Middle Eastern people. Instead by being deposited in European and American countries, perhaps they can be invested here in South East Asia. So that’s another area, where Brunei, Indonesia and Malaysia could extend support to and develop and generate cooperation among each other,” he added. He also acknowledged that the Halal industry could thrive within its six million Muslim populations by pointing out several key target markets that could be tapped into. “One initial market that can be targeted is of course the Autonomous Region of Mindanao in southern Philippines,” he said. “Ultimately, another market that would be worth tapping is the Middle Eastern countries, where there are large concentrations of Filipinos working there, and that by itself can be an important market for Philippines’ Halal products.”

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fast track | AUSTRALASIA

Beyond Cattle and Sheep

The Islamic Education and Finance Industries in Australia BY ZULFIKAR M. SHARIFF

THE LAND of cattle and sheep. That is how the Australian Halal industry seems to be perceived by non Australians. True, New Zealand is better known for sheep (or at least for Australians), but whenever the Halal industry is discussed outside of Australia, the most common interest is in Australian meat. Australia does produce quality meat products. With the keenness of the abattoirs to meet Islamic requirements and the non shortage of Halal certifying bodies in Australia (18 bodies at last count) Halal meat is easily obtainable. Melbourne, a multicultural city of five million and regularly rated as the world’s most liveable city, is also home to more than 100,000 Muslims. Halal butchery is always a short drive away and Sydney Road, the road that links Melbourne to Sydney, albeit almost 900km away, is scattered with Turkish kebab shops, Lebanese grocers and several major butcheries. The signboard for Medina Halal meat, one of the most popular Halal butchery in Australia, can easily be seen amidst others notifying potential customers of Persian rugs and Harley Davidson motorcycles. However, meat is not all that the Halal industry or even Muslims in Australia has to offer. While the Muslim population is slowly increasing, the Islamic market is expanding in leaps. Two important emerging industries are education and finance. Education is an important industry in Australia. With quality universities like University of Melbourne, Monash University, Australia National University and with more than 230,000 international students from about 195 countries, the education industry is fast recognised as valuable and vital. Malaysia alone sends 19,500 students to Australian tertiary institutions. The emerging Australian education industry is not just confined to tertiary education however. Islamic education in Australia is fast growing with more than 20 Islamic colleges around the country. Still in its nascent stage, with most Islamic colleges established only in the 1990s, the growth and its engagement with the wider society and government makes Australian Islamic colleges an excellent platform for students who want to study in Australia and yet retain their Islamic identity. Islamic Colleges follow the state-sanctioned curriculum with Islamic subjects included as part of the curriculum. Mr Selim Kayikci, vice principal of Ilim College said, “Ilim College provides an Islamic environment that encourages high

The emerging Australian education industry is not just confined to tertiary education however. Islamic education in Australia is fast growing with more than 20 Islamic colleges around the country. achievement and focused ambition and equips students with enough knowledge and confidence to put Islamic beliefs, values and morals into practice in their own lives.” Islamic colleges provide a strong foundation for students to enrol in Australian universities. By the time students enrol in university, their command of English, knowledge of culture and the educational system will be well established. Bridging the divide between Islam and the West, graduates of Islamic colleges in Australia will gain greater appreciation living as Muslims in an Islamic environment within a Western country. The bridging of the Islam-Western divide is done on various scales in Australia. Apart from the various community-government and multicultural organisations that seek to improve relations, the government’s continued appreciation of Islamic finance as an industry provides a stronger platform for the continuous mutual respect and understanding between the cultures. One example of the respect accorded

to Muslims is the relative ease with which the Muslim Community Cooperative (Australia) Ltd (MCCA), Australia’s largest Islamic finance and investment organisation engaged with the Victorian government for the exemption of double stamp duty. Founded in 1989 with an initial capital of a little more than AU$20,000, MCCA initially started by providing Murabaha and Musharakah type house financing to the Muslim community. However, given the need for assets to be transacted in both systems, MCCA clientele has to pay stamp duty in multiples when the property is first purchased by MCCA and sold at the end of the contract. However, when the team led by Dr Abdul Rahim Ghouse, General Manager of MCCA met with the Victorian State Revenue Office (SRO) in October 2003 and in subsequent meetings, they found that SRO is not only tolerant of Muslim needs, but is also appreciative of the development of Islamic financing. As a result, within just one year since the initial meeting, the Victorian government gave bipartisan support to the tax amendment to exempt payment of double stamp duty in Shariah compliant financing with Royal Assent granted on 19th October 2004. MCCA then proceeded to engage the Office of State Revenue in New South Wales and has been given a waiver for Murabaha financing from double stamp duty. During The World Halal Forum in May, it was illuminating to see how much Muslims in Australia were able to engage on equal footing with the federal and state governments. While Muslims in THE HALAL JOURNAL

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fast track | AUSTRALASIA (from page 45)

other Western countries detailed their difficulties in gaining recognition for Islamic financing, MCCA has been able to not just encourage the state government to amend the Tax Act, but was able to work with the regulators on various levels. MCCA also engaged with the Uniform Consumer Credit Code Management Committee, the organisation that governs consumer-financing organisation relationship, to exempt Islamic financing from using the word “interest”. These recognitions of Islamic requirements reflect the openness from both sides - the Muslim community and the government - to not only engage, but work out mutually beneficial solutions. As a result, Australia is now able to provide financing products that suits Islamic requirements. And as a consequence, it allows organisations such as MCCA to develop more products that complies with both Australian and Islamic laws. As an example, MCCA is launching in July 2006, the Crescent Ethical Managed Discretionary Account (Crescent Ethical MDA), an investment product that allows investors to invest in the Australian Stock Exchange (ASX) through Shariah screened shares. It attracts investments from Muslims internationally who want to invest in the strong Australian market but requires it to be done according to Shariah requirements. In the next few months, MCCA is launching several other investment products to attract greater investment, which will not only benefit the Muslim community, but also Australia as a whole. While the cattle and sheep market has dominated discussions about the Halal industry in Australia, the education and Islamic finance industries are emerging to provide greater avenues for development of the Halal industry in Australia while serving the international Muslim market.

John Dorian (centre in pink shirts) at the recent WHF.

JUST MAKE IT CLEAR FOR US

The Australian Meat Council on thoracic sticking for Halal WHILE several World Halal Forum speakers have raised concerns over the current practice of thoracic sticking as part of Shariah acceptable method of slaughter by non Muslim meat producers, a representative of the Australian abattoirs, John Dorian from the Australian Meat Council has stood up and explained to everybody why this issue shouldn’t actually be in the forum’s agenda, nor should it be in any other discussions because it is actually a non issue. Thoracic sticking, which is the act of cutting major blood vessels that exits from the cattle’s heart, i.e. the thorax, to allow the carcass to completely bleed out, only occurs when the animal is completely dead. There are several signs that the man on the production line looks out for before announcing the animal is dead, such as the absence of eye reflexes or a placid tongue. “The aorta gives off major blood vessels which supply blood to the head. These vessels are very strong and muscular to maintain a continuous supply of oxygen and nutrients to the brain. During the Islamic slaughter, these vessels are severed and have a tendency to contract, restricting flow of blood,” Dorian explained. According to him, although blood flow still occurs, the animal is already dead and although the blood flow stops, there is still a small amount left, maybe one to two litres out of a total of four to five gallons in the cattle. When the aorta is restricted, blood cannot flow out with ease leaving behind some residue. “Complete drainage of the vessels is necessary because when a significant amount of blood is left behind, it affects the taste, the texture and shortens the shelf life. It makes the meat very gamey, very strongly flavoured. So

the aim is to completely drain the blood from the carcass,” he added. This is normally done outside the twominute window allowed by JAKIM and depending on the design of the production plant, it could be as long as five minutes. If for some reason the slaughtering was not performed correctly, for instance the animal moved during the slaughter ritual, the act of doing a thoracic stick makes sure the animal does not regain consciousness. This will also make sure that there are no concerns from animal welfare groups. “But you must realise that this is not a concern for Halal because the carcass would already have been declared as non Halal by the Muslim slaughtermen and by the Muslim checker, the one who ensures if that procedure was carried out properly. In fact, if the two somehow failed to realise that the animal is not Halal, there will be another roving person that moves around on the floor to say that it is not Halal. Therefore, the whole issue of thoracic sticking is actually a non issue,” said Dorian. “You must understand, it’s not in Australia’s interest to not meet the market needs. Australia is not an Islamic country, so we rely on the buying country to tell us what the requirements are. I may not know, and our government’s Australian Quarantine Inspection Services, which is synonymous to your Department of Veterinary Services, may not know what the requirements are. Islamic certifiers are actually the experts that should advise us. In the past, countries have had different views of what is Halal and what is not, and it was not spelled out clearly enough for us. If the importing countries specify what the requirements are, Australia as the exporting country will readily meet their requirements,” he added.

46 THE HALAL JOURNAL

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fast track | AFRICA

The Namibian-South African

Halal Trade Scenario

A particular Halal certifying organisation from South Africa is certifying Namibian Halal manufacturers by issuing “threats” that their products will not enter South Africa if they do not use their South African Halal certification.

THIS CLAIM was disclosed by Ahmed Mohammed of the Namibia Halaal Trust (NHT) to The Halal Journal recently. Without naming which South African certification body, Ahmed said that it had so far influenced two Namibian companies which had significant controls within the Namibian market. “To me, this is wrong. Let the South African organisations control South Africa, Namibian organisations control Namibia, JAKIM control Malaysia and so on. Because Namibia Halaal Trust operates under the system that every cent we make will go back into the community. If the money goes to another organisation outside of Namibia, it will not benefit the local or regional Muslim community, only this organisation alone,” Ahmed said. With a Muslim population of about 3,000 people, expatriates makes up the majority of the Muslims in Namibia while local indigenous people total about 400. One of Namibia’s main sources of revenue is cattle rearing and their biggest markets are South Africa, Europe and other African nations. This domineering attitude of South Africa towards Namibia isn’t something new but in fact

lies deeply embedded in their historical roots since South Africa occupied this former German colony during World War I and administered it as a mandate until after World War II when it annexed the territory. In 1966, the Marxist South-West Africa People’s Organization (SWAPO) guerrilla group launched a war of independence for the area that was soon named Namibia, but it was not until 1988 that South Africa agreed to end its administration in accordance with a UN peace plan for the entire region. Namibia won its independence in 1990 and has been governed by SWAPO since. “There are two organisations that we have good relationship with; that is the National Independent Halal Trust (NIHT) and the Islamic Council of South Africa (ICSA). We have a memorandum of understanding with NIHT where we give the right to come in and assist, advise, inspect and rectify, but not certify. We also make use of their ulamas for issues we cannot solve, such as mechanical slaughtering of chickens,” Ahmed explained. “With ICSA, although it is a very informal agreement, we do have very similar ideologies

and philosophies. They are from Cape Town, South Africa and they just concentrate within that area, not even going beyond the boundaries of the province. And we agreed that this should be the case,” he added. Agreeing with him was Moulana Abdool Wahab Wookay, chief executive officer of National Independent Halaal Trust, one of South Africa’s four main Halal certification bodies. “We believe the Muslims in any country should be looking after the Halal situation in their own country. They are the ones who are running the mosques there, running the Islamic aspects of education and so forth. Nobody else should be doing that, so therefore, they need to run the Halal situation in their own country.”

THE HALAL JOURNAL

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fast track | EUROPE Mecca Cola’s political tone may come as too strong to many, but behind this seemingly aggressive take is the noble concept of charity through business. The Halal Journal caught up with founder Taufik Mathlouthi to find out more. BY SHARIFAH SHAZANA

Justice & Charity Through Business

the Mecca Cola Model IT’S BEEN almost four years now since Mecca Cola first appeared on grocery store shelves across France. Today it is one of the few Muslim brands known throughout the world having garnered extensive media coverage of more than 900 press articles, 40 hours of TV interviews and more than 400,000 internet references. Additionally, it was ranked the 34th among the top brands in the world just a few months after being launched. Considering its humble beginnings of 22,000 Euros, to be ranked among the top 50 brands within such a small period of time is an extraordinary feat “Today, I’m a thirdworld maker of cola,” says Taufik Mathlouthi, the founder of the beverage. But that’s not all Mecca Cola can be proud of. It’s concept of doing charity-business is said to have inspired 486 brands in the Arab and Muslim world to do the same. The concept is simple: 20 percent of profit earned is given away to charity; 10 per cent goes to the Palestinian children and the other 10 per cent to a local charity of the country which the product is being sold in.

This is perhaps the most striking quality about the beverage. Without making any effort, the consumer is making a contribution to a cause. “He’s just buying a product, but with this simple gesture, he’s making sadaqah everyday when he drinks Mecca Cola,” says Mathlouthi. A Political Statement Taufik Mathlouthi is no businessman. But the experience of standing by, helpless, while watching the massacre of Jenin take place was more than he could handle. “I had to do something and start fighting in a non-violent way,” he said. Leaving his 20-year-job of running a radio station, Mathlouthi embarked

on a mission, to provoke the conscience of consumers all around the world. “The Zionist entity is nothing without the support of America,” he says, thus his decision to target the country’s economy. By this he meant that he was targeting “the American foreign policies, the American mentality and their double standards.” His idea was therefore to develop an alternative beverage to that of Coca-Cola, which he says is “the biggest and most well known symbol of America”. With its red can adorned with white script and a distinct taste that is strikingly similar, Mecca Cola is clearly designed to be a challenge to the American beverage. “If 1.5 billion Muslims

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fast track | EUROPE

stopped consuming American products and Israeli goods, we will hurt them in a non-violent way,” he says. Mecca Cola therefore offers as an alternative option for the politically engaged. An option for all those who reject the injustices perpetrated against the innocent, those who are mindful of cultural imperialism and who have a desire to refuse hegemonic control. “Drink with commitment, drink with a taste of freedom,” it reads on each bottle. The rationale behind it is simple, if it tastes the same and costs the same, why give your money to those who perpetrate injustice. The political commitment behind the brand coupled with the charity factor of the business is what distinguishes Mecca Cola from other beverages. “I’m not a merchant of cola, I’m promoting an ideology and a new kind of business derived from the Islamic concept,” said Mathlouti. On Markets Distributed in 64 countries worldwide, Mecca Cola’s biggest market is Europe. While one might think that the Middle Eastern countries would be more aggressive in their support for the beverage, according to Mathlouthi, it is really European Muslims that demonstrate more of a political conscience. “In Europe, you’re obliged in each second to make a conscious effort to keep your faith,” he said, “whereas in Muslim countries they are living as a Muslim without having to think much about it.” His second biggest market is Asia, followed by the Middle East, North Africa and some African countries. Most interesting is their newest market - Malaysia. Despite Mathlouthi’s opposition toward the Zionist regime, an interesting point to note is the fact that Mecca Cola is selling well in occupied Palestine and in areas within Jewish control. Surprisingly, the product is not only attracting the Palestinians. In carrying out their charity actions, Mecca Cola does not discriminate against Jewish, Muslim or Christian children. Out of 5,000 school bags distributed in Tel Aviv, 2,000 went out to Muslim children, 2,000 to Jewish children and 1,000 to Christian children. “Everybody was surprised, but I said don’t be, because that’s how we should be in Islam... I’m not against Jewish people, I’m just against injustice,” Mathlouthi said. New Developments To add on to the range of Mecca Cola is Mecca Tea, Mecca Coffee and Mecca Power – claimed to be the first true Halal energy drink. According to Mathlouti, unlike other energy drinks, the ingredient taurine in Mecca Power comes from

The political connotation attached to the brand name of Mecca Cola therefore represents a choice that the consumer makes – a conscious choice for action, a deliberate choice for change. a source that is Halal. “We are unique in this world because we have Halal taurine.” The establishment of Mecca Café, a franchise system emulating the Starbucks Coffee chain, is set to take place in a number of locations around the world. There is already one in Dubai, with a second one opening in Kuala Lumpur and plans for a third one in Paris. Like Starbucks, his vision for Mecca Café is to see it mushroom around the world. An additional investment of USD15 million in an industrial park in Dubai will also see the opening of three factories by September 2007 that will not only allow him to manufacture his range of products by himself, but also undertake other research and development projects such as concentrated and instant versions of his drinks and smaller varieties of his Halal packaging. “There is already a lot of pressure from the big companies and I need to have my own factories. If not, they can buy over the factories

working for me and threaten to stop manufacturing for Mecca Cola,” he said. The trials and difficulties of maintaining and developing Mecca Cola as a charitybusiness may be many. But for Mathlouthi, it’s all about jihad. “War is nothing,” he says. “Our real jihad is to develop the economy, to develop conscience…” Mathlouthi ’s commitment and determination to avoid non-Islamic banks due to interest-based loans is nothing short of amazing. His advice to other Muslim entrepreneurs: “if you need barakah, seek Halal money”. Mecca Cola’s aim from the beginning has been to battle American imperialism through commerce and to aid the development of Muslim society by the charity through business concept. The political connotation attached to the brand name of Mecca Cola therefore represents a choice that the consumer makes – a conscious choice for action, a deliberate choice for change.

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fast track | AMERICAS

Halal meets Organic

Nature’s Noor founder Sakeena Rashid with her first range of Halal and organic products – baby foods.

Still in its infancy, Nature’s Noor is one of the few Halal food producers in the United States that is also organic certified. Committed to providing food that is healthy and Halal, Sakeena Rashid, the company’s founder and president, shares her story with The Halal Journal. WITH THE realisation that there are not enough Halal products in the market, Sakeena Rashid, a young resident of Dublin, Ohio took to her personal experience for inspiration. The experience of caring for a six month old baby girl while pursuing college education led her to toy with the idea of developing convenient but healthy range of baby meals for hectic Muslim mothers. “I wanted Muslim children to have the same access to healthy and natural food just like any other child,” she said. Thus the formation of Nature’s Noor – an all Halal, all organic food company whose first venture, a Halal and organic range of baby food which has so far received tremendous response from all over the world including the UK, France, New Zealand, Middle East and Asia. “There’s a lot of organic baby foods out there but none of them have Halal certification,” she said. “This is the case not only in the US but also in Canada, France, and many parts of the world.” Apart from being Halal certified, Sakeena believes that being certified as organic has also placed Nature’s Noor in an advantageous position. “The organic industry in the United States is experiencing tremendous growth and we have managed to open up an even bigger market for Nature’s Noor,” she said. Sakeena cited Wisconsin Grocer, a trade publication of the Wisconsin Grocers Association, which reported that the average annual growth of organic food sales nationally is expected at

16 per cent each year for the next few years. This was in comparison to an anticipated three to four per cent growth in all grocery food sales nationally. According to her, despite the overwhelming demand, she finds it hard to cope with production, especially since Halal funding is non-existent in the United States. “Although there are many Islamic banks located in the United States, none of them offer businessrelated loans,” said Sakeena. In a situation like this, she says Muslim entrepreneurs are placed in an ethical dilemma – to stay Halal or give in to the riba’-ridden loans. Additionally, the lack of resources and available information on the Halal industry in the United States also presents a problem. “I had to do an extensive amount of research on my own on Halal. It’s a hurdle for Muslim entrepreneurs not to have access to research, demographics, or important industry contacts,” she added.

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finance

Islamic Bonds

IN PRACTICE Words By PROFESSOR DR. MOHD. MA’SUM BILLAH

T

The 1970s saw a global movement towards commercialisation of the Islamic banking system, spanning countries from the Middle East to South Asia. But growth over the following decade was at a snail’s pace, given the lack of proponents and competition with the fast-paced conventional banking system.

oday however, Islamic financing service (IFS) products have achieved an upward turn in the global market, where demand for financial products that comply within the laws of Shariah is growing fast, not just among the world’s 1.2 billion Muslims, but also among non-Muslims. Islamic bonds are one of the well-established Islamic financial products that have been given high ranks to compete with conventional bonds – the German state of Saxony-Anhalt has just sold Europe’s debut Islamic bond to fulfil current market demand. In this report, Malaysian Islamic bonds will be used as a discussion example to provide a clearer view regarding Islamic bond issues. The Malaysian Islamic financing and banking system is one of the best in the world as compared to the systems of other Muslim countries. Malaysia has floated the idea of an Islamic universal bond to give the fledgling market another helping hand. In order to provide some general knowledge and guidelines, we will examine some of the important elements that are applied by the Shariah system.

IMPLEMENTATION OF SHARIAH IN ISLAMIC BONDS In Islamic finance, any income generated through interest payments via lending or credit activities is not recognized, as it is pure riba’ (usury). A condition was made that before a debt can be sold or negotiated; there must be an underlying contract of sale and purchase involving real, tangible assets at the beginning of the process. This transaction normally contains a delayed payment element in it, so that a debt is created. This is the debt that will later become the focus of the intended securitisation. It is likely that another concept, bai al-inah, is also used in creating debt security. Bai al-inah allows sale and buyback transactions so that an earlier sale of assets would

produce a cheaper price compared to the price tag for the subsequent sale. For example, the first buyer, normally a financier, would pay in cash the purchase price of the asset, say US$100 million, and immediately sell the same asset to the first party, normally a customer, for US$210 million, payable in instalments for five years. The whole process involves a number of interrelated transactions: 1. Normal sale and purchase contract (al-bai). When the customer sold his assets to the financier in the first transaction the sale price was US$100 million. 2. Buy-back transaction that occurred immediately after the first transaction, which THE HALAL JOURNAL

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cost US$210 million. The buy-back and normal sale are known together as bai al-inah. 3. The payment for the buy-back transaction is delayed through the instalment mechanism known in Islam as bithaman ajil, or deferred payment. 4. The debt as owed by the customer as a result of the buy-back transaction will then be sold as securities, accompanied by a certificate or note. 5. When this debt is sold as securities another concept is used – bai al-dayn, or sale of debt. Thus there is a fine distinction between a conventional bond and an Islamic security. In the conventional sense, a bond is a debt instrument whereby the issuer will pay a certain percentage of interest to the buyer of the issued bond, or if it is a zero coupon bond, it will be issued at a discount and repaid in full at maturity. Bond holders will receive the proceeds in the form of interest. In contrast, the debt created in the Islamic transaction is an unpaid purchase price owed by the customer to the financer. Such a debt is not a result of a money-lending process, as there was no such activity. Money-lending is known in Islamic finance as al-Qard. The Malaysian Global Sukuk, although containing an element of floating rate, is not a debtbased security, as it uses Ijarah (leasing of physical assets) as an underlying transaction. Some other key elements that exist are: Al Bai Bithaman Ajil – Financing with deferred repayments over a specific period of time. Al Mudharabah – An agreement to provide the capital by one party and management expertise by the other party. Any losses suffered in the venture will be borne by the provider of the capital. Al Murabahah – Financing with a repayment agreed by both parties that includes the profi t mark-up. Al Qardhul Hassan – Benevolent loan, where the provider of capital is guaranteed at least the principal portion. These are only some of the key elements that could be discussed here. A review of legal, tax and regulatory aspects should go hand in hand with continuous research and development in product development.

ISLAMIC BONDS IN THE REAL MARKET Globally, there are some 260 Islamic institutions, mainly banks, in 76 countries, which handled close to US$200 billion in the system, with the market growing by 12%–15% annually. With the infrastructure for an internationally

thriving sector in place, crossborder financial activities are taking place in offshore centres like Bahrain and Labuan, with countries like Malaysia and Qatar offering Sukuk (sovereign Islamic bonds). Intergovernmental organizations like the Islamic Development Bank have also issued Sukuk. In the UK, the laws have been charged so that those offering Islamic mortgage finance do not pay double stamp duty. The system may also open up into Europe, where there are large Muslim populations in countries like France, or even China. Reflective of the global aspirations and standing of Malaysia, the Islamic Financial Services Board (IFSB) was established in Kuala Lumpur in March 2003 to develop more suitable regulatory and prudential supervisory standards for IFS globally. In the domestic market in Malaysia, up to RM77.4 billion (US$21.46 billion) of Islamic corporate bonds had been issued and rated by financing concept as at December 2003. Finance under the Bai Bithaman Ajil concept contributed the largest portion of the transaction, with 58% from total value, followed by Murabahah (25%).

CRISIS IN THE ISLAMIC BOND SYSTEM Muslims have different understandings of the Islamic law and the regulations that should be practised in many fields, including financial systems, and specifically the Islamic bond system. Because of this, there is no real worldwide established Islamic bond that is accepted by all Muslims – even the one just issued by the Malaysian financial system. Not all Muslim countries have given their full support to these new Islamic products, as compared to conventional bonds, which have been widely

supported all over the world, including among Muslims. Islamic bonds somehow obtained a small portion of the international market, with a minor injection by western countries such as England, Germany and America. Muslim countries did not put much effort into building united and strong Islamic financial products, which should be dominating the Muslim market at least.

DISQUALIFIED COMPANIES TO INVEST With the better systems that keep on being developed by Muslim economists, Islamic bonds might be able to attract buyers to inject big amounts of capital worldwide. However, there are doubts about the availability of suitable companies with good track records to flow the money through, which will lead the economic growth of each industry and be able to sustain high earnings growth.

CONCLUSION As senior fellow with the Institute of Islamic Understanding Malaysia (IKIM), Mazilan Musa said, “The differences are a minor disagreement and not a fundamental one. Malaysia has taken the path that Islamic banking products are permissible if there is no evidence to suggest otherwise.” As such, harmonizing Shariah opinions is not only a great challenge, but is necessary for global IFS to reach a higher plain. Observers say Malaysia is already seen as a leader in IFS globally, and the country, as the new head of the Organization of Islamic Conference, could try to utilize this goodwill at a political hj level to push IFS forward.

Article has been reproduced with permission from Islamic Finance News www.islamicfinancenews.com

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finance update

MICROLINK LAUNCHED PROSPECTUS FOR LISTING ON MESDAQ

AmIslamic Bank Officially Launched AmBank Group’s Islamic banking subsidiary, AmIslamic Bank Berhad was officially launched by YBhg Tan Sri Dato’ Sri Dr Zeti Akhtar Aziz, Governor, Bank Negara Malaysia early May. The launch marks another important milestone for AmBank Group’s Islamic banking operations which started in 1993, conducted via the Islamic banking windows under the Skim Perbankan Islam, or Islamic Banking Scheme. In 1994, the AmBank Group Islamic Banking Unit was established and four years later AmFinance became the first finance company to operate an Islamic branch at Wisma Kraftangan, Jalan Tun Perak, Kuala Lumpur. It opened its first Islamic Banking Centre at Menara Dion, Kuala Lumpur in 2001, offering a full product range from retail and commercial to investment products. On May 1, 2006, AmIslamic Bank commenced its business operations. Tan Sri Dato’ Azman Hashim said, “Today, we are pleased to celebrate the birth of our full-fledged Islamic banking subsidiary. With an initial capital of slightly over RM1 billion and loans of RM9 billion, and 13 years of experience in offering Islamic banking and services through AmBank, we will continue to offer a full range of Islamic banking products and services to our customers.” The launch came alongside Bank Negara Malaysia’s efforts

at strengthening the financial resilience of domestic Islamic banking institutions. BNM has considered the funding needs of both private and public sectors, as well as the rising interest for alternative mode and financial instruments in the domestic and regional market. The establishment of Islamic Financial Services Board (IFSB) to promote best practices in Islamic financial services industry, the setting up of the Islamic Banking and Finance Institute Malaysia (IBFIM) to provide basic programmes on Islamic Finance. Most recent was the formation of the International Centre for Education in Islamic Finance (INCEIF) to promote greater linkages and to make Malaysia a leading centre of education and research in Islamic Finance are proofs of BNM’s seriousness in this regard. These entities augur well for BNM’s Financial Sector Masterplan which prioritises Malaysia’s development as a regional Islamic banking and financial centre. “Given the universal nature of the Islamic banking licence, the attention given to the capacity for innovation will become an important defining factor in the progress of Islamic finance. The huge potential in Islamic finance can only be realised if sufficient resources and drive are accorded to it,” said Tan Sri Dato’ Sri Dr. Zeti Akhtar Aziz, Governor hj of Bank Negara Malaysia.

Information technology (IT) solutions provider Microlink Solutions Berhad recently launched its prospectus pursuant to a listing on the MESDAQ Market of Bursa Malaysia. The listing exercise will see Microlink issuing 12 million new ordinary shares of 10 sen each at an issue price of 49 sen per share. Of these shares, three million will be offered to the Malaysian public, two million will be made available to eligible directors and employees while the remaining seven million will be privately placed out. They expect to raise RM7.24 million from the listing exercise, of which RM2.225 million will be used for research and development expenditure, RM3.515 million for the group’s working capital requirements while listing expenses will account for the remaining RM1.5 million.

Microlink provides IT solutions to the global financial services industry. Their product MiBS is an end-to-end banking solution developed to automate core processing functions such as deposits/investments, loans/financing, treasury and trade finance for both conventional and Islamic banking. Since 1996, Microlink has secured numerous IT solution contracts from over ten banking and financial institutions. Within the last three years, Microlink has also secured contracts with Islamic financial institutions in Thailand, Brunei and North Africa, while setting up offices in Jakarta, Indonesia and Kuwait to expand its South-East Asian and Middle East operations respectively. “It is important that we seize the initiative to prove that Malaysian-made products and services can compete on a global platform. For inspiration, we need look no further than the example provided by India. Through sheer grit, determination and innovation, India is now producing information and communications technology that is widely acknowledged to be the best in the world. There is no reason why Malaysian-made products and services should not be a synonym for quality, and that is what Microlink aspires to,” said its chairman Datuk Ali Abdul Kadir. It was also awarded the Multimedia Super Corridor status in 2004 by the Malaysian Government for the company’s R&D in Islamic banking solutions, in keeping with its goal of hj making Malaysia an Islamic banking hub. THE HALAL JOURNAL

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finance update

Favourable Q1 Results for KFH,

MORE ISLAMIC PRODUCTS IN THE OFFING Kuwait Finance House recently announced their net profits for the first quarter of this year, posting a hefty USD274.2 million with shareholder’s stake being USD127.2 million, an increase of 52 per cent over the same period last year. Bader Abdul Mohsen Al-Mukhaizeem, KFH chairman and managing director further announced an increase of 40 per cent in their total assets to USD16.9 billion, a 27 per cent increase in deposits to USD11.7 billion and a 20 per cent increase in their profits per share to USD1.03 for Q1 2006. Al-Mukhaizeem noted that part of the group’s success has been the increase on Moody’s ratings on their long and short term deposits from stable to positive. He also emphasised a continuous policy of global expansion to open

Bader Abdul Mohsen Al-Mukhaizeem

up new markets and enter projects and alliances with other major banks worldwide. “This year we officially opened KFH Malaysia, marking a major step towards expanding abroad. We hope that will serve as a bridge for trade exchange and economic cooperation between South East Asian countries and GCC states,” he said. Earlier in June, Kuwait Finance House (Malaysia) Berhad announced the introduction of its Promissory FX Contract-i. This hedging product

protects customers against fluctuations within the foreign exchange rates and is also fully Shariah compliant. It is based on the concept of Wa’ad, whereby the bank enters into a foreign exchange contract for delivery on a specific future date as determined by the customer. This innovative product enables customers to protect their stream of revenues or commitments in foreign currencies against exchange rates’ uncertainty and volatility. It will greatly benefit customers with cross-border currency flows such as importers, exporters, service providers, investors and institutions involved in fund raising activities. KFH Malaysia also introduced Musyarakah Mutanaqisah Home & Property Financing – i, a new Islamic financing

product that is based on the Shariah concept of Musyarakah Mutanaqisah (diminishing partnership) and Ijarah (leasing). A form of diminishing partnership contract, it is where the customer and the bank will jointly purchase and acquire the property, which is then leased out to the customers. Monthly lease rentals paid by the customer will be applied towards increasing their ownership of the property until the customer fully owns the property. “This product makes it possible for customers to own their own home according to the principles of Shariah. This facility will be made available initially for properties in which KFH has invested in. One such property is the Pavilion project along Jalan Bukit Bintang,” said Salman Younis, executive director of KFH Malaysia. hj

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2006 JULY+AUG THE

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JOURNAL

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ISLAMIC CALLIGRAPHY IN CHINA TRIO JOUBRAN’S CD ISLAMIC BUSINESS ETHICS GOING TURKISH WITH ANATOLIA A LOOK AT BRUNEI DARUSSALAM

Despite all its splendour and beauty, Chinese Islamic Calligraphy - a distinct Chinese style of recreating the Quranic word – has received little attention and recognition worldwide.

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islamic art

Chinese Islamic Calligrap hy

Obscure

Painfully Pictures courtesy of Anthony Hayden Garnaut

The Chinese tradition of Islamic calligraphy is an obscure art form in the Islamic world beyond, but well and alive inside China. The Halal Journal took the opportunity to dig deeper by talking to Anthony Hayden Garnaut, a PhD History student with the Australian National University whose travels across northern China, lent him a deeper understanding of the captivating art form. Words By SHARIFAH SHAZANA SYED SALIM AGHA

“…I noticed there was a special style of Chinese calligraphy, but didn’t really get my head around what was meant by “Chinese Islamic Calligraphy” until I visited an Islamic cultural museum in Cangzhou, a town few hours south of Beijing that has a rich tradition of Islamic scholarship and calligraphy. Here I got a feel for the distinct Chinese-style of Islamic calligraphy as against Islamic calligraphy that may happen to be written by a Chinese person in one of the several styles of calligraphy popular outside China.” ANTHONY HAYDEN GARNAUT

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here is no precise date to mark the arrival of Islam to China, but reliable records has it that it was during the Tang Dynasty that the third Caliph, Uthman ibn Affan, sent a diplomatic envoy to introduce Islam to the Emperor Gaozong. Known as ‘Dashi Jiao’ then, which means ‘religion of Arabs’, Islam has come a long way, spreading and developing throughout China for more than 1300 years and seeing a following of more than 100 million today. Despite all its splendour and beauty, Chinese Islamic Calligraphy - a distinct Chinese style of recreating the Quranic word – has received little attention and recognition worldwide. Garnaut, whose area of expertise is in the history of Islam in China, says that this is probably because people tend to think of China as the opposite end of the world to Islam. “They think it strange that there could be a Chinese tradition of Islamic calligraphy to put alongside Persian, Turkish and North African traditions”. A POINT OF COMMONALITY Interestingly enough, both Islamic and Chinese cultures have a shared reverence for the written word.

This common respect, according to Garnaut, can perhaps be seen to derive from the particular status accorded to the Quran in the Islamic tradition and Confucian canon in the Chinese tradition. In ancient China, for example, calligraphy was treated as a basic criterion in the selection of senior officials to the imperial court. The mastery of calligraphy was a skill that was an imperative in determining a better position in society. For Islam, the recreation of the Word into an image can be seen as the highest form of visual art. According to Abdelkebir and Mohammed in their book, The Splendour of Islamic Calligraphy, “…the Muslim artist constructs the semblance of an object (for only God can create) relating to something already inscribed on the Sacred Table. By this action, he expresses the essence of art: to bring out in infinite variety what is already there…” As Garnaut says, “even though the Quran is essentially a recited text, not a written text, the fact that the Quran is perfect and unchanging encourages people to explore the many layers of beauty inherent in a static text. That is what calligraphy is, an expression of the beauty that lies concealed within the written word”.

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Figure 3: An example of the Sini script in a string of diamonds

Figure 4: “Ya Mustafa” (“O Chosen One!”), a favourite name for the Prophet Muhammad)

the Alif of the phrase ‘Ya Mustafa’ (O Chosen One) (See Figure 4). The character Alif which looks like the Roman letter ‘l’, is used in Chinese Islamic calligraphy the same way a single vertical stroke is employed in popular Chinese calligraphic representations, both functioning as the base for artistic composition (See Figure 5).

form has been venerated in the Islamic world. This lack of awareness internationally, could stem from the fact that there has not been much written on the subject. This is probably due to the fact that not many scholars in China write about Islamic cultural history in the first place. But things are slowly changing says Garnaut. “When the anti-religious policies of the Cultural Revolution were relaxed in the 1980s, Muslim scholars were firstly interested in regaining a basic knowledge of the Quran and the practical knowledge that was needed to support the religious life of the Islamic community in China. Now, twenty-five years after the mosques were re-opened, Islamic cultural history is beginning to attract the attention of many scholars”. With China’s open door policy, the emerging global Halal industry is set to rekindle economic ties of the Chinese Muslims with the Arab and Muslim world. China is expected to export more than just halal products to the world but also its culture. This will be an important factor in shaping the landscape of the future decades, as history is set to repeat itself - the new silk road to China.

THE SINI SCRIPT The features of Chinese Islamic calligraphy have not been formally written down by any Chinese calligrapher, however, the closest there is to a formal style is the Sini script. Sini, says Garnaut, commonly practiced throughout eastern China, refers to a “rounded, flowing script, whose letters are distinguished by the use of thick and tapered effects” (See Figure 1). Figure 1: An example of a placard in Sini script which reads, “Why holdest thou to be forbidden that which Allah has made lawful to thee?” (Quran 66:1)

In China, except for a few ancient mosques, all of the mosques adopt traditional Chinese architecture with a square courtyard and temple-like buildings that are square and symmetrical in design. However, in place of a four character Chinese phrase above the door, Chinese mosques usually have Arabic placards in Sini script which depict the hadith or a line from the Quran. (See Figure 2) Figure 2: A placard with the Shahadah above the entrance to the Beiwu mosque, Dachang, Hebei

More intriguing, are the placards placed on either side of the entrance which often tend to box the Arabic script into the form of a square, as in Chinese characters, and rotate it by forty-five degrees to form a diamond. The result - a hanging string of diamonds that, according to Garnaut, “may look strange to the eye of someone familiar with Arabic decorative art in central Asia or Iran, but looks perfectly normal to the Chinese eye who are accustomed to reading squareshaped Chinese characters.” (See Figure 3) Apart from the square form, another common variation of the Sini script is the captivating rectangular form where “one of the names of God or the Prophet is wrapped around an extended vertical stroke such as

THE STATUS QUO In 2004, during the Fourth International Calligraphy and Calligraphic Art Exhibition and Competition held in Pakistan, works by several of China’s leading Arabic calligraphers were entered. However, according to Garnaut, none of the works in Sini script caught the eye of the judges. This was taken in China as “evidence that the judges did not understand the formal features of the script or recognise it as a distinct style”. It is therefore a little disappointing to note how little this art Figure 5: An ancient Chinese calligraphic rendition of the character hu (tiger)

For more information on China and its heritage visit http://www. chinaheritagenewsletter.org/

hj

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browsing

Anatolia

This family-run restaurant was the first Turkish food outlet in Singapore when it opened in 1998. Begin at the salad bar, where a large selection is available including the juicy chicken salad with yogurt as well as spinach salad. Each serving is quite a bargain at S$3 a bowl. The freshly baked bread also makes scrumptious pre-dinner bites. For the main course, choose the kisir (boiled red rice) with beef or chicken kebabs which are marinated overnight and succulently grilled. Other worthy selections include lamachun (thin mini pizzas) served with lettuce and lime. For dessert, the homemade Turkish ice cream is brought to you with a flourish by the chefs as they demonstrate the fun way to serve the dessert. The sweet fragrant Turkish tea served in quaint tea glasses is a soothing after-dinner drink that goes perfectly with the classic sweet, Turkish delight. ADDRESS: 14 Scotts Road, #02-58/59, Far East Plaza, Singapore MRT STATION: Orchard | TEL: +65-6836 3352 | OPENING HOURS: Mon – Sun, 8am – 11pm SPECIALTIES: Turkish kebabs, lamachun, soups

Music Update

Yusuf Islam Readying First Pop Album Since 1978 Yusuf Islam, the artist formerly known as Cat Stevens, has reportedly finished his first pop album since his 1978’s “Back To Earth” album and insists that the increasingly volatile political climate has inspired his comeback. The UK star who converted to Islam in 1977 and quit the music industry two years later, now can’t seem to just sit back and watch life from the sidelines. He has recorded a new album chronicling how he feels about the current state of the world, which will be released on Polydor, a division of Universal due to be released in autumn 2006. “There were one hundred reasons for leaving the music industry back in 1979, not least because I had found what I was looking for spiritually. Today there are perhaps one hundred and one good reasons why I feel right making music and singing about life in this fragile world again.” “Much has changed but today I am in a unique position as a looking-glass through which Muslims can see the West and the West can see Islam. It is important for me to be able to help bridge the cultural gaps others are sometimes frightened to cross,” he added. The as-yet-untitled album is produced by Rick Nowels, who has worked with artists such as Madonna and Dido. Sources say some selections are highly reminiscent of Stevens’ 1971 album “Teaser & the Firecat,” which sports such enduring tracks as “Moonshadow”, “Peace Train” and “Morning Has Broken”. Yusuf Islam (born Stephen Demetre Georgiou on July 21, 1948) made headlines in 2004 when he was denied entry into the US and his flight was diverted after his name turned up on a US government “watch list”. He currently lives with his wife and children in London, where he is an active member of the Muslim community. He founded the Small Kindness charity, which initially assisted famine victims in Africa and now supports thousands of orphans and families in the Balkans, Indonesia, and Iraq. He also founded the charity Muslim Aid but left as founding chairman in 1999.

CD Review

TRIO JOUBRAN, RANDANA

A virtuoso of the oud, Samir Joubran is hailed throughout much of the Arab world and is now fast gaining international recognition. Since his first appearance in France at the “Nuits Atypiques” festival in Langon in 2002, the release of his first album “Tamaas” in February 2003 further delighted the public. In this album, Samir performs in duo or trio formations with his younger brothers, Wissam Joubran and Adnan Joubran. Wissam, 20, is the first stringed-instrument maker in the Arab world to enter the Antonio Stradivari Institute in Italy and has a remarkable gift for improvisation and intelligent harmonious transitions between the Arab Maqamats. Adnan, 18, is considered a prodigy by his elder brothers. Together, the three brothers have created a spur within the European classical pop circle. Their music mimics the likes of Vanessa Mae from UK, and their beautiful music transcends their Palestinian heritage and identity via modern contemporary platform. This is truly an Arabesque experience.

Book Review

ISLAMIC BUSINESS ETHICS

First published: Goodword Books in 2003 AUTHOR: RAFFIK ESSA BEEKUN

This is a good reference for Muslim businessmen and business employees who have to deal with ethical situations on a day-to-day basis. The author’s goal is to help Muslims engaged in business to act in accordance with the Islamic system of ethics. It provides key principles of management from Islamic perspective for guidance of Muslim entrepreneurs. This book also makes a good read for non Muslims as well to learn more on how to approach the Muslim business world. “Islamic Business Ethics” can be found in all major bookstores. For more info, log on to www. goodwordbooks.com.

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country in focus

IN BRUNEI, future plans

are mulled as oil gusher slows Brunei Darussalam conjures up different images and impressions whenever its name is mentioned. To Malaysians, it’s a partner of the larger federation that they wish they had in the 1960s. Words By TONG YEE SIONG

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o those unfamiliar with the Southeast Asian region, Brunei might as well have been an obscure spot on the world atlas had it not been for the country ‘s large oil and gas reserves. Yet for others, Borneo is simply shrouded in mysticism and mystery - typical of anything that is associated with that part of the world known as the Borneo island. But history has many interesting stories to tell about Brunei: It was so powerful from the 14th through the 16th century that at one point, its territory covered Sarawak, Sabah and the southern Philippines. Brunei later entered a period of decline due to internal feuds over royal succession which coincided with the rise of European colonial powers in the region. Brunei eventually lost much of its territory to the White Rajahs of Sarawak - the first being English voyager James Brooke. Brunei remained a British protectorate from 1888 to 1984. Despite all the upheavals over centuries, absolute monarchy survived in Brunei, making it one of the most politically stable countries in Asia save for an armed uprising attemptthwarted with British assistance, in the 1960s. BLESSING BECOMES CURSE In the following decades, this centralised political system, coupled with a small population of some 374,000 and huge oil revenues, enabled the government in Brunei to provide all medical services and to subsidise everything from food to housing. At US$23,000, Brunei’s gross domestic product (GDP) per capita is far above that of most other Third World countries (Malaysia’s GDP per capita is about US$12,100 and Thailand’s is US$8,300, according to CIA World Factbook’s estimate). Additionally, Brunei is notable in Asia for not levying any income tax on its population. But what worked for Brunei in the past may have become a curse. Because oil and natural account for almost exports - accounting for half of Brunei’s gross domestic product and almost 90% of government revenue

- the economy now faces the danger of having all the eggs in one basket. Currently the third-largest oil producer in Southeast Asia, Brunei pumps about 203,000 barrels a day. It is also the fourthlargest producer of liquefied natural gas in the world. The risk seems acute when one considers the fact that Brunei’s proven oil and gas reserves could run dry as early as 2015 if it cannot find significant new reserves through deep-sea exploration. Fluctuating oil prices also create uncertainty and instability in Brunei’s economy. Another impetus for Brunei to widen its economic base came in the form of the 1997 Asian financial crisis, when Amedeo Development Corporation, Brunei’s largest construction firm which previously helped fuel the economy through various large-scale projects, collapsed. Consequently, Brunei slipped into a mild recession. Herein lies the dilemma for Brunei’s government. Sultan Hassanal Bolkiah and his Cabinet recognise the

need to diversify Brunei’s economy, but they are also worried an increased integration with the world economy may undermine internal social cohesion which Brunei has long enjoyed. ECONOMIC DIVERSIFICATION Such considerations have prompted Brunei’s government to carefully chart its economic diversification. To play a more prominent role in the world economy, Brunei chaired the 2000 Asia-Pacific Economic Cooperation (APEC) forum. Brunei’s key strategy now is to build foreign reserves and invest them around the world to help provide for future generations. This has been done with limited success and great caution, especially after Prince Jefri Bolkiah, the Sultan’s brother, went on a spending spree in the 1990s that ended in ruin and rancour. Brunei sued Prince Jefri in 2001 for misappropriating US$15 billion intended for foreign investments. The money was said to have been improperly withdrawn from the Brunei Investment

Brunei’s key strategy now is to build foreign reserves and invest them around the world to help provide for future generations.

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Brunei at a Glance

Limited market for Halal food exports

To ensure the supply of fresh halal beef, Brunei’s government in 1987 acquired Scott Creek/Willeroo Station that owns some 6,000 square kilometres of cattle farm in Northern Territory, Australia. Some 33,000 cattle are reared in the farm and then imported live for slaughter in Brunei, in order to ensure Islamic religious requirements are observed. Brunei also assists local stock farmers with calves, machinery, feed, seedling, fertilisers and veterinary care. Export opportunities to Brunei are thus extremely limited in view of the overwhelming government support given to local farmers as well as the strict regulations, the Agriculture and AgriFood Canada concluded in its study published in 2001.

Agency, headed by Prince Jefri who was also the Finance Minister until he fell out with the Sultan. A settlement was subsequently reached out of court. Domestically, Brunei has tried to encourage entrepreneurship and to make the workforce seek alternatives to employment by the public sector. Unemployment is rising and many school-leavers are unable to get jobs. This, the government wants to achieve by nurturing new downstream businesses that leverage on Brunei’s oil and gas industry as well as strengthening the existing non-energy industries. This is why the national airline, Royal Brunei, has outlined ambitious plans to make Brunei an international travel hub between Europe and major Asian destinations. Another closely watched development is the possibility of Alcoa setting up an aluminium smelting plant in the major industrial site of Sungai Liang. Based in the US, Alcoa is the world’s leading aluminium producer with over US$20 billion in revenue per annum. Overall, Brunei’s economic diversification has been slow to gain traction. Observers argue that the country’s small private sector needs more opportunities to spread its wings, and say the government’s overreaching role is stifling entrepreneurship. A plan to privatise the state telecommunications firm was dropped after workers reportedly objected to losing their government employment rights. Another obstacle for private companies in Brunei is

CAPITAL: Bandar Seri Begawan POPULATION: 379,444 ETHNIC GROUPS: Malay 67%, Chinese 15%, indigenous 6%, other 12% RELIGIONS: Muslim (official) 67%, Buddhist 13%, Christian 10%, indigenous beliefs and other 10% LANGUAGES: Malay (official), English, Chinese NATURAL RESOURCES: Petroleum, Natural Gas, Timber ECONOMY GDP (PURCHASING POWER PARITY): USD6.842 billion GDP - COMPOSITION BY SECTOR: Agriculture: 3.6%, Industry: 56.1%, Services: 40.3% BUDGET: REVENUES: USD3.765 billion EXPENDITURES: USD4.815 billion AGRICULTURE PRODUCTS: rice, vegetables, fruits; chickens, water buffalo, eggs INDUSTRIES: petroleum, petroleum refining, liquefied natural gas, construction EXPORTS: USD4.514 billion EXPORTS - COMMODITIES: crude oil, natural gas, refined products EXPORTS - PARTNERS: Japan 38.1%, South Korea 14%, Australia 11.2%, US 8.6%, Thailand 7.9%, Indonesia 6%, China 4.5% IMPORTS: USD1.641 billion IMPORTS - COMMODITIES: machinery and transport equipment, manufactured goods, food, chemicals IMPORTS - PARTNERS: Singapore 32.7%, Malaysia 21.2%, UK 8.3%, Japan 7.2% CURRENCY (CODE): Bruneian dollar (BND)

human resources. Many find it hard to recruit and retain local workers, who currently still prefer secure government jobs with generous benefits. ISLAMIC BANKING The one area that Brunei does have much potential in is offshore financial services. As a late entrant into the sector, Brunei nonetheless introduced much legislative and regulatory reform over the past four years to position itself as a viable tax-free jurisdiction for international banks and financial institutions. It’s a strategy that’s beginning to pay off. Brunei has attracted, among others, HSBC, Royal Bank of Canada and Hong Kong’s Sun Hung Kai International Bank, to provide offshore services there. One market

segment Brunei is keen to develop is banking products for the fastgrowing international Islamic financial sector. Brunei’s conservative Muslim traditions - Islam is the official religion of Brunei and the Sultan is the head of religion - give the Brunei International Financial Centre (BIFC), a government agency tasked with developing the country’s financial sector, an advantage and incentive to approach banks in the Middle East that want to shift and diversify their operations. Until now, that’s an opportunity that remains largely uncaptured. Moving forward, BIFC officials see a huge demand for Brunei’s Islamic banking given that an estimated 30% of bank deposits in the country are already in Islamic instruments that are compliant with Shariah principles. As recent as June this year, Brunei announced the setting up of a new government board to regulate Islamic banking and financial businesses. Dubbed the Shariah Financial Supervisory Board, the council counts senior Finance Ministry officials, a Shariah High Court judge, a top Muslim cleric and legal specialists among its board members. “A modest version of Singapore with a dash of Bahrain,” said Robert Miller, BIFC head of supervision, when describing what Brunei aspires to be in the world of global banking. That is, by far, the clearest indication of how Brunei has come to acknowledge its good old, carefree days of living on petrodollars are over. hj THE HALAL JOURNAL LIVING

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on display HALAL PRODUCTS ARE THOSE THAT ARE GOOD, PURE AND SAFE FOR HUMAN CONSUMPTION. IT RANGES FROM FOOD TO COSMETICS, PHARMACEUTICALS TO TOILETRIES. HERE ARE SOME OF THE PRODUCTS WITH THE HALAL GUARANTEE. Krakatau Herbal Tea Here’s some good news for diabetic patients. Introducing Krakatau Herbal Tea, a traditional mix of herbs that help lower and stabilise glucose levels in blood, as proven by several preclinical trails. Made from a natural plant, Cassia folium, drinking Krakatau Herbal tea regularly can prevent or minimise secondary complications arising from diabetes. It also contributes to an accelerated healing of wounds and contains no artificial preservatives and leads no side effects. Packaged in small tea bags, the tea can also be consumed as a tonic drink by healthy people. For more info on this Majelis Ulama Indonesia (MUI) Halal certified product, please call Ampuh Berkat Niaga (M) Sdn Bhd at +603-5511 2011. Halagel Herbal Toothpaste Made from nature’s best herbs of neem, miswak, clove, and rock salt, Halagel Herbal Toothpaste is made from 100 per cent all natural sources. It contains no gelatine or bone ashes, which make it the best alternative for Halal toothpaste. It also does not contain any fluoride or unsafe chemical ingredients and is suitable for Muslims, vegetarians and health conscious consumers. This Halal Food Council S.E.A. certified product is available from all leading supermarkets, pharmacies and retail outlets. For more info, please contact Halagel (M) Sdn Bhd at +604-425 1287 or log on to www.halagel.com.

Liasara Frozen Murtabak

From the manufactures of the world’s first breaded tropical range, Liasara Fine Food latest Halal frozies addition is an innovative twist to the traditional murtabak. With a choice of Chicken or Beef, these murtabaks are bursting with flavours and spices, nicely wrapped in a soft skin which is then parbaked. All you need to do straight from the freezer is either to grill it in a pan or bake it for that crispy skin texture and a healthier choice for the family. It also comes with the traditional pickled onions. This JAKIM Halal certified delicacy will soon find its way in major hypermarkets across Malaysia. For more info, please log on to www.liasara. com or call +603-7806 4750 or email at info@liasara.com.

Taharah Exotic Clay Soap Instead of digging for clay in your backyard to perform taharah or samak, there is now a simpler way – use a clay soap! Made from 95 per cent clay, the Taharah soap contains vitamins A, C and E and has all the essential nutrients and minerals to moisturise, soften and brighten your skin. It can also be used for bathing as well as to wash clothes and personal effects. It also absorbs excess oil from skin and has healing properties for skin, including rashes, eczema, acne and pigmentation. For more info on this JAKIM Halal certified product, please call Top Corridor Sdn Bhd at +603-2144 8350 or check out www.topcorridor.com.my.

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JCORP

Giving Back to Society the Islamic Way

Highly conscious of its role in society, multi-business Johor Corporation (JCorp) has embarked on many corporate social responsibility projects. Offering affordable healthcare services, its most outstanding project by far has been its network of charity clinics, the Klinik Waqaf An-Nur. For successfully revitalising the concept of waqaf, Johor Corporation was recently awarded The Halal Journal Award for the Best Corporate Social Responsibility project 2006. The Halal Journal talks to its chief executive, Tan Sri Dato’ Muhammad Ali Hashim.

TELL US ABOUT THE IMPORTANCE OF INTEGRATING ISLAMIC VALUES WITHIN A CORPORATION. As a corporate organisation helmed principally by Muslim executives, we are duty-bound to integrate Islamic values into every aspect of our corporate and business life. We also regard it as our duty to ensure that, other than realising fully business and corporate objectives, all methods, processes and approaches must also similarly fully comply and be aligned with the Islamic way. In fact we have to ensure that we go beyond just the direct impact and work hard to ascertain that all outcomes, including side-effects and spill-overs, intended and unintended, that are created through business actions, are similarly fully aligned. We take pains to ensure, above all, that business success do not result in ultimately alienating non-business members of the larger community, nor marginalising the poor and the less fortunate, which is unfortunately the more common outcome today.

We take pains to ensure, above all, that business success do not result in ultimately alienating nonbusiness members of the larger community, nor marginalising the poor and the less fortunate, which is unfortunately the more common outcome today.

WHY DO YOU THINK YOU WON THE HALAL JOURNAL AWARD FOR BEST CORPORATE SOCIAL RESPONSIBILITY (CSR) PROJECT? Among the things we did that perhaps attracted the The Halal Journal’s attention was when we took it upon ourselves as a business and corporate entity to adopt and adapt the waqaf approach in benefiting the larger community through structured and institutionalised corporate social responsibility programs . The best example is obviously JCorp Group’s chain of waqaf clinics and hospital, which todate are established at four mosques in Johor and elsewhere, and whose number is expected to increase in future. To-date these waqaf clinics (and a hospital in Pasir Gudang, Johor - the first waqaf Hospital in Malaysia) are supported mainly by JCorp’s subsidiary in the healthcare business, KPJ Healthcare Berhad, which has offered very affordable and subsidised medical and health services as well as dialysis treatments to more than 240,000 patients of all ethnic groups and faiths. These patients include many of those deserving ones who were given access to financial support offered by the waqaf funds established for the purpose, as well as from the Baitumal.

HOW DO YOU THINK THIS AWARD CAN ENCOURAGE THE DEVELOPMENT OF JOHOR CORPORATION? The setting up of a comprehensive, corporate-driven CSR Program by JCorp utilising the waqaf institutional form was a bold, entrepreneurial and unprecedented move. Many quarters were initially sceptical about this move, and the award and recognition validates and legitimises this ground-breaking initiative. With this recognition we will not only expand the work already done but also bring greater

impact from existing CSR programs. It definitely encourages us to venture into other new, more exciting possibilities that will have a greater and more far-reaching impact in terms of Islamising business life and corporate practice generally. For example, we have already placed on our screen a working model of possibly transforming JCorp itself, over time, into a fully waqaf corporate entity. This is thoughtimportant to counter the extreme economic injustice and social disparity that is the more likely long term outcome of unbridled capitalism or corporatism as is generally structured and practised throughout the world today. It is incumbent upon Muslim societies, and Muslimled corporate sectors in particular, to address this issue which is beginning to be a serious global hj concern.

68 THE HALAL JOURNAL

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MATRADE


The Halal Journal July/Aug 2006