The Halal Journal May/June 2006 by The Halal Journal

AUSTRALIA AU$6.50 • MALAYSIA RM9.90 • SINGAPORE S$5.50 • UAE DHS10 • UK £2.95

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

| kasehdia.com | www.halaljournal.com | MAY+JUNE 2006

A HALAL ECONOMY? The coming together of Islamic Finance & Halal Business

Port of

Rotterdam

Europe’s largest port is planning for a European Halal Distribution HALAL AND KOSHER An American Scenario EUROPEAN RETAILERS GO HALAL A New Kind of Demand Rises TO STUN OR NOT TO STUN A review of global practices

LIVING: THE CALL OF TURKEY • PRIDE OF PUTRAJAYA • DINING AMIDST ISLAMIC ART • A VIEW FROM TWO WORLDS • MUSIC, BOOK AND PRODUCT REVIEWS • PLUS MORE INSIDE

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The World Halal Forum

“the global halal market - an industry perspective”

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

M AY + J U N E 20 0 6

contents 18} THE PREMIER GLOBAL HALAL INDUSTRY EVENT

The moment arrives

24} HALAL AND KOSHER

The true market neighbours. An America scenario

27} THE DAWN OF A HALAL ECONOMY?

When Halal financing and Halal business collides

34} EUROPEAN RETAILERS GO HALAL

European hypermarkets are forced to look for new hunting grounds. Guess what’s the new niche?

38} SELANGOR’S COMPETITIVE ADVANTAGE

Malaysia’s most developed state has the most to offer in terms of Halal. Find out why

42} THE MUSHARAKAH ATTRACTION

Venture capitalists built the US Silicon Valley. Can musharakah build the Halal market?

52} HUMAN RESOURCES IN THE HALAL INDUSTRY

31}

Port of Rotterdam

Europe’s largest port is planning for a European Halal distribution gateway

New opportunities are on the horizon

62} STUNNING VS HALAL

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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T We seek to normalise the image of Muslims away from the frightful headlines and caricatures of violence. Sarah Joseph, editor of emel magazine

Regulars 08} QUIETLY SPOKEN Crucial contact: Lessons from the Crusades

08} GLOBAL NEWS

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

14} BETWEEN THE LINES

Signposts: Let statistics show you the way

16} MATRADE NEWS

Choice companies and products from Malaysia for the world

Living

Ed’s Note

his issue of The Halal Journal comes right at the peak of the annual global Halal calendar. In May, Kuala Lumpur hosts the two largest –and arguably most important– Halal market events, the World Halal Forum and the Malaysian International Halal Showcase (MIHAS). The combined pulling-power of these two major trade events draws the market leaders of the Halal industry into Kuala Lumpur for an intense week of meetings, awards, speeches, presentations, networking opportunities, media events - and of course plenty of deals. Both events continue to reinforce the global scope of the Halal market with participants flying in from over 30 countries around the world, with every continent represented. And it is not just in terms of geography that the Halal market is showing some muscle. More market sectors than ever before are represented at these two events, with the World Halal Forum boasting involvement from some of the world’s leading MNC’s from the manufacturing, retail, restaurant, logistics, and banking sectors. There seems little doubt that we are witnessing the blossoming of a new market paradigm, a global Halal market economy based on Halal compliance. In celebration of all this, we are proud to present our bumper edition of The Halal Journal, with a cover story on the new European Halal Gateway at the Port of Rotterdam. We would like to extend a warm welcome to all visitors to Kuala Lumpur, especially those of you involved in The World Halal Forum and MIHAS 2006. We look forward to meeting old acquaintances and making new friends at both events. See you there!

the Halal Journal team

69} THE PRIDE OF PUTRAJAYA How Islamic architecture elevated the status of Malaysia’s capital

:: the Heart of The Halal Journal ::

72} BROWSING

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.

74} COUNTRY IN FOCUS

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 checked out Sami Yusuf’s latest album, ‘Puriﬁcation of the Heart’ by Hamza Yusuf and the Museum Restaurant TURKEY- A look at a country who wants the be the healthy man of Europe

78} ON DISPLAY

Halal, cool and good stuﬀ currently on the shelf

80} PARTING WORDS

Magazine editor Sarah Joseph on understanding between two worlds

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We believe that the emerging global Halal market will be one of the great market forces in the coming decades.

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HONOURING The Team EDITOR

OUTSTANDING

Jumaatun Azmi WRITER

Kamarul Aznam Kamaruzaman Sharifah Shazana Syed Salim Agha CONTRIBUTING WRITER

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

ACHIEVEMENT

A N D I N N O VAT I O N

DIRECTOR, RESEARCH & INTELLIGENCE

Abdalhamid Evans

IN THE HALAL MARKET

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

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Today many Muslims are fighting for acceptance into different cultures and lands just to exist. Many more feel inferior due to the negative media portrayal of Muslims in the news everyday. Take a moment to think of the reality of the Halal industry to see a silver lining. One could argue that the concept of Halal is so well accepted by non Muslims that 80% of the global Halal industry is controlled by them. The Halal market is in fact a cross-over market and it is in this crossover that an understanding of the differences can be forged. It is not the first time in history that this has happened. Take the Crusades for example. It was indeed a bad time. But the European interaction with the Muslim world allowed the flow of Islamic ideas that ultimately helped Western Europe out of the mire it was in. Its effects are still visible today. Today, Halal is a universal concept that can be used to improve the food industry. This can seamlessly be achieved with the involvement of non-Muslims. In the ‘Darul Hikma’ concept, Muslim empires of old would get the best minds from across their vast lands, both Muslims and non-Muslims, working together to solve problems faced by the society. This of course lead to the Islamic Golden Age. This is also the critical mass which Malaysia is trying to achieve, with new ideas like Halal food parks, companies establishing Halal centers of excellence and the establishment of the Halal Industry Development Corporation. There is much to be done to realise this, but hj the work has begun.

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ARKET SH

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Mark Piet

GLOBAL M

Crucial Contact ex

Quietly Spoken

GlobalNEWS

EU EXPORTS RISE, BUT GLOBAL MARKET SHARE SHRINKS

Despite boosting exports last year, the EU’s food and drink sector share of the global market continues to shrink in the face of overseas competition, according to the industry association’s annual report. The shrinking export share has led to calls by the association for a greater share of public research and development money, less burdensome regulations and community programmes to reduce raw material prices. In its report released recently, the Confederation of the Food and Drink Industries of the European Union (CIAA) said it will produce this year for the first time a competitive benchmarking report for the sector as a means of getting a better grasp on the issues facing the industry. The association noted that the bloc’s global share of the export market had been falling for the past 10 years, while countries such as Australia, New Zealand, China and Brazil had boosted theirs. Meanwhile exports of EU food and drink products rose in 2004 and continued to grow in the first nine months of 2005, following a slight drop in 2003. In the first nine months of 2005, exports grew by 4.8 per cent, while imports grew by 3.2 per cent. The trade surplus, which decreased substantially in 2003 and 2004, registered a 23 per cent increase in 2005. | SOURCE: FOODPRODUCTIONDAILY.COM, 12/4/2006

MALAYSIA

MINISTRY’S PLAN TO TAG CATTLE WITH MICROCHIPS

JUST like vehicles, cattle in Malaysia will be given registration numbers, under an Agriculture and Agro-based Industries Ministry plan. The microchip-based ID tags will help identify smuggled animals and stem the spread of foot and mouth disease in cattle here. Minister Tan Sri Muhyiddin Yassin said the concept was practised in Australia, where all cattle were ear-tagged with a microchip containing information on the state and farm where they were reared. Radio frequency identification (RFID) technology could be used for this purpose. “Each state will have a code, and each farm its own number, so you can even trace the beef sold in shops down to the farm it came from if any problems arise,” he told reporters after chairing a dialogue with agro-industry players on Halal food at a hotel today. | SOURCE: NST ONLINE, 17/4/2006

MUSLIM TV NETWORK A HIT

A first-of-its-kind Muslim-American television network launched a year ago has gone from being a pay channel to a basic-cable offering on several cable and satellite systems, broadening its reach from 10,000 to more than one million US homes. Bridges TV founder and chief executive, Muzammil Hassan, said the transition in markets including Detroit, Chicago, Boston and Washington meant that viewers, while channel-surfing between Fox News Channel and CNN, are coming across the English-language network. “That completely changes and gives America a completely different and unique perspective that America has never had available before,” Hassan said. Bridges TV produces a daily hour-long newscast. Broadcasts also include current affairs, cooking and travel shows, soccer and cricket matches and sitcoms. As a premium channel for US$14.99 (RM55) per month, virtually all subscribers were Muslims, Hassan said, giving the sense the network was preaching to the choir. However, the network “really fills a void,” said Adnan Mirza, a director of the Council on American-Islamic Relation. “There’s a clear disconnect between American media and the Muslim audience.” “Americans are increasingly interested in better understanding Middle Eastern cultures and Muslim Americans want to be better understood. Bridges TV creates a public platform for this dialogue,” said Mirza. | SOURCE: NEWS STRAITS TIMES, 7/4/06

THE HALAL JOURNAL

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GlobalNEWS It was reported that the complex will handle all activities concerning Halal, including laboratory capabilities that will be able to analyse all ingredients within any given product that seeks JAKIM’s Halal certification. MALAYSIA

INTEGRATED HALAL CENTRE AT TECHPARK@ENSTEK

The Islamic Development Department of Malaysia (JAKIM) plans to develop an integrated Halal Complex at techpark@enstek, the technological hub of the first knowledge-based planned community in Nilai, Negeri Sembilan. It was reported that the complex will handle all activities concerning Halal, including laboratory capabilities that will be able to analyse all ingredients within any given product that seeks JAKIM’s Halal certification. It will also house a Halal institute, Halal administrative centre, a centre of Halal research and development as well as an e-Halal centre, which will oversee all matters related to the implementation of Halal on the virtual platform. The physical work is expected to commence by this year and will occupy an area of 45.5 acres. To be built under the Ninth Malaysia Plan, JAKIM is aiming for the centre to be a reference point for all matters relating to Halal and would be able to help realise the nation’s aspiration to become a Halal hub. | SOURCE: WWW.TH-PROPERTIES.COM, 10/4/2006

AMSTERDAM

AMSTERDAM HALAL FOOD CONFERENCE

The 2nd International Halal Food Conference held in Amsterdam last April drew participants from Europe, India and USA. Speakers were from the Halal authorities of Malaysia, Indonesia,the Philippines and Singapore. Prof Aisjah of MUI Indonesia, who is also the President of the World Halal Council, gave the keynote address on the role the council towards getting uniform Halal standards and a common logo for members to use. Food industry representatives highlighted some of the challenges faced by them primarily in the selection of the right Halal certifying body because not much information is available in the media. There were a total of 16 papers presented in this one day conference. | SOURCE: WWW.HALALJOURNAL.COM

LE T T ERS

LETTER 1 : SERIOUSNESS OF HALAL During the Malaysian delegation’s visit to Australia for fatwa on stunning and thoracic sticking, the Minister’s (Malaysian Agriculture and Agro-Based Minister Tan Sri Muhyiddin Yassin) team was serious about their commitment to Halal. Muhyiddin made it clear to the AQIS (Australian Quarantine and Inspection Service) and the Halal certifiers that were present at the meeting in Perth that there would be no compromise in the Halal processing of cattle in Australia or anywhere else. The team travelled extensively without any rest days to remote areas of Western Australia, Canberra, Perth and Melbourne for meetings with the Australian government officials. What I could not understand was that the other representatives from Halal certifiers, who have been in business for more that 20 to 30 years were giving excuses in regards to stunning. In the end the Malaysian delegates very firmly advised all the Halal certifiers that were present that they had to comply with Malaysian protocol on Halal slaughtering. The trip for Muhyiddin and his team was very extensive and I was there with them till 11:30am in their hotel. They were all awake discussing Halal protocol. Even the Minister himself was wide awake discussing the matter till the early morning hours. This show’s the magnitude of sacrifice he and his team has contributed towards the seriousness of Halal for the sake of ummah. I have to congratulate you and your team for bringing this to the Muslim ummah through The Halal Journal.

Mohamed Rahman Halal Services Manager Australian Federation of Islamic Councils Inc. (AFIC) via email

DUBAI

AL ISLAMI FOODS TO EXPAND

Al Islami Foods, formerly Co-Op Islami, has confirmed its decision to expand beyond the GCC by targeting the global market while consolidating its operations in regional markets. The company will initially enter Iran, an important region which has shown an increasing demand for genuine Halal food, before branching out to Europe and other countries. Announcing this, Al Islami Foods CEO Saleh Abdullah Lootah said the expansion into new markets was critical to the company’s growth and part of its five-year strategic global expansion plan to evolve as an important player in the international processed food industry. Currently, the industry in Iran itself is estimated at $600 million, with annual growth reported at 16 percent. “With the demand for real Halal food products increasing worldwide, Al Islami Foods is well-positioned to enter new regions and consolidate its leadership stature. The expansion process is critical to our business and a continuation of our efforts to meet our aggressive growth goals,” said Lootah. | SOURCE: TRADE ARABIA, 7/4/2006

CORRECTION: In our Mar/Apr ‘06 issue article ‘Views on Gelatine’, the sentence should have read: Based on this ‘irreversible’ factor, Sheik Taj Eldine El Hilaly, The Mufti of Australia as well as the Muslim Judicial Council of South Africa have both issued fatwas allowing the use of all gelatine made from bovine hide source. (Instead of any animal source). The error is regretted.

LETTER 2 : KOSHER SCAM I want to introduce you to the controversy and scams already taking shape in the USA with regard to the kosher market infringing on the growth of the Halal market at the Muslims expense. There are a kosher companies stating openly that their products are kosher but carry both a kosher and Halal symbol. They don’t even try and hide the fact they are kosher yet they are purporting their product is also Halal. This is why we need a global watchdog group that can confront these fraudulent claims. Look at the symbols they use. There is no respected Halal certifier in the country with that Halal symbol, at least none I have ever known. It looks awfully close to IFANCA but it is not. I am going to notify IFANCA so they are aware. These products are not acceptable to be marketed as Halal. Just thought you should know and perhaps this is a perfect chance to address these companies looking to take advantage of the Halal market to further their own. Jalel Aossey Midamar Corporation Via email

10 THE HALAL JOURNAL

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GlobalNEWS MALAYSIA

KFH EYES INDONESIA BANKS

Kuwait Finance House, one of the world’s largest Islamic banking groups, is looking to acquire a bank in Indonesia to tap the world’s most populous Muslim nation and also plans to sell the first ever Islamic bond in China this year, a top official said recently. Salman Younis, executive director of Kuwait Finance House (Malaysia) Berhad, or KFH, said the group intends to secure an Indonesian banking license as part of its regional expansion, but that it has not yet begun talks with any Indonesian banks about a possible acquisition. “The possibility is there to go into a number of countries, Indonesia being one of them. It’s on our minds,” said Younis. In China, Younis said KFH has secured a mandate to structure the first Islamic bond issue, known as sukuk, which will be launched in the next few months to raise US$200 million (Euro162 million) for an infrastructure-related project. He declined to elaborate. “It will be the first ever sukuk issue in China,” Younis said. “The potential in China is large because it is a totally untapped market for Islamic finance. We are also looking at investing in real estate and private equities in China.” The group is already in talks with Chinese provincial authorities about the possibility of funding development projects there, but he said it too early to gauge the success of Islamic finance there. Younis said Arab investors, flushed with liquidity due to high oil prices, are shifting their focus to Asia due the region’s revived economic growth. “Investors in the Gulf don’t want to put everything in Europe and North America. Now they see its time to start coming back to Asia. They are looking at China, Indonesia, Thailand, Malaysia and Singapore,” he said. The Kuwait-based bank is the first foreign Islamic bank to operate in Malaysia. Two others - Saudi Arabia’s Al-Rajhi Banking and Investment and a consortium led by Qatar Islamic Bank are likely to begin operations later this year. | SOURCE: ASSOCIATED PRESS, 20/4/2006

PARTNER EVENT : The Islamic Financial Services Board : by Mujib Miah The Islamic Financial Services Board conference in London recently addressed the need for a development of an Islamic legal framework in dealing with asset securitisation/ sukuk and insolvency. With a growing and settled Muslim community in the UK, and the latest entry into the market of Islamic Bank of Britain and the European Islamic Investment Bank, the conference dealt with technical issues that needed to be bridged between the conventional banking practices and concepts of Islamic finance so that a more diverse Islamic financial offerings could be provided. The two day conference was attended by over one hundred delegates from a variety of financial institutions in the UK as well as leading bankers from Muslim countries in Africa, Asia, and the Middle East. The keynote speech was delivered by Professor Barry Rider, Cambridge University UK, who highlighted the ethical principles underlying the concepts of Islamic finance and its importance under the current international context.

THAILAND

THAI GOVT PLANS TO INCREASE HALAL FOOD EXPORTS

The Commerce Ministry’s Business Development Department of Thailand is drafting a plan to make Thailand a Halal food hub in a bid to secure a share of the global Halal food market, valued at between six to eight trillion baht a year. To formulate the plan, the department, in partnership with the National Food Institute of Thailand, SME Bank and Chulalongkorn University’s Halal Food Science Centre, jointly hosted a seminar titled “Thailand Halal Hub”, which was attended by both state and private sector representatives, said the Deputy Minister of Commerce, Suwit Mesinsee.The Commerce Ministry is also seeking comments and suggestions from the public to ensure the plan is economically feasible. Halal food could be sold from Thailand to Muslim and non-Muslim consumers throughout the world. Thailand exports a total of 400 billion baht worth of food products every year, of which Halal food accounts for 120 – 130 billion baht, Suwit said. Orajit Singkalawanich, director-general of the Department of Business Development, said her agency is working to upgrade and modernise Thai enterprises to meet global production standards. In the food business, the Halal food project is a pilot program of the government’s policy to turn Thailand into one of the world’s kitchens. Thailand is already a major exporter in the world food market, with Thai rice, frozen seafood and chicken products popular throughout the world, said Orajit. Yet all these products, if made according to Halal production standards, could also be sold to Muslim consumers. “Currently, the worth of Thailand’s total Halal food exports remains miniscule compared to the world Halal food market value of six to eight trillion baht annually. Yet not just Muslim consumers but general consumers also eat Halal food. So the Halal food market represents a good business opportunity for Thai food exporters to bring in more export revenue each year,” Orajit said. | SOURCE: THAIDAY, 13/4/2006 12 THE HALAL JOURNAL

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“One problem Islamic financing in the West faced was the shortage of people knowledgeable in Shari’a who were able to help structure complex deals.”

Ashraf Piranie, financial director at the Islamic Bank of Britain

UAE

BIG ISLAMIC BANKS NEEDED - IFSB

An Islamic banking expert has stressed the need for big-sized Islamic banks to meet growing financial requirements in the Middle East and other parts of the world. “There is a need for big-sized Islamic banks. We don’t have the likes of HSBC, Citibank or Standard Chartered,” Rifaat Ahmed Abdel Karim, secretary general of the Kuala Lumpur-based Islamic Financial Services Board (IFSB), was quoted as saying by the Arabic daily Al-Eqtesadiyah. IFSB sets self-regulatory standards for Islamic banking based upon Shariah laws. Islamic banking is largely concentrated in the Middle East and Southeast Asia but it is making inroads into Europe and the United States. With Muslims accounting for 1.6 billion, or 25 per cent, of world population, demand for Islamic finance is booming. But only one Islamic bank in the world ‘Al-Rajhi Bank’ has capital exceeding $500 million, and 10 others with more than $200 million. “Islamic banks must realise that remaining small will not help. They need to grow to be competitive in the market, for better economies of scale and to be able to take on big projects,” Al-Eqtesadiyah quoted him as saying in a report recently. Abdel Karim welcomed a proposal by the General Council for Islamic Banks and Financial Institutions to set up a $1 billion Islamic mega bank, saying it will help boost the industry’s market share in the global financial system. The council has said it hoped to launch the bank next year and is looking at Bahrain, Qatar, Dubai and Malaysia as possible host country. There are 270 Islamic banks with combined assets of $265 billion. “Deposits at Islamic banks are now estimated at $202 billion and are growing at the rate of 20 per cent annually,” he said. Islamic banks have now become a world force. However, the industry was still facing a lot of challenges, especially in matters related to setting up standards for the globalisation of the fast growing sector. Despite the presence of 270 Islamic banks, they account for only one per cent of global banking assets. | SOURCE: ARAB NEWS, 7/4/2006

MALAYSIA

WESTPORTS OFFERS DEDICATED BERTHS TO CHINESE LINER

China Shipping Container Lines Co Ltd (CSCL) is in talks with Kelang Multi Terminal Sdn Bhd, the operator of Westports in Port Klang, to have dedicated berths for the liner and the Malaysian port has offered 600m space, or the equivalent of two berths. CSCL, which started off with 100,000 TEUs (20-foot equivalent units) in Westports six years ago, carried about 500,000 TEUs last year. It is expected to increase its shipment through Westports to 600,000 TEUs this year. Transport Minister Datuk Seri Chan Kong Choy said recently the Malaysian Government is open to foreign equity interest in its ports.Malaysian ports are expected to move up to 14 million TEUs this year, against 12 million TEUs handled last year. The increase will be helped among others by Malaysia’s popularity as a Halal hub and with more import and export activities. Of the total, Port Klang is expected to handle six million TEUs, half a million more than it handled last year. “I have given them the target and they must deliver,” Chan told reporters after the address. He also said he has invited Chinese companies here to explore business opportunities with Malaysian food makers and to use Malaysia’s global name in Halal certification. | SOURCE: BUSINESS TIMES, 12/4/2006

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.

Calendar of events 8-10 MAY 2006 WORLD HALAL FORUM The Premier Global Halal Industry Event Crowne Plaza Hotel Kuala Lumpur, Malaysia EXPORTER’S CLUB Tel: +603 7880 0413 Fax: +603 7880 2817 www.worldhalalforum.org 9-12 MAY 2006 FOOD TECH PAKISTAN 2006 Int’l Food, Equipment & Technology Exhibition Karachi Expo Centre Karachi, Pakistan Tel: +65 6278 8666 Fax: +65 6278 4077 Email: info@cems.com.sg www.foodtechpakistan.com 9-11 MAY 2006 EUROPEAN SEAFOOD EXPOSITION Parc Des Expositions Brussels, Belgium Tel: (207) 842 5504 Fax: (207) 842 5505 Email: customerservice@divcom.com www.euroseafood.com 10-14 MAY 2006 MALAYSIAN INTERNATIONAL HALAL SHOWCASE World’s Leading Halal Trade Expo Malaysian Int’l Conference & Exhibition Centre Kuala Lumpur, Malaysia Tel: +603 2161 0001 Fax: +603 2162 0002 Email: enquiry@halal.org.my www.halal.com.my 17-18 MAY 2006 3RD ISLAMIC FINANCIAL SERVICES BOARD Summit: Aligning the Architecture of Islamic Finance to the Evolving Industry Needs The Phoenicia Intercontinental Hotel Beirut, Lebanon IFSB MALAYSIA Tel: +603 2698 4248 Fax: +603 2698 4280 Email: ibsb_sec@ibsb.org www.ibsb.org 17-21 MAY 2006 THAIFEX – WORLD OF FOOD ASIA 2006 IMPACT Challenger Bangkok, Thailand KOELNMESSE Tel: +65 6396 7181 Fax: +65 6296 2771 Email: r.bay@koelnmesse.com.sg www.koelnmesse.com.sg 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

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between the lines

Signposts Statistics are like the footprints in the desert, which tell you that the caravan has passed through. Like tracks in the rear-view mirror, statistics tell you what has already happened. In today’s fast-evolving Halal market, statistics are scarce and by the time you see them, it may be too late.

IN AN EMERGING MARKET, WHAT YOU REALLY NEED IS AN ABILITY TO READ THE SIGNS. If you are reading the signs correctly, the statistics, when they finally arrive, just give you the finer details of a picture that you already recognise. We are consistently being reminded now that Halal is an integrated farm-to-fork process. It is not simply a matter of a Shariah-compliant slaughtering process, although that remains the market’s essential core and foundation. As the market expands and develops, all the links in the Halal value-chain are expanding and developing correspondingly; any ‘missing links’ will get put in place, and become integrated into the process. Words By HAJJ ABDALHAMID EVANS

WHO IS DRIVING? So what are the drivers that will push the growth of the Halal sector? Let us take a look at some of the forces at work in the retail sector, and see how they affect the entire Halal value-chain. Europe, at its widest definition (that includes Russia) is home to around 50 million Muslims.

European retailing trends are generally driven by Western Europe, home to some 20 million Muslims. The food retailing giants of Europe and the UK are locked into the dynamics of a constant struggle for better margins, bigger market share and higher profits. The bottomline decisions they make often have repercussions that can be felt around the world. Over the past decade, the retail giants have watched the hard discount stores, where the shopper can save up to 25% on the weekly shopping trolley, consistently taking market share away from them. As a result, they have turned their gaze to the neighbourhood convenience stores. Once the domain of the European Mom

and Pop, these stores have become the face of immigrant – and predominantly Muslim – Europe. Pakistani, Kashmiri, Indian, Bangladeshi, Algerian, Moroccan, Turkish, these family-run businesses now sit at the centre the multibillion Halal retail sector in the UK and Europe. However, with 98% of the shopping population already going into the retail chains every week, the supermarket giants have turned their attention to the needs of the Halal customer. Why are they not buying Halal products from the super/hypermarkets? Primarily, because the products are not on offer. Just as a comparison, look at the kosher market in the USA. With a Jewish population

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of less than 6 million, there were a staggering 86,000 kosher-certified products on the shelves in 2004, up 14% from 2002. According to a recent Mintel survey, only 15% of the kosher customers are dedicated Jews running a kosher household. 55% of those surveyed purchase kosher because they believe it to be healthier and safer than regular products. 38% are vegetarian, 24% want dairy-free. As a Mintel spokesperson commented, kosher ‘seems to have equal “bragging rights” with organic and natural.’ The kosher market in the US market alone is worth US$ 190 billion annually. Most significantly, from our point of view, 16% of the US kosher market is made up of Muslim consumers. With only 1,000 Halalcertified products available, most of which are not on the mainstream supermarket shelves, many Muslims are simply buying kosher because they have no other choice. Would they buy the Halal equivalent if it were available? Oh yes, indeed they would, to the tune of around 30 billion dollars. But let’s go back to Europe. VALUE-CHAIN-REACTION With the average western European spending US$ 1,750 a year on food, the EU Halal food market is potentially worth some US$ 35 billion annually. Once the retail giants tuned into Halal, the rules of the market shifted. The old order ended, and a new era was ushered in. Being risk-averse, the big retailers want Halal certified goods, so naturally they came to look in South East Asia, home to the most respected Halal certification agencies in the market, and where you can find, in any average supermarket, not just Halal meat, but all manner of food and non-food items that are certified Halal. And, being risk-averse, the retail giants are looking for a secure and verifiable supply-chain. It is not enough to know that it was Halal at source, and on the shelf. It must be Halal all along the way, in the packaging, handling, storage, road, sea and air transportation. And so Halal logistics is born. Halal logistics demands standards and Shariah-compliant parameters, which in turn pushes the various standards developing agencies to include the logistics sector into the Halal standard. Furthermore, in order for the entire Halal industry to take its place in the global market, the actual process of Halal-compliance has started to undergo a seismic shift. As Halal evolves to fulfill its potential as an ISOequivalent benchmark, the entire process of

Halal certification will itself have to comply with food industry norms, whereby the audit and the certification process are separated. The days of the Halal audit being under the total control of religious authorities is coming to an end. While the issuance of Halal certificates can, and indeed must, remain within their authority, the audit process itself will inevitably become the domain of the industry professionals. Halalcompliance will become a transparent systems-driven procedure, like HACCP, GMP, BRC or EU compliance. And it does not end here. A professional audit will in all likelihood create a market demand for the resulting certificate and logo to incorporate sufficient security features to fend off counterfeit and fraud, which will in turn change the way the packaging industry handles Halal products.

IN AN EMERGING MARKET, WHAT YOU REALLY NEED IS AN ABILITY TO READ THE SIGNS.

As the supermarkets like to carry in the region of 40% of their product line as ‘own label’ products, as they offer better margins, there will also be growth in the Halal contractmanufacturing sector. With cheaper materials and labour, plus better certification procedures, the opportunities for contract manufacturing in the Halal sector in South East Asia are likely to increase considerably over the next few years as the retail giants build up their own Halal lines. Furthermore, Halal products manufactured in Asia will not only find their way onto local shelves, they will also make their way into branches around the world, including the Halal sections of selected outlets in Europe. So, yes, decisions made by food retailers in Paris and London will have a knockon effect in Kuala Lumpur, Bangkok and Singapore, in Melbourne, Beijing, Istanbul and Dubai. They may actually change the way the Halal industry operates. Raw materials from dedicated Halal farms will travel to regional Halal Food Parks with centralised stateof-the-art Halal-certified processing, packaging and cold storage facilities. Products will then be shipped via integrated Halal logistics providers to Halal DistriParks around the world, and finally sold in Halal sections of major retails chains. In the relatively near future, a full product range of professionally audited and certified Halal goods will be securely tracked and traced from one end of the supplychain to the other. And we will, as a convenient by-product, finally get some accurate Halal market statistics. By the time you get to read those, a great many things will have already happened. hj

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MATRADE news

Made in Malaysia for the World The new Matrade News features quality and export ready Malaysian products. Introducing Royal Chef Products and KG Pastry Manufacturing. KAWAN FOOD MANUFACTURING SDN BHD Kawan Food Manufacturing Sdn Bhd forms an integral manufacturing arm of the Kawan Food Berhad Group of Companies. Based in Shah Alam, Selangor, the group is Malaysia’s largest manufacturer and leading exporter of frozen Asian food delicacies. The company is all about providing consumers with authentic and higher quality products, evident in their intensive and continued investment in three state of the art manufacturing facilities. Rigorous R&D activities in both product and manufacturing processes have also made them a global leader in terms of product range within their segment. The world’s first manufacturer

ROYAL CHEF PRODUCTS (M) SDN BHD Established since 1987, Royal Chef Products (M) Sdn Bhd is recognised as a reputable supplier of a wide range of premium food products. Its range of palm oil based food products includes sweetened condensed milk, milk powder, oils and fats and vegetable ghee. These products are manufactured under stringent quality controlled environment to preserve its nutritional values. A wide range of other consumer food products are also available to satisfy the taste buds of different market segments. While West Asia has traditionally been the main market for Royal Chef, the brand today is also recognised in other markets. Royal Chef has been aggressively embarking on expansion programmes to increase its market share in the foreign market. Under the helm of its managing director Sulaiman

of frozen parathas, Kawan Food Manufacturing’s fully automated process flow for producing the parathas has been made possible by the successful adaptation of European technology to specific requirements by an in-house R&D team. Quick freezing technology, essential in providing the highest level of freshness for their products, is also used within their manufacturing processes. All of Kawan Food Manufacturing products conform to the highest global health and food standards, including HACCP and are Halal certified. They maintain strict standards, which also mean constant checks and scrutiny on all ingredients and processes. The company also informs and educates all business partners Daud, the company has successfully established a wide and varied business network over the years. Its proven track record in volume delivery, product variety and excellent quality has placed Royal Chef as the most reliable one-stop food supplier in this region. “Halal products have a large potential to be known worldwide as it also means quality and premium products which can be used by everyone and not only by Muslims. In this regard, MATRADE has always been working hand-in-hand with us by allowing us in trade fairs in foreign markets and giving us the support needed,” said Sulaiman.

company details

Products Manufactured Sweetened Condensed Milk, Milk Powder, Oil & Fats, Vegetable Ghee, Shortening / Butter Ghee, Coconut Products, Pastry & Bakery, Sauces, Mayonnaise. Brand Name Royal Chef Current Export Markets Middle East, Red Sea, Africa, East Mediterranean Future Export Markets Europe, CIS countries (former Soviet Union Republics) Contact Details En. Sulaiman Daud (Managing Director) P.O. Box 11475 50746 Kuala Lumpur Tel: 03-2611 1691 Fax: 03- 2691 3352 E-mail: royalcf@pd.jaring.my / royalcf@streamyx.com www.royalcf.com

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

about these standards. The company’s origin dates back to the 1970s by supplying traditional and homemade pastry products to local grocers and supermarkets. They began exporting products in the mid 1980s, while gaining a steady lead in the local market. In 2000, they established a new manufacturing facility, and have continued to invest heavily in employees and the latest technology ever since. On MATRADE’s assistance for local companies, its managing director Gan Thiam Chai explains, “Matrade has helped immensely especially by opening up more marketing offices worldwide to ensure that many Malaysianmade products get the exposures they need. Other than that, organising international trade fairs and trade missions are also of tremendous help”. “This not only promotes Malaysia’s strengths to produce quality food products but also as a Halal hub with very high standards. MATRADE has also helped by granting brand promotion grants and other forms of funding to help Malaysian companies promote their brands worldwide,” he said.

company details

Products Manufactured Frozen Roti Paratha, Chapatti, Naan, Dhal Curry, Puff Pastry, Spring Roll, Samosa, Croissant, Oriental Buns, Vegetarian Meat Products, Pitta Bread, Baguette Brand Names Kawan, KG Pastry, VEAT, Passion Bake Current Export Markets USA, UK, Kuwait, Jeddah, UAE, The Netherlands, Hong Kong, Japan, China, South Africa, New Zealand, Singapore Future Export Markets: China, India, Indonesia, Korea, Saudi Arabia, Oman, Bahrain Contact Details Mr. Gan Thiam Chai (Managing Director) Lot 20, Jln. Pengapit 15/19 40200 Shah Alam Selangor Darul Ehsan Tel: 603-5511 8388 Fax: 603-5519 3901 Email: info@kgpastry.com www.kgpastry.com

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feature highlights

THE EVENT OF THE GLOBAL HALAL INDUSTRY

ven before it took place, the inaugural World Halal Forum started having a powerful and positive impact in the market. The speaker list alone dispelled any notion that Halal is a minor issue of religious dietary requirements for Muslims. The range of participation demonstrated the breadth and depth of the Halal market. The World Halal Forum has opened the way for

THE WORLD HALAL FORUM 2006 PROGRAMME

“THE GLOBAL HALAL MARKET – AN INDUSTRY PERSPECTIVE” MAY 8-10 2006 KUALA LUMPUR, MALAYSIA

SESSION 1: GLOBAL HALAL MARKET ROLE PLAYERS Hajj Abdalhamid Evans Director, KasehDia Malaysia (Global Halal Market Update) Badlisyah Abdul Ghani Group Head, Islamic Banking Division, CIMB Group Malaysia (Islamic Banking & the Halal Market) Ahmed Hariri Regional Director, Islamic Development Bank Daud Abdullah Managing Director, Hong Leong Islamic Bank SESSION 2: HALAL MEAT & POULTRY, THE HALAL MARKET’S CUTTING-EDGE ROLE PLAYERS Rashid Kadimi CEO, Processed Foods, Allana Group India (India’s Role in the Halal Beef Market) Professor John Edwards Dean of Veterinary and BioMedical Sciences at Murdoch University, Perth, Australia (BioSecurity in Halal Beef Industry)

Bahri Ouzariah Export Director, IDENA Nutrition Animale, France (Developing Animal Feed for the Halal Industry) Dato’ Dr. Mohd Nordin Bin Mohd Nor Technical Advisor, Prima Agri-Products (Ideal Halal Production Model) Mohamed A Rahman Halal Coordinator, Australian Federation of Islamic Councils (AFIC) SESSION 3: THE HALAL FOOD MANUFACTURING SECTOR ROLE PLAYERS Sullivan O’Carroll Managing Director, Nestlé Malaysia Berhad (Developing a Halal Centre of Excellence) Dato’ Ibrahim Badawi Chairman, LSG Sky ChefsBrahim’s (Halal Food for the Airline Industry)

the emergence of a new market paradigm – the Halal market economy. It is a market not defined by geography or product, nor by age or race – but by moral and ethical values. Halal represents a fresh, non-confrontational face of Islam to the world; and the world is responding. Halal is the only arena in which the non-Muslim world has said to the Muslims, “Show us how to do this and we will follow,” and it represents an exceptional – and indeed

unique – opportunity to develop a market arena that actually embodies real market values, rather than just giving them lip-service. The challenge for the global Halal industry will be to convert the challenges and issues that have arisen in the first year into the actions that will drive the development of the industry. The World Halal Forum is likely to be the catalyst for this to take place.

OPENING AND KEYNOTE ADDRESS by Malaysia Prime Minister Dato’ Seri Abdullah Haji Ahmad Badawi

KEYNOTE ADDRESS by Khairy Jamaluddin The World Halal Forum Chairman

Muhammad Hakim See General Manager, Cargill Palm Products Sdn Bhd

Captain Kees Weststrate Senior Business Development Manager, Port of Rotterdam (The European Halal Gateway)

SESSION 4: FAST FOOD & SUPERMARKETS ROLE PLAYERS Dr. Habib M’nasria Quality Assurance Director, McDonalds Middle East & Africa (Halal in the Fast Food Sector) Mr Terry Babbs Tesco Plc, International Trading Law and Technical Director (Halal Food – A Supermarket’s Perspective) Bill Aossey President, Midamar Foods, USA Shafie Shamsuddin Managing Director, Carrefour Malaysia & Singapore

Saleh Abdullah Lootah Chief Executive Officer, Al Islami Foods, Dubai (Developing a Halal Brand for Global Markets)

SESSION 5: HALAL LOGISTICS ROLE PLAYERS Tan Sri Datuk G. Gnanalingam Executive Chairman, Westports (The Role of Ports in the Halal industry

Dato’ Dr. Hj. Kardin Bin Haji Shukor Director, Dindings Poultry Processing Sdn Bhd

En Hilmi Mohd Nashir CEO, MISC Integrated Logistics Sdn Bhd (MILS) (Logistics in the Halal Industry)

Syed Mohamed Syed Ibrahim CEO, TH Properties Sdn Bhd SESSION 6: THE ROAD AHEAD ROLE PLAYERS Dr. Winai Dahlan Director, Halal Science Centre, Chulalongkorn University, Thailand (Halal Science) Dr. Mohamed Sadek Vice President, Islamic Food and Nutrition Council of America IFANCA, USA (Halal Certification in the International Market) Alain Marchand Director, SICPA Holding SA, Switzerland (Securing & Protecting Halal Brand Equity)

FORUM RESOLUTION by Khairy Jamaluddin The World Halal Forum Chairman

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feature highlights

MIHAS 2006

SET TO BE BIGGER AND BETTER

he third Malaysian International Halal Showcase this year (MIHAS 2006) promises an even bigger and better participation targeting well over RM200 million in sales throughout the five-day event. Slated for May 10 – 14, MIHAS 2006 will be held at the Malaysia International Exhibition & Convention Centre (MIECC) at the Mines Resort City in Kuala Lumpur, Malaysia. Deputy International Trade and Industry Minister Datuk Ahmad Husni Hanadzlah said that MIHAS, already the world’s biggest exhibition of Halal products and services, should easily surpass last year’s sales figure based on a more aggressive business matching and trade facilitation programmes. “Last year, MIHAS generated a total of RM217.1 million in immediate sales, with more done even after the event had concluded. So we expect this year’s sales to be not less than RM200 million,” said Ahmad Husni when updating the media recently. Aside from immediate sales, under negotiation sales amounted to RM12.8 million. The increase in sales last year was a direct result

of over 750 trade meetings and 93 international inbuying missions organised by the Malaysian External Trade Development Corporation (Matrade), according to Ahmad Husni. “More than 400 participants from 20 countries are expected this year including those from Iran, Thailand, Indonesia, India, United States and Malaysia. MIHAS is also expected to draw more participation from the Organisation of Islamic Conference’s countries,” he added. Ahmad Husni, who is also the MIHAS’ executive advisor, added that they are expecting more than 500 booths at the event this year, up from 425 booths last year. He noted that while 80 per cent of these participants are involved in the Halal food sector, MIHAS 2006 will see more participation from the non-food Halal sector, such as pharmaceuticals, financial services, government agencies and researchbased institutions. Prime Minister Datuk Seri Abdullah Ahmad Badawi will

MIHAS 2006 WILL SEE MORE PARTICIPATION FROM THE NON-FOOD HALAL SECTOR, SUCH AS PHARMACEUTICALS, FINANCIAL SERVICES, GOVERNMENT AGENCIES AND RESEARCH-BASED INSTITUTIONS. be officiating the launch of this year’s MIHAS, which is aptly themed ‘Networking, Consolidating and Energising the Global Halal Market’. Since its inception in 2004, MIHAS has not only placed itself as the world’s largest and most important Halal exhibition, it also has the potential to augment global businesses looking to capitalise on the growing global Muslim population. “We have positioned ourselves as the most important trade expo for the Halal industry. Last year’s MIHAS was very encouraging and the good turnout from last year has enabled us to

plan for a bigger and better event this year,” said MIHAS’ chief executive officer Mohd Shukri Abdullah. Based on the past two years’ experience, MIHAS has refined the lines of organising the exhibition by including more trade matching, business talks and presentations, networking opportunities, industry presentations and more a personalised attention. With their own insights and vision for a bigger and friendlier MIHAS, Shukri expects this year’s event to bring more benefits and profits for those directly exposed to the goals of Halal certification. “MIHAS has assumed the leadership position and the role of bringing together an international community. It has also enabled Malaysia to assume a leadership position in Halal, providing the impetus for those who are keen on moving the Halal frontiers,” Shukri added.

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The Halal sector can potentially go mainstream in United States’ local food industry. It only needs to take stock and learn from the development of its neighbour – the American Kosher industry.

Words By KAMARUL AZNAM KAMARUZAMAN

Halal, Kosher and theUSA Halal and Kosher

are two faith-based food markets that actually have much in common in terms of acceptable practices based on the tenets of each religion. Kosher however, has one distinct edge – it has managed to build a staggering number of Kosher certified products. With a Jewish population of less than six million in the USA, the local Kosher industry has developed well over 86,000 Koshercertified products. Comparatively, at over eight million, the Muslim population in America is substantially greater in number to the Jews, but only 1,000 Halal-certified products are currently available in the market, many of which are not on the major supermarket shelves. Interestingly however, most of the growth in Kosher has actually come in the basic mainstream foods segment, such as cookies, chocolate confectionery, snacks, sugar confectionery and crackers – items that are not part of the traditional ethnic Kosher food like gefilte fish, matzoh, schav and borscht.

Undeniably, much has been done by the industry to instil this awareness among American consumers, to the extent that even some Muslims are resorting to buying Kosher for the lack of quality Halal food available in the mainstream markets.

In fact, “ethnic Kosher foods are so low that it is extremely difficult to track them,” said a Mintel market research report on the development of Kosher in the U.S. It added that while the overall “mainstream kosher” market, including fresh and processed foods accounts for more than USD100 billion in sales, these sales may not be indicative of the ‘market’ for kosher foods, since the majority of consumers buy these products not because they are Kosher, but for some other reason. The main reason it said, is the perception that Kosher labels convey a sense of quality and hygiene. Undeniably,

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“Second and third generation Halal consumers want more choices, and we notice that they are more loyal to stores and Halal brands than the average non-Halal consumers. This may be due to religious affiliation of the products they purchase.” much has been done by the industry to instil this awareness among American consumers, to the extent that even some Muslims are resorting to buying Kosher for the lack of quality Halal food available in the mainstream markets. As it is, 16 per cent of the Kosher market in America is made up of Muslim consumers. But according to research done by Iowa-based Halal food supplier and distributor Midamar Corporation, 92 per cent of American Muslims admitted that they would purchase Halal products exclusively if more were made available. Getting products Halal-certified is actually not a difficult process. By getting products reviewed by Halal industry experts, local and global manufacturers are getting the assurance that their ingredients, preparation, processing, hygiene and sanitation procedures meet not only the Halal standards, but also ensures that it is consistent with HAACP and other established quality assurance standards. Most importantly, it gives them access to the vast Muslim market, both in United States and globally. The Islamic Food and Nutrition Council of North America (IFANCA) for instance, a leading Halal-food certification organisation in America, has its Halal certificate recognised worldwide, including Europe and North and South America, Indonesia, Malaysia, Singapore, Saudi Arabia, the UAE and the rest of the Middle East. As a Mintel spokesperson said, “More companies realise that when they refurbish a manufacturing plant or update a recipe, they might as well get Kosher certification because it is easier to do and it grows the market.” Similarly, Halal manufacturers, not just in the US but all over the world, can learn from this development. With Muslims making up approximately 25 per cent of the world population, the global Halal marketplace is too lucrative a market for manufacturers to ignore. Within the United States alone, the increase of Muslim immigrants from Iraq, Somalia, Sudan, Bosnia and the Middle East are inadvertently pushing Halal into the mainstream. “The eight million Muslims living in the United States today have created the single greatest demand for Halal food in a Western society outside of France. The double digit growth for Halal food in this country is a result of six major events over the past 15 years and this upward trend will continue to drive the demand for Halal in the years ahead,” said Jalel Aossey, director at Midamar Corporation of Iowa. Islamic Services of America, another leading

US Halal certification body recognized globally, including in Malaysia, estimates that the US market for Halal foods will continue to grow at a rate of 25 to 30 per cent over the next five to seven years. Midamar meanwhile, projected that Halal consumers purchase approximately USD12 billion food products each year in the US alone. This huge demand is actually reshaping the buying trend of Halal consumers who want more variety, convenience and of course, easy access to Halal products. “Halal consumers prefer to purchase in more than the traditional ethnic store

carrying Halal products. “And Halal is not just exclusive to the Arab population, it is also purchased by nonMuslims, who come from many backgrounds and ethnicities, be it Jews, Asians and even natural and organic consumers. The bottom line is, Halal adds more dollars to the average grocery receipt,” he added. Needless to say, the Halal market is well on its path in becoming the most important category in global food development. The United States’ widening trade deficit could readily be a key beneficiary if major American food manufacturers would start to consider certifying their products as Halal and start tapping the vast potentials of a global Halal marketplace. “The retail food industry is already taking notice,” Jalel added. “Companies are

Expert’s Opinion

To integrate Halal into the mainstream American food market, Midamar offered some pointers, based on their experience in manufacturing and distributing Halal food within North America and around the world. The main factor to market Halal is to know the consumer’s demographics. “Halal is most successful in areas where key demographics point to a present or growing Muslim population,” Jalel said. “Look for signs of a Muslim community. Islamic centres, mosques, colleges or campuses often provide a strong demand for Halal food.” Another factor concerns the stores that would carry the Halal products. “Halal products are most successful in stores that dedicate a specific section to the category as a whole,” he added. Point-of-sale materials, including the display of Halal certifications, also aid greatly in building the excitement and focus on the Halal category to the customers. setting,” said Jalel. “Second and third generation Halal consumers want more choices, and we notice that they are loyal to stores and Halal brands than the average non-Halal consumers. This may be due to religious affiliation of the products they purchase.” He added that the average Halal consumer will also purchase additional groceries and supplies from stores

establishing programs and test markets for introducing and implementing a Halal category at the store level. Companies looking to be an industry leader will have the vision to introduce Halal products for customer satisfaction and retention. The end result is earning your customer’s trust, ongoing loyalty and of course increased sales and profits.” hj

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Initially just a convergence of common interests that were shaped by the dynamics within each sector, the symbiosis of Halal initiatives and Halal funding is expected to create a hybrid effect, one that will further strengthen the natural alliance between the two industries and ultimately promote a stronger, more robust global Halal economy.

Words By KAMARUL AZNAM KAMARUZAMAN

Halal+Islamic Finance

=Halal Economy?

alal businesses and Islamic finance have integral roles to play in the development of a strong Halal economy. This new idea ensures Halal-related businesses are indeed ‘100 per cent Halal’. Islamic source of funds also promote the growth of a global potential that is, in reality, in dire need of Muslim entrepreneurs. “To ensure that the whole production process is Halal, the source of the financing should also be from a Halal source, i.e. using Islamic banking services,” said Daud Vicary Abdullah, managing director of Hong Leong Islamic Bank. It is after all, what Islamic finance is all about – promoting justice and equity in transactions while abandoning usury. Islamic banking’s concept of sharing risks and returns could protect a fledgling Halal business, while it simultaneously nurtures the growth of the Halal industry. Badlisyah Abdul Ghani, head of CIMB Islamic Group said, “Halal businesses cover a wide span of economic activities, from farming to manufacturing and processing of food, from selling food in stalls by the roadside to the import and export of commodities between nations, from car manufacturing to infrastructure building.”

“These activities rely substantially on the financial market to facilitate their transactions, and Islamic banking and finance industry is the only natural ally to all types of Halal activities,” he added. Considering that the market size of total loans in Malaysia is worth well over RM560 billion as of February 2006, Islamic financing is indeed capable of capturing a significant percentage of that market. As it is however, Islamic financing represents only 12.1 per cent of total loans in the Malaysian banking system. The Malaysian central bank, Bank Negara has targeted that figure to increase to 20 per cent by 2010.

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When one considers that the Muslim population in Malaysia is about 15 million, and 20 per cent of that would be the acceptable percentile for young and able Muslim banking consumers, a question arises: how long more until saturation point is reached? University of Marburg president Prof Dr Volker Nienhaus provides the answer. “This ambitious target requires the conversion of customers from conventional banking to Islamic banking. It must be able to react on technical, conceptual and human resource needs of the Islamic finance and have the potential to anticipate forthcoming issues.” Readily, the issues are aplenty. Halal funding in reality is actually small in potentially lucrative Halalrelated sectors. Although no exact figures are available, guesstimates indicate that only 30 per cent of the RM71.5 billion total Islamic loans in Malaysia are actually being used by businesses in potential Halal sectors.

n Malaysia, the manufacturing sector uses the most of Islamic loans; with February 2006 figures amounted to RM7.7 billion or 10.7 per cent of the total Islamic financing. Wholesale, retail, hotels and restaurants formed RM3.6 billion (5 per cent) while agriculture, forestry and fishing constituted RM2.4 billion (3.2 per cent). Minus the non Halal-related businesses and these percentages should significantly be much lower. Compare the end figure with the potentials that exist within a full blown global Halal economy and it suddenly becomes clear that Malaysia must work very hard to raise its share within the global Halal industry. Once sorted however, the potential within it is truly immense. The world Muslim population in 2006 is estimated to be 1.6 billion. If every Muslim spends just USD1 a day on Halal food, the total would come up to USD584 billion a year. Malaysia currently controls less then one per cent of this figure, 80 per cent of which is currently owned by non Muslims. In fact, one of the main reasons for the slow take-up rate of Islamic funds for

“Halal financing limits the possibility to expand beyond our means. We are limited by our own capacity, expanding only with what we have and what the bank is comfortable in providing. When you are framed by this limitation, you can say that using Halal financing actually removes carelessness and greed by not rushing for the big bucks” Halal initiatives is the fact that the Muslims themselves, who should be making up the core of Islamic finance customers, are unaware of the potentials, hence staying away from any Halal venture. This lucrative void is then replaced by the non Muslims, who make up the majority of Halal food manufacturers in Malaysia. While some note that the non Muslims are not seen as proactive enough to ensure full Halal compliance from every angle of production, including their source of funds, others are more receptive. “At present, is it estimated that 80 per cent of the domestic market share of Halal foods and products is dominated by non Muslims manufacturers,” noted Muhammad Hisyam Mohamad, a fellow at the Malaysian Islamic Understanding Institute’s (IKIM) Centre for Economics and Social Studies. “It is a paradox that such Muslim concerns are being capitalised on by non Muslim businessmen. By right, Muslim manufacturers should lead the industry to grab any available opportunities and make the most profit from Halal goods.” Sarah Joseph, editor of emel, a UK Muslim lifestyle magazine said “Personally, I welcome all products which benefit the Muslim community and facilitate their needs. There are those who worry about the authenticity of Halal products produced by non-Muslims, and there is a concern that if large companies use their buying powers this will adversely affect small Muslim businesses. We need to work through these issues and not

ignore them, but I feel that these are not insurmountable obstacles”. If one needs convincing on the benefits of funding Halal with Halal, consider Malaysian-based Alami Group as a prime example. Starting from manufacturing rubber products and exporting electronic instruments in 1987, the group has since successfully diversified into other areas, including commodities, downstream vegetable oils, telecommunications, travel, instrumentation, building of marine vessels, even water resource management, using solely Islamic financing. Alami Group’s managing director Radwan Alami explains his reasoning behind this: “I think that regardless of whether in business or in life, Muslims should always seek the right path. We have been prohibited to seek what is damaging, so I believe in that.” “I also realised that Halal financing limits the possibility to expand beyond our means. We are limited by our own capacity, expanding only with what we have and what the bank is comfortable in providing. When you are framed by this limitation, you can say that using Halal financing actually removes carelessness and greed by not rushing for the big bucks,” he added.

ith the Malaysian government currently pushing for both Islamic banking and the Halal industry, further collaborations and ‘cross pollination’ between these two sectors are likely to become

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lia

increasingly widespread. “Yes, of course there will be more collaboration between the two as more SMEs that are going into the Halal industry will look for Islamic banking for their funding needs. There is a natural partnership. Both have their standards which can be deemed as a trademark,” said Mr K. Salman Younis, executive director of Kuwait Finance House (Malaysia) Berhad. On the situation in the UK, Ms Joseph of emel said “There is a widening in understanding of the term ‘Halal’ as Islamic awareness increases. Finance products are now beginning to be grouped into the Halal market: ‘Halal financial investments,’ ‘Halal loans’ etc. And I believe that this trend will grow”. As Islamic banks begin to understand the Halal industry better, increased collaboration will increase the availability of Halal funds within the local Islamic banking system, which in turn, will increase the number of Halal-related businesses, which will then compete to produce better and cheaper Halal products.

“We will see a big increase in the Halal business, due to the availability of funds for financing from Islamic banks. And due to the huge potential and demand for Halal-related businesses, more people will take the opportunity to venture into this (Halal) business,” Salman added.

inally, if the relationship between the two sectors blooms stronger as what is starting to happen in Malaysia, Islamic banks with international presence such as Kuwait Finance House and CIMB Islamic will want to implement a similar model within their global boundaries. “KFH is here to complement the products and services provided by the local Islamic banks. Should the Malaysian branch learn

something new, yes, we will of course implement it in other branch openings,” added Salman Younis. Developments in the Halal industry are also expected to spur development in other Halal market neighbours. “There is also a developing trend to look at the ethical background of products to see whether they are in the spirit of Islam not just within the law, for example organic products, ethical investments, environmentally friendly products, etc,” added Ms Joseph. The end result would be a win-win scenario for all parties involved - the Halal marketplace, the Islamic banking sector and the Halal consumers, even Halal market neighbours; simply by hj funding Halal with Halal.

With the Malaysian government currently pushing for both Islamic banking and the Halal industry, further collaborations and ‘cross pollination’ between these two sectors are likely to become increasingly widespread.

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Port of Rotterdamâ&#x20AC;&#x2122;s

Halal Venture Europeâ&#x20AC;&#x2122;s largest port is planning for a European Halal Distribution Centre. The Halal Journal met with Captain Weststrate of Port of Rotterdam on their preparation for a European Halal gateway.

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s the Halal market continues to expand, the integrity of the supply-chain becomes an increasingly important issue. With major stakeholders at both the production and retail ends of the supplychain, the logistics sub-sector is naturally emerging as one of the most rapidly developing links in the Halal value-chain. While Malaysia’s Westports and MISC Integrated Logistics are taking a joint pole position in South East Asia’s Halal logistics arena, The Port of Rotterdam has stepped into the global picture with their plans for a European Halal gateway. In meeting the growing demands for Halal food products, the major players are likely to demand the strictest compliance to the rules of Halal from every angle, including transportation. Full ‘farm-tofork’ Halal compliance will require a secure supplychain, with the ability to track where the product has been, from the point it leaves the manufacturing plant right through to the supermarket shelves half way across the globe. “That is what we can readily deliver right now,” Captain Kees Weststrate, senior business development manager for Port of Rotterdam told The Halal Journal. “How do you know when you send a product to Europe in a container, that there are no swine-related items in there? Based on our experience, we have found solutions for this. You have to have a special kind of steering or tracking device for containers, and also for ships and air-freighters.” WITH THE REALISATION of the prospects of a global Halal marketplace, Rotterdam is now positioning itself as the gateway into Europe for Halal

“If you look at containers and all other trades around the port, it is all coming via water in big ships and is then distributed via Rotterdam. So, we realise that this is actually our very own market.”

products. Weststrate revealed that the Port of Rotterdam Authority is in fact in co-operation with other market parties including the Hecny Group and Vat Logistics to offer Halal supply chain solutions with full Halal certifications. “If you look at containers and all other trades around the port, it is all coming via water in big ships and is then distributed via Rotterdam. So, we realise that this is actually our very own market. To confirm this, we made a market study, found a few interested partners and we have even found investors who are willing to invest. To me, this confirms

our notion that the Halal sector is actually a very big market,” he added. One of the aims, according to Weststrate, is to realise the establishment of a dedicated warehouse for Halal products, which can also function as a European Halal Distribution Centre. To be located within the Distriparc Maasvlakte area, one of the three concentration zones for distribution and value added logistics, the park will be situated adjacent to the large deep-sea container terminals of ECT (European Container Terminal) and APM, including a specialised terminal for intraEuropean shipping. The terminals and DistriPark are then connected by a dedicated bonded track. One of the world’s most important hubs for cargo, Port of Rotterdam’s throughput in 2005 was 370 million tonnes of goods, including almost 10 million (TEU) containers. Located on the North Sea - the busiest sea route in the world - the port and industrial area extends over 40 kilometres in length, covers over 10,000 hectares and serves its European hinterland of around 380 million consumers. Some 35,000 sea-going vessels and 135,000 inland vessels arrive at the port every year. Rotterdam is the home port and port of call for about 500 shipping lines, running regular services to more than 1,000 ports. It is also Europe’s most important port for oil and chemicals, containers, iron ore, coal, metals as well as food products. IN 2005, throughput of food at the Port of Rotterdam was approximately 30 million tonnes, 60 per cent of which was destined for use in the Netherlands and

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“The port its European hinterland. In addition to agricultural raw materials, beverages, meat, fish, preserves, grain products, fruit, vegetables, fruit juices and edible oils such as palm oil are also handled and processed within the port area. Based on this extensive experience with food, a very extensive sector of service providers and quality control has grown. Furthermore, the “economies of care” provided by Rotterdam is also supported by the strong environmental consciousness within the Rotterdam region. As a result, the majority of goods are transported by inland barges and pipelines to minimise environmental pressure. The further central European hinterland is served by frequent shuttle transportation. Serving a market of over 400 million people where demand may change every 300 kilometres, Port of Rotterdam is also banking on the growing Muslim population within Europe to realise their regional Halal vision. In the Netherlands alone, the Muslim population represents an annual meat consumption of approximately 100,000 tonnes. This is also reflected in supermarkets, hotels, restaurants, institutions and caterers, where Muslims are increasingly insisting on a full range of Halal products. “To come to this conclusion, we did a little market study and found that the Islamic population in and around us is really big and is continually growing. Up to 30 million Muslims currently live in Europe, with over a million in the Netherlands and about the same in Belgium; Germany has four and half million, England around two million, and France about five million. And it is all in our hinterland, which is the market we

management sees the Halal products market as a high-potential segment, not just size of the market and the growing demand for Halal products. It will also attract related, value-added activities, such as Halal certification and more processing standards.”

are serving today. That makes it fairly interesting because we are already the gateway to Europe,” explains Weststrate. WITH AN AVERAGE food expenditure of around USD1,500 per capita annually, the European Muslim population of 30 million represents a substantial USD45 billion market. With the retail giants actively pursuing the Halal consumer, and planning to offer them a full product range, the volume of Halal products flowing into Europe is likely to increase. With both the number of consumers and the demand for Halal products expected to grow, Port of Rotterdam’s

excellent geographical location as a doorway into Europe and the improving trends of Halal consumption even amongst the non-Muslims all helped to contribute to port’s staunch commitment for a strong Halal industry. “The port management sees the Halal products market as a high-potential segment, not just size of the market and the growing demand for Halal products. It will also attract related, value-added activities, such as Halal certification and more processing standards. Further possibilities for consolidation of flows and activities like clustering will also arise and this will give definitely give us the distinctive competitive advantage as compared to other ports that focus less on this segment,” said Weststrate. The strong push for Halal sector by the Malaysian government is also one of the reasons why Port of Rotterdam is confident of setting up the vision. “We have met the Chairman of Port of Rotterdam’s supervisory board and gave him a number of future points of interest. One of the seven points was the Halal development in Malaysia and the impact that it will play in a global Halal marketplace. Now what is important is the name of Malaysia being a reliable partner, and also the name of Port of Rotterdam being a reliable partner,” added Weststrate. There seems to be little doubt that as the Halal market continues to evolve, the emergence of Halal logistics will be matched by more developments in other sectors of the supply chain. Certainly, the demand for Halal logistics will have some spin-offs of its own, such as the need for more specific standards to determine the parameters for Halal compliance within the logistics sector. hj

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European Retailers Go Halal

With today’s higher cost of living and stiffer competition, Europe’s food retailing giants are seeing smaller margins for every trolley the customer carts away. Faced with lower turnover and even lower growth rate, European hyper and supermarkets are forced to look for new hunting grounds; and the prospects of a global Halal marketplace has got their attention. Words By KAMARUL AZNAM KAMARUZAMAN

ith over 30 million Muslims now living in Eastern and Western Europe and growing at a higher rate than average, the Halal demand within the region is too big to be ignored. Europe today is truly a melting pot of different ethnicities, tastes and cultures with Turkish, Indian, Pakistani, North African, Arab, Bosnian, Asian and even Europeans making up the regional Muslim population. Now into its second and third generation of Muslim immigrants, the European Halal market, often regarded as a minor subset of the general food market, is increasingly being recognised by industry observers as the next retail goldmine. Several trends are currently at work in this regard. French retail consultant Jean Prevost reported that, while 2004 turnover figures indicate that both the hypermarkets and supermarkets commanded well over 85 per cent of France’s retail turnover, it also pointed to a significant deceleration of growth over the past five years for both retail segments. Hypermarkets in France recorded just 0.8 per cent growth in 2004, a paltry figure compared to an average of 2.8 per cent growth over the past five years. Supermarkets fared even worse, recording a negative growth of -0.3 per cent in 2004. This trend continued well into the first quarter of 2005, with both segments recording negative growth values. Interestingly however, hard discount stores, once regarded as outsiders within Europe’s food retail industry, are beginning to exert their dominance within the French turf. In 1980, hard discounts were not even in existence, but 24 years on they now command 10.6 per cent of the total retail turnover. Hard discount stores such as Lidl, Leader Price and Aldi have recorded impressive growth within the last five years, flourishing at nearly 10 per cent on average annually.

The same can be said throughout much of Europe. Hard discount stores are recording meteoric sales growth of over 80 per cent within the last 10 years. In 1991 for example, the segment recorded a €40 billion in sales. By 2003, the figure jumped to €94 billion, with 40 per cent increase recorded in affluent Germany, and total hard discount sales are expected to grow to over €114 billion by 2007. Prevost’s report also highlighted the reduction in market share for French convenience stores, which shrunk drastically by 26.8 per cent over the past 24 years. Despite this however, it was interesting to note that most neighbourhood convenience stores are now immigrant owned and run, serving Halal meats to the local communities. In fact, 80 per cent of Halal products are still being sold through traditional distribution channels with over 3,000 Halal butcher shops available throughout France, and this reflects the

situation in the rest of Europe. This vital link forms the core of the European Halal retail market. “The Muslim population of Britain have to rely on small shops to purchase Halal meat, which is an essential practice in their religion,” said a report published by Parliamentary Small Shops Group, an influential cross-party group of British MPs. Taking a cue from this, hypermarket’s marketing experts are devising longterm strategies to counter the onslaught from hard

“THE MUSLIM POPULATION OF BRITAIN HAVE TO RELY ON SMALL SHOPS TO PURCHASE HALAL MEAT, WHICH IS AN ESSENTIAL PRACTICE IN THEIR RELIGION,”

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Demanding Situation Market studies have also indicated that the second and third generation European Muslims are becoming more polarised in their lifestyle and attitudes, and are demanding more Europeanised Halal meals and processed foods, the likes of Halal-certified pizzas, lasagnes and other traditional French meals. They also want a more comprehensive Halal-certified product offering, including drinks, personal care products and health supplements on the supermarket shelves. discounters. Simply slashing down prices is not the answer. Developing ‘private labels’ – multiple ranges of products carrying their own brand name but manufactured by third party contract manufacturers – will also be of main concern to the supermarkets and hypermarkets. Since the price differential between private labels and manufacturer’s brands is nearly 30 per cent, this renewed focus easily translated into better margins for the retail giants. Immediate success was therefore recorded. Thanks to low prices and excellent range development, private labels in France have recorded a 4.2 per cent growth in their first year on the shelves, contributing some three per cent to the hypermarket’s sales figure in 2001. More importantly, it was also decided that these hypermarkets will be concentrating on the fresh produce segment, ready-to-eat meal dishes as well as exploring for new niche market

sectors. Apart from ethnic, organic and fair-trade items, European supermarkets and hypermarkets are waking up to the potential of Halal as a main sales generator. The rationale behind this is clear. Tony Fowler, senior economic analyst for MLC reports, “In the last five years the minority ethnic population of Great Britain has grown by 15 per cent compared with an increase in the white population of only one per cent. The minority ethnic population is predicted to double in the next 50 years and by 2011, ethnic minorities will make up the majority in half of the London boroughs.” Assuming the 30 million Muslim EU population spends an average of USD1,500 per head annually on Halal foods (or USD4 a day), Europe’s Halal food market could potentially be worth USD45 billion annually. Factor in the emergence of a strong Muslim middle-class possessing increasing disposable income, bigger household size and spending more than average per capita on food, the end figure is potentially significantly higher. Fowler went on, “Bangladeshis and Pakistani consumers in the UK have the highest household sizes, at 4.7 persons and 4.2 persons respectively. The average white household has 2.3 inhabitants. The fact that these households are larger has implications for food pack sizes and types of product bought. One example of larger pack sizes developed to cater for such households is the sale of rice in 10kg sacks or barrels.” The report also indicated that while they still visit the local convenience stores for Halal meats, 95 per cent of these European Muslims still shop for other groceries at their local supermarkets and hypermarkets out of convenience and variety. Realising this, French hypermarkets have begun addressing their demands by dedicating a highly visible Halal area within their stores. Prevost reported that beginning 2006, a number of major supermarkets and

PART OF THE MAIN OBJECTIVE OF THIS EXERCISE, IS TO INSTIL THE PERCEPTION THAT SUPER/HYPERMARKET IS REALLY THE PLACE TO FIND TRUE HALALCERTIFIED PRODUCTS. hypermarkets in Paris will begin establishing 400square metre Halal sections within their stores. The main objective of this exercise, apart from commanding a higher turnover volume, is to instil the perception that super/hypermarket is really the place to find true Halal-certified products. Retailers will be banking on more specific strategies to educate the Halal buyers, both Muslims and non Muslims, by giving them a sense of security in Halal foods. They will also be using techniques to increase customer loyalty and to focus more on in-store point-of-sales promotions on the benefits of Halal. To stock up their dedicated Halal shelves, these French retailing giants will also be sourcing for Halal-certified products from South East Asia – respected authorities in Halal-certified food and non food products. Being riskaverse, the retails giants will also be looking for a secure, verifiable and traceable supplychain system, triggering the demand for the development of Halal logistics services. The success of the French hypermarket’s Halal retails exercise will undoubtedly provide a clear signal to the world that: a) Halal is well on the way to becoming a mainstream market segment in Europe’s retail industry, b) Halal development in Europe will have a positive global economic impact, especially within South East Asian countries, and c) ensuring a verifiable Halal delivery will give birth to a new, and potentially lucrative market spin off – Halal logistics. As they say, where there is demand, supply hj will surely find its way.

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MARRYBROWN: GOOD CHOICE FOR GOOD TASTY FOOD

MARRYBROWN is Malaysia’s largest homegrown fast food chain offering a wide choice of tasty and freshly cooked meals at affordable prices. Some of the delicious meals featured include crispy and juicy fried chicken, burgers, seafood, spaghetti, satays, salad and rice-based items. The cozy outlets on the other hand provide for a fun eating-out experience for the whole family with its fresh and contemporary look that is visually attractive to the entire family and equipped with a children’s play section -- and the food, served fast and friendly. Since it was established in 1981, Marrybrown has grown to be a popular quality brand that upholds its ‘Good Choice Good Taste’ motto. There are currently more than 200 Marrybrown outlets operating in Malaysia, China, India, Sri Lanka, Saudi Arabia, Iran and the UAE, with up to 5,000 dedicated staff employed. Nevertheless, the company is looking to further expand its markets outside Malaysia specifically Asian countries with a population of at least 500 million people, predominantly Muslim countries and countries

that Marrybrown competitors have not yet ventured. Group Managing Director Nancy Liew said that Marrybrown’s success thus far in penetrating international markets has much to do with learning about the different business cultures between one country and another. Besides that, the company also has to overcome language barriers when setting-up in nonEnglish speaking countries. Moreover, the company has to source for raw materials as well as human resource besides do market research on consumer preference. Liew said that Marrybrown is nevertheless aiming to be a global food corporation and plans to do so through franchising. Franchisees would benefit from years of refinement that have gone into developing the Marrybrown concept and products. The company offers a full business format franchise, incorporating total goodwill as well as proven marketing, operating, training, administration and a purchasing system developed over the years. Franchisees will also receive the necessary operating models, start-up and

The company’s commitment in providing variety, quality and value products have earned the company several recognitions and numerous local and international awards. on-going support. Besides that, assistance will also be provided with branding, marketing and advertising resources, design as well as construction in setting up outlets. Marrybrown is also committed in ensuring that all its products are prepared in accordance to Malaysia’s Halal requirements. From the raw materials used to the cooking utensils as well as storage facilities and preparation process -- all are certified Halal so that customers can enjoy Marrybrown products with 100% peace of mind. The company’s commitment in providing

variety, quality and value products have earned the company several recognitions and numerous local and international awards. Marrybrown hopes to excel in the food franchise industry by providing quality, tasty products that can be consumed by Muslims as well as non-Muslims. What’s more it is determined to expand its franchise network and promote the Marrybrown brand through aggressive marketing. For enquiries, call Marrybrown Fried Chicken Sdn Bhd at 607-331 6590 (4 lines) or visit us at www.marrybrown.com.my THE HALAL JOURNAL 37

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Selangor’s Competitive Advantage

Among the pre-requisites for a successful hub are excellent infrastructure and a comprehensive network of interconnectivity. As far as Halal developments are concerned, no other state in Malaysia is as fortunate as Selangor.

alaysia’s push to become a global Halal hub is being reciprocated by many state governments as each clamour to set up their own Halal parks to attract local and international businesses. As it is, there are five Halal parks being built all around the country, including in Perlis, Johor, Pahang, Kedah and Selangor. As the most developed state in Malaysia, Selangor is seen to have an edge over the other states as it can readily leverage on many other well-established infrastructures that are being complemented by key organisations and service providers, making it the most advanced and well-thought out Halal development planning. Covering an area of 150 acres, the Selangor Halal hub in Pulau Indah is designated for high-tech and modern factories for industries, especially those who are in manufacturing and processing of Halal products. More than 50 acres of industrial lots are available complete with excellent infrastructure, utilities supply and fibre optic telecommunication cabling. Strategically situated along the highway to Westport, the state-of-the-art transhipment hub, the Selangor Halal Hub is located in part of a later development phase of the Pulau Indah Industrial Park. Excellent infrastructure and easy road access to Kuala Lumpur, Putrajaya and the Kuala Lumpur International Airport in Sepang make it a good choice for discerning investors. Despite all the technological and infrastructural advantages the facility possesses, the biggest advantage it has is in the incubatory nature of the factories, existing side-by-side with a one-stop Halal centre that would include among others, a Halal laboratory that will not only ensure the Halalness of all goods manufactured here, but will also be able to provide a lot more for foreign and local investors. Spearheaded by an investment arm of the Selangor State Government, the Selangor Halal Hub will also be able to facilitate fast track approval from the relevant government authorities such as SIRIM, JAIS, JAKIM, and assist in obtaining global Halal status together and help facilitate the implementation of world-class standards such as GMP, VI, HACCP and ISO. “Today we see food manufacturers scattered everywhere in Malaysia, so the issue of quality control is often highlighted. This is what makes Selangor Halal Hub concept different than the other Halal Hubs, because not only will it have easy access to the Middle East market, it will also have stringent quality and certification controls. The whole area will have a special laboratory that will take care of quality and Halal certification for all products

“Not only will it have easy access to the Middle East market, it will also have stringent quality and certification controls. The whole area will have a special laboratory that will take care of quality and Halal certification for all products that are being produced here,” that are being produced here,” said Selangor’s Chief Minister, Datuk Seri Mohd Khir Toyo. COMPLEMENTING Selangor Halal hub’s hightech and modern factories in Pulau Indah is Westports, one of the region’s leading ports and winner of Lloyd’s List Maritime Asia Awards for Best Emerging Container Terminal in 1999. Stretching over 11 kilometres, Westports comprise of 30 berths that were built to accommodate dry bulk, instant connection pipes for liquid bulk, LPG and cement containers and vehicles terminals. Port Klang has trading links to 120 countries and is linked by major shipping lines to 500 ports around the world. “The Halal industry is a very important

element in the local logistics business. I think it is very good to identify with, it has got so much potential and I expect it to be the next wave of economic development in the country,” said Westports’ Executive Chairman Tan Sri G. Gnanalingam. Westports’ large docking facilities bring transport costs down as it can accept vessels of higher tonnage. It can berth vessels up to 14,000 TEUs (20 foot equivalent units) and in addition to its sound infrastructure, state of the art information technology (IT) and comprehensive sea connectivity, Westports has extensive road and rail linkages from Pulau Indah that extends to all parts of Peninsular Malaysia. Fast movement of goods is also a vital factor in helping to realise business success. Having a port like Westports that is recognised by the industry for its fast turnaround time and high productivity

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Gazetted as a Free Zone, Port Klang Free Zone allows factories and logistics firms to be located within the same zone so as to allow for easier co-ordination and smoother supply chain management, making it the first development of its kind in Malaysia.

rate will be a key advantage for the success of Selangor Halal Hub. “We have the best infrastructure. I think the country is fortunate that we have the best roads, the best airports, Multimedia Super Corridor and capable ports like Westports to expedite shipping. So we have the hardware and the best infrastructure, and this is going to help businesses take advantage of the emergence of a global Halal industry,” Tan Sri Gnanalingam added. Adjacent to the Selangor Halal hub in Pulau Indah is the Port Klang Free Zone (PKFZ); a one-stop service centre modelled after the Jebel Ali Free Zone in Dubai, which ensures faster approvals for setting up business. The integrated 1,000acre international cargo distribution and consolidation centre was designed to promote entreport trade and manufacturing industries involved in producing goods primarily for export. Gazetted as a Free Zone, PKFZ allows factories and logistics firms to be located within the same zone so as to allow for easier co-ordination and smoother supply chain management, making it the first development of its kind in Malaysia. IN A RECENT MISSION to woo Chinese businesses to Pulau Indah, Tan Sri Gnanalingam pointed out that Chinese food manufacturers, who had been unable to penetrate the Middle East countries, can now do so by repackaging and value-adding their products at PKFZ. “Chinese companies should explore business opportunities with Malaysian food manufacturers to leverage on Malaysia’s global reputation in Halal certification. We have the port, we have the PKFZ facilities and most importantly we have the Halal certification recognised worldwide, that’s the advantage that Malaysia has,” he said.

Selangor Chief Minister Datuk Seri Khir Toyo adds, “There are already 30 international companies that have bought the land and buildings within the 1,000 acres of Klang Free Trade Zone. These 1,000 acres are expected to be fully sold within the next five years, and Jebel Ali is negotiating to buy yet another 1,000 acres to develop as a free trade zone that will have a concept of transshipment and distribution port.” Complementing Westports and Port Klang Free Zone in making the Selangor Halal hub such a powerful proposition is the commitment shown by logistics provider MISC Integrated Logistics Sdn Bhd (MILS) to the entire Halal hub agenda. THE SETTING UP of a Regional Logistics Hub by MILS within the Selangor Halal hub is seen as completing the entire Halal hub package for any prospective

businesses keen on capitalising on the global Halal trade. With a salient mission to design, develop and provide an integrated Halal logistics management solution, MILS will also emphasize Halal as its highest priority and will comply with all Halal logistics standards “to take the Halal concept to the next frontier”. Divided into three phases, the first phase of MISC Regional Logistics Hub (RLH) will initially offer 24,000 square metres of warehouse space which is expected to be ready by December this year. Upon completion of all three phases, the centre will have 90,000 square metres of multi-modular storage and processing facility that would enable manufacturers and importers/ exporters to consolidate multi-country warehouses in a single duty-free location. MILS’ managing director and chief executive officer Hilmi Mohd Nashir said, “It will be the biggest cold room facility in this region and will further boost the Government’s intention of developing a Halal hub in the country. The hub is also well connected to our selfoperated land bridge service into Thailand and Singapore. We have a fleet of prime movers and trailers to complement door-to-door services in the cross-border trade.” Through RLH, MILS also aim to redefine the future of logistics in the region by providing competitive regional hub solution as compared to neighbouring countries. “Thus, from RLH, your products will reach your customers in Malaysia and Singapore within 24 hours, central and eastern seaboard of Thailand within 48 hours, parts of Indonesia within 72 hours, Vietnam within 156 hours and so on and so forth. Geography will no longer be a barrier and trading shall be without hj boundaries,” Hilmi added. THE HALAL JOURNAL 39

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Former Malaysian Prime Minister and President for Vision 1440H Tun Dr. Mahathir Muhammad with President of IDB, Dr. Ahmad Mohamad Ali.

YEAR MASTER PLAN FOR MUSLIMS INITIATED

he Islamic Development Bank has recently launched a 14 year master plan called the “1440 Hijrah Vision” recently. The framework will serve as a guide for the IDB group to embark on strategic initiatives to bring prosperity and development to its member countries and the Muslim world. It was unveiled at IDB’s third meeting of the 1440H Vision Commission in Kuala Lumpur. The 1440H Commission chairman is the Malaysian former Prime Minister Tun Dr. Mahathir Mohamad. “Today marks the beginning of the first step in our journey over the next 14 years to transform this vision into reality. We must not deviate from taking that journey because it is our obligation to enhance the wellbeing of Muslims and uplift the image of Islam,” said Malaysian Prime Minister Dato’ Seri Abdullah Hj Ahmad Badawi who launched the framework. At the event, Dr Mahathir stressed on the need for IDB to re-examine its role and re-invent itself in order to tackle the vastly different challenges within the ummah. He said while banking will still be IDB’s primary raison d’etre, it needs to give greater emphasis to its developmental role. This includes stimulating economic growth to promote well-being, better its infrastructure, improve human resources and maximise all assets that Muslims are endowed with. “We have identified nine key strategic thrusts which we must undertake under the Vision. First, to reform the IDB; second, to alleviate poverty; third, to promote health; fourth, to universalise education; fifth, to prosper the people; sixth, to close the gender gap without breaching the tenets of Islam; seventh, to expand the Islamic financial industry and the skills of financial

management in accordance with Islamic teachings; eighth, to facilitate the integration of IDB member country economies among themselves and with the rest of the world, and finally, to restore the image of the Muslim world,” said Dr Mahathir.

DR MAHATHIR STRESSED ON THE NEED FOR IDB TO RE-EXAMINE ITS ROLE AND RE-INVENT ITSELF IN ORDER TO TACKLE THE VASTLY DIFFERENT CHALLENGES WITHIN THE UMMAH. Dr. Mahathir also stressed that the strategic thrusts and related goals are critical because they can bring about the development of Muslim countries and the ummah which will help restore the relevance and faith in the teachings of Islam today. In addition to poverty he said, ignorance and instability have become a common feature in the Muslim world that detractors assume that these are the natural consequences of following the teachings of Islam. “We are totally dependent upon others for almost all

our needs in life. We produce practically nothing on our own, we can do almost nothing for ourselves, we cannot even manage our wealth. We hire other people to do everything for us. When doing this, we seem not to have faith in Muslim ability or qualification,” added Dr Mahathir. The same can be said in the production of Halal food for the consumption of Muslims. When asked about what measures IDB or the Malaysian government can adopt to spur the global Halal industry amongst member countries, Abdullah suggested that IDB adopt the use of “Bilateral Payment Arrangement” or BPA, which has proven to be successful in increasing as much as 400 to 500 per cent in trade volume within G-15 countries. Established in 1973, the Islamic Development Bank’s main purpose was to prosper economic development and social progress by financing productive projects and programs in both the public and private sectors in member countries. It is made up of 55 member countries and has approved a total of USD38.3 billion in project financing hj as of February 2005.

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finance

The Musharakah Attraction

The Shariah-based proﬁt-sharing concept of musharakah actually helps pump in MORE capital to enterprises. Read all about it.

eople would traditionally think of banks when trying to source for capital to start a venture. While banks are usually reluctant to provide capital to high risk ventures, another alternative is venture capital. Unlike fixed-income financing, venture capital entails the investing partner taking an active role in the recipient’s venture, sitting on the board of directors and provides not just financial support, but also managerial and marketing support during the entire venture period. All profits and losses will then be divided according to a pre-determined ratio. A form of active investment, venture capital financing is praised for its role in promoting growth while maintaining financing stability. From an Islamic viewpoint, such arrangements appear very similar to the model of musharakah, which Islamic banks are seeking, but many in A FORM OF ACTIVE reality failed INVESTMENT, VENTURE to adopt (AlCAPITAL FINANCING IS Suwailem, 1998). PRAISED FOR ITS ROLE Literally IN PROMOTING GROWTH means ‘sharing’, WHILE MAINTAINING musharakah is FINANCING STABILITY. when two or FROM AN ISLAMIC more parties combine either VIEWPOINT, SUCH ARRANGEMENTS APPEAR their capital, labour or both, VERY SIMILAR TO THE MODEL OF MUSHARAKAH, and share in the profits and WHICH ISLAMIC BANKS losses of their ARE SEEKING. joint venture. Historically, musharakah was practised by the Arabs long before the advent of Islam. The system was permitted to continue after Islam, and many scholars consider it to be the most authentic form of Islamic contract. Hussain G. Rammal writes: “While the concept of interest predetermines a fixed rate of return on a loan advanced by the financier irrespective of profits or losses, musharakah does not envisage a fixed rate of return. Rather, the return in musharakah is based on the actual profits earned by the joint venture. This presence of risk in musharakah makes it acceptable as an Islamic financing instrument”. In sharing of profits, most Islamic scholars agree that the ratio should be decided in advance and may

differ from their investment, but if a partner clearly wished to remain a ‘sleeping’ partner, then his profit ratio should not be more than his investment. In case of losses, it is unanimous that each partner shall suffer the loss exactly according to the ratio of his investment. Since it also promotes growth while maintaining financial stability, musharakah is seen as an ideal alternative for the interest-based financing with potentially far reaching effects on both production and distribution. It has proven to be capable of playing a vital role in the development of an economy, especially a Halal economy that is based on the principles of Islam. LAGGING MODERN APPLICABILITY Despite the appeal and economic significance that it could play, Islamic banks are slow to push for the implementation of musharakah. The existing operational structure of Islamic banks, which mimics that of conventional commercial banks, is said to be the main cause of the hold-up, rendering it vulnerable to two types of risks prevalent in the banking sector. Dr Habib Ahmed from Islamic Research and Training Institute writes: “From an operational viewpoint, Islamic banks have institutional structures similar to conventional commercial banks. This is not only reflected in the similarities in the balance sheets, but also in their treatment by regulatory authorities in most countries where they operate”. The root of this problem lies in the improper matching between the

maturities of assets and liabilities in the bank’s balance sheet. When there is a mismatch between the two, liquidity risk arises. Therefore, to finance assets using equity modes of financing, the liabilities need to be of long-term maturity to avoid exposure to liquidity risks. Dr. Habib further explains: “If the financial institutions can invest in assets for longer terms (i.e. equities) that are financed by long-term liabilities, then the risk-adjusted profit for the bank increases. As banks deal mainly with deposits that are short term, complementarities between assets and liabilities indicate that it is optimum (in terms of risk-adjusted profits) to use assets that have relatively short-term maturity”. Since the availability of longterm liabilities is scarce in many Islamic financial markets, most banks would prefer engaging in short-term fixed income instruments like murabahah and ijarah to avoid liquidity mismatch. The bank’s possible exposure to credit risk is also another main reason why banks are hesitant to push musharakah. Credit risk arises when the counterparty fails to meet its obligations on time and fully in accordance with the agreed terms. In cases of default in debt contracts, a bank can easily liquidate the collateral to recover its principles. In equity financing, banks can only minimise credit risks by actively engaging in the improvement of the assets and recovering returns through the sale of its share in the project at the appropriate time. Unfortunately, to dispose of the assets at a fair price is not easy.

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finance

Then, even with strong monitoring and control, the returns of the financier will suffer. Dr. Habib added, “While the financial institution can sell its shares either to the entrepreneur or other interested parties, one way in which the value of a firm can be enhanced is by launching it in the stock market by issuing initial public offering (IPO). The latter would be possible if a well-functioning and efficient stock market exists”. MUSHARAKAH IN MALAYSIA From the perspective of a partnership contract, projects may be financed under the concepts of musharakah or mudharabah. Both are based on a profit-and-loss sharing concept, but there is a difference in the capital contribution and management of the business. In musharakah, all partners contribute capital for the project’s take-off. For this, the partners, including the bank (if it contributes to the capital and becomes a partner), can be involved directly in the day-to-day running of the project. In mudharabah, however, only one party contributes capital, which is the bank, while the client runs the business without direct interference from the bank.

IN A MUSHARAKAH PARTNERSHIP, A FINANCIAL INSTITUTION WOULD INJECT CAPITAL INTO AN ENTITY OR COMPANY FOR THE BUSINESS PURPOSE INTENDED. THIS FORM OF INJECTION CAN BE CONSIDERED AS A DIRECT INVESTMENT OR AS A FORM OF FINANCING. “In a musharakah partnership, a financial institution would inject capital into an entity or company for the business purpose intended. This form of injection can be considered as a direct investment or as a form of financing,” explains K. Salman Younis, managing director of Kuwait Finance House (Malaysia) Berhad. Understandably, banks would prefer musharakah as it ensures commitment on the part of the client to make the project a success (i.e. from capital invested in the project). This partnership contract can be applied to deals for the supply of equipment to the government departments for example. Due to the fixed time frame of the contract, the profit generated can be easily determined and, to a certain extent, assured. The musharakah concept is accepted in the Middle East and is being promoted by the Malaysian

How Venture Capital Built Silicon Valley

he years between 1978 and 1987 were considered the golden age of the venture capital sector in the United States of America. Several successes, like Apple Computers, Lotus, Intel, Federal Express, Microsoft, Sun Microsystems and Compaq sparked bigger interests in the sector. Each of these companies received venture capital support early in its development. The payout each received when they went public was substantially high. Apple for example, received approximately USD3.5 million of venture capital investment during 1978-79. When it went public in late 1980, it was worth a staggering USD271 million, making it the largest public offering since Ford went public in 1956. The strong performance however, was not consistent in later years. The late eighties and early nineties witnessed a decline in both the rate of return and the number of venture-backed initial public offerings (IPOs). However, insiders consider the patterns as merely cyclical. This theory was substantiated on August 10, 1995 when Netscape Communications, then a 16-month old Mountain View company, went public. Netscape had issued five million shares to the public but kept another 33 million for executives, venture capitalists and other early backers. By the end of the trading day, the closing price had left the company with a market valuation of USD1.96 billion! The success of Netscape propelled the venture capital industry into a state of frenzy, particularly for venture capital firms on Sand Hill Road in the San Francisco, California. IPOs were taking truly irrational leaps, and access to ‘friends and family’ shares was becoming a major determiner of who would benefit from any such IPO; the ordinary investor rarely got a chance to invest at the strike price in this period. The NASDAQ crash, technology slump that started in March 2000 and the resulting catastrophic losses on overvalued, non-performing start-ups, shook the industry deeply. By 2003 many venture capitals were focused on writing off companies they funded just a few years earlier, and many funds were ‘under water’; that is, their portfolio companies were worth less than first invested. Venture capital investors sought to reduce the large commitments they had made to venture capital funds. As of mid-2003, the conventional wisdom was that the venture capital industry would shrink to about half its present capacity in the following few years. However, the PricewaterhouseCoopers’ MoneyTree Survey showed total venture capital investments were still holding steady at 2003 levels through to Q2 2005. The revival of an Internet-driven environment, thanks largely to deals such as eBay’s purchase of Skype, the News Corporation’s purchase of MySpace, and the very-successful Google IPO, has helped to revive and restore confidence in the US venture capital industry.

government. “Musharakah is one of the four approved Shariah principles - together with isti’na, ijarah and mudharabah - that provide certain tax (Malaysian) benefits to the issuer,” said Mohamad Safri Shahul Hamid of CIMB Islamic. With musharakah’s varied potential in building the Halal economy, one would be hard pressed to ask this question: what then is stopping it from being used by the Halal industry? K. Salman Younis provide the answer: “Musharakah is definitely one of the most effective ways which

can be used to help drive the Halal industry in Malaysia and other countries. However, the success of this form of financing also depends on the Islamic banking community having the expertise in the Halal business.” “In that regard, we will certainly support the Government’s move to finance viable projects involving the Halal business. We hope to get involved in various business segments such as real estate, construction, manufacturing, plantations, Halal food, automotive and oil and gas,” he added. hj

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BRIDGING THE GAP FOR ISLAMIC INSURANCE IN THE HALAL INDUSTRY Islam does not object to insurance per se. Nevertheless, conventional insurance contracts involve the elements of Gharar (uncertainty), Maisir (gambling) and Riba (interest) which contravene Shariah principles. Takaful seeks to bridge the areas deemed objectionable by the Shariah for the benefit of society. Takaful is an insurance concept grounded on Islamic Muamalat, observing the rules and regulations of Shariah. It is based on mutual cooperation, responsibility, assurance, protection and assistance between groups of participants. In other words, it is the provision of shared contributions to assist people in need of help. The Takaful system stresses the spirit of co-operation and joint responsibility among participants (policyholders). Takaful also allows participants the opportunity to obtain two forms of profit. First, with monetary benefits from the Takaful plan and the profit-sharing arrangement. Second, the spiritual benefit whereby participants can fulfil their religious and social responsibilities through Tabarru’. The added value benefits not just the Muslims, but all participants, irrespective of their religious belief.

comprehensive Family and General Takaful protection and place strong emphasis on product innovation, coupled with differentiating features to ensure market acceptance,” said Syed Moheeb Syed Kamarulzaman, Managing Director of Takaful IKHLAS. Its services are supported by state-of-art technology, designed to ensure accuracy and timeliness of information. “We believe this will help enhance our efficiency and professionalism when dealing with customers, as well as adding value to our stakeholders,” Syed Moheeb added. Takaful IKHLAS had performed remarkably fast and agilely right from the beginning. For instance, the insurer took only 90 days to commence its business operation upon being granted license. This is no mean feat as its ability to fast track its operation reflected its readiness to conduct business. Merely 3 years into operations, Takaful IKHLAS has established an extensive agency network. It is now present in all the major centres as well as a number of smaller towns through Malaysia. These include

The high ethical standards set for its staff and business partners underscores its responsiveness to the customers and reputation for fair and fast claims. Takaful IKHLAS has no “back log” in claim payments as most cases are approved within 24 hours. Takaful IKHLAS Sdn Bhd (Takaful IKHLAS), the country’s fourth Takaful provider, operates in accordance with the Shariah principles. Fully committed to ensuring equity and fairness in all its dealings, a Shariah Advisory Committee oversees all operational matters, investment dealings, management and marketing. In line with international and local developments in the practice of Islamic financial protection services, Takaful IKHLAS adopts the Wakalah (agency) system. It allows the use of intermediaries as a medium to better serve customer needs, payment of surpluses and profits where applicable to participants and calculation of investment profits on a monthly basis. Takaful IKHLAS’ Family protection plans focus on savings or investment-linked plans and mortgage protection plans. Its General protection offerings feature innovative plans to cover properties such as vehicles, buildings and other assets. “We aim to provide

Kuala Lumpur Kota Bharu, Sungai Petani, Johor Bharu. Insha’llah, Takaful IKHLAS will expand its wings to East Malaysia by 2007. The high ethical standards set for its staff and business partners underscores its responsiveness to the customers and reputation for fair and fast claims. Takaful IKHLAS has no “back log” in claim payments as most cases are approved within 24 hours. Its efficiency in claim management spells out its belief in providing “ease of doing business” to its participants. To date, more than 350,000 individuals and corporations have placed their trust in Takaful IKHLAS and have become participants in the company’s Takaful schemes. In line with the company’s aspiration to be the preferred Takaful provider, Takaful IKHLAS intends to continue playing a significant role with its contribution towards the Halal industry, in general, and the Takaful industry, in particular.

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finance update

THE NEW INTERNATIONAL CENTRE FOR EDUCATION IN ISLAMIC FINANCE

INCEIF T

he establishment of the International Centre for Education in Islamic Finance (INCEIF) marks another significant leap forward by Malaysia in strengthening the country’s position as a hub for the global Islamic banking industry. A centre of educational excellence, INCEIF was established to address the human capital needs of the rapidly expanding global Islamic financial industry. Through its educational programmes, INCEIF aims to produce a pool of professionals and a steady supply of talented researchers and educators in Islamic finance. “Human intellectual capital plays a pivotal role in driving the performance and market competitiveness of the industry. Going forward, it will be the defining factor. The fast pace of innovation in the Islamic financial services sector will demand new expertise and skills. Indeed, the creation of a substantial pool of talent and expertise is thus indispensable for the future growth of Islamic finance,” said Bank Negara Malaysia Governor Tan Sri Dato’ Sri Dr. Zeti Akhtar Aziz. She also added that strengthening research and development capabilities is also important to meet the diverse requirements of the rapidly changing global economy. To support INCEIF’s operations, Bank Negara Malaysia has established an endowment fund of RM500 million. The income from the endowment fund will

be utilised to finance its operations. It currently offers the world’s first certified Islamic finance professional programme but plans are in place to offer masters and doctorate programmes. INCEIF’s maiden programme, the Certified Islamic Finance Professional (CIFP), is a holistic and comprehensive syllabus that is divided into three parts, with the final part giving candidates the opportunity to practise their knowledge in the industry and gain industry acceptance. Candidates can opt to specialise in either banking or takaful, creating a professional niche for oneself. CIFP candidates can pursue the programme using a combination of online and onsite learning including attendance to optional seminars and tutorials. It can be completed between a minimum of three years and a maximum of nine years with each module subjected to stringent quality control to ensure its contents remain relevant and abreast with industry developments. Lending knowledge and expertise to INCEIF are distinguished scholars of Islamic economics, including Prof. Dato’ Dr. Sudin Haron and Prof. Dr. Mohamed Ariff of Malaysia, Prof. Dr. Nabil Baydoun from Dubai, Prof. Dr. Masudul Alam Choudhury from Canada, Prof. Dr. Murat Çizakça from Turkey, Prof. Dr. M. Shahid Ebrahim from United Kingdom and many other leading Islamic banking academicians.

Bilateral Payment Arrangement for Muslim Countries Muslim countries should use the bilateral payment arrangement (BPA) to help raise the level of trade activities between Muslim countries, especially in trading of Halal foods and services. Chairman of Organisation of Islamic Countries (OIC) and Malaysian Prime Minister Dato’ Seri Abdullah Ahmad Badawi said “It won’t be too long before Malaysia becomes a Halal hub. We are seeing more participation from the public and private sectors, and in this regard, I hope to see more growth in this sector between IDB (Islamic Development Bank) and OIC countries where we can use a bilateral payment arrangement among member countries for Halal products and services”. BPA is a settlement system for payment obligations arising from trade between two countries. It is an arrangement where central banks or monetary authorities of participating countries agree to pay each other or guarantee payments for its imports. Effectively, central banks or monetary authorities guarantee payments in domestic currencies to their exporters, thus converting commercial risk to sovereign risk. BPA was initiated by Malaysia’s central bank, Bank Negara in 1991 to promote South-South trade within G-15 countries. Aside from commercial risk, BPA also eliminates the exchange risk, the risk of non-payment and enhances confidence for exporters. It also ensures importers have easier access to banking facilities. “Malaysia has gained from the system where previously its small volume of trade with developing countries increased by 400 to 500 per cent,” Abdullah said. In this regard, he added that the central banks of Muslim countries could play a vital role by providing information on credit worthiness, capacity and the availability of know-how of the countries involved, especially in hj the manufacturing of Halal products,” he said.

Generally, minimum academic requirement for entry is a bachelor’s degree, but those with a diploma will also be considered if they have at least five years working experience in related field. Academic terms commence in June and December each year and interested candidates may apply online at www.inceif.org or contact INCEIF Admissions Office at the second floor, Annexe Block, Menara Tun Razak, hj Jalan Raja Laut, Kuala Lumpur, Malaysia.

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ERADICATING POVERTY AND GRAFT POVERTY AND GRAFT GOES HAND-IN-HAND. ONE CAN BE ERADICATED IF THE OTHER IS ELIMINATED. This was the gist of Prof. Dato’ Dr. Syed Hussein Al Attas’s discourse on “Poverty Eradication and the Relevance to Human Rights” organised by Nurul Yaqeen Foundation recently. “If we have more than one illness, we have to realise that no one medicine can remedy all of the illness in one go. We have to prioritise which is the more important to remedy, and in terms of poverty eradication in Muslim countries, we must note that it can only be achieved if graft is eradicated. “We must also realise that the higher the poverty level, the higher the level of graft. So, we must tackle them both together,” said. He notes that while so many plans are made for the society, there needs to be constant monitoring and supervision to ascertain if the actual execution is indeed going as planned. He likens this to building a house, where the owner will employ the best contractor who can get the job done. He will also monitor the progress on a constant basis. If no monitoring was done, and there are cracks in the building, it may be too late. The same with plans to eradicate poverty, it requires constant monitoring or it will simply fail. “It saddens me to note that despite gaining independence for close to 50 years, and being a country with high natural resources, we are

still reading in the newspapers appeals for donation from rural folks to help for their children’s operations or illness. To me, this is not within the spirit of independence,” he added. “We need to instil the philosophy of poverty

eradication into the many master plans we are doing for the country. We need to realise that there are so many illnesses that exist in this country and tackling graft and poverty should be made the main agenda,” he said. hj

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http://bec.iiu.edu.my THE HALAL JOURNAL 51 4/29/06 7:08:33 AM

Words By KAMARUL AZNAM KAMARUZAMAN

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Developing Human Resources within the Halal Industry A United Kingdom advert was placed in the Polish press recently seeking Muslim slaughtermen in an attempt to re-staff Halal meat counters in the UK. The ad calls for “Muslims, who pray ﬁve times a day and adhere to the principles of Halal cuisine, with no pork or alcoholic beverage”. This is not just a one-off event.

he same scenario is being echoed half way across the world. Medina Meat, an Australian Halal meat producer, is lamenting the difficulty to hire certified Halal butchers in Australia, despite offers to pay higher than average salaries. Houssam Dannoui of Medina Halal Meat explains: “Basically, Muslims here are reluctant to work in slaughterhouses because many facilities here have pork involved”. “Slaughterhouses are also mostly located outside the cities, so many don’t want to drive two to three hours to get to their workplace, and finally, people are less enthusiastic to work in slaughterhouses, they prefer other academic-oriented jobs,” he said. According to Houssam, if the average salary of a slaughterman in Australia is $600 per week, Medina Meat is willing to pay up to $1,000 per week for a certified Halal butcher. He added that if the Australian government is serious about tapping the potentials of a global Halal market, they should consider relaxing the current immigration laws to permit qualified Halal butchers into Australia, as they did for Chinese welders and Malaysian carpenters. “This has got to be done soon. Many Halal markets around the world are opening up. The demand for quality Halal meats from Australia is increasing in countries such

as Iraq, Lebanon, Jordan, Algeria, even China. But the world farming industry is getting smaller because of global warming, drought, diseases and so on, and the world population is getting bigger. “This trend will continue and Australian Halal meat is going to be in greater demand than ever before. Surely the government needs to do something about this shortage of labour in the industry,” Houssam added. While this may seem a bit surprising to some, the prospect of developing human resources within the Halal industry is a serious matter that demands some creative thought. Many opportunities exist in the production of Halal goods and services, including the most obvious – the agriculture sector. Halal producers comprise mainly of agricultural as well as agrobased industries, which in Malaysia achieved a total value-added worth RM16.9 billion in 2005 and has the potential to create 128,000 new jobs over the next five years. The

importance of this sector to the nation and the Halal industry was justifiably addressed within the Ninth Malaysian Plan (9MP). “There are no limits to the upside potential of this sector if it is managed effectively. The agriculture sector needs to be viewed through a new lens, infused with fresh conviction, developed with a new spirit – a new agenda,” said Malaysian Prime Minister Dato’ Seri Abdullah Ahmad Badawi during the tabling of 9MP.

ith agriculture identified as the nation’s third engine of growth and the government’s aim to transform Malaysia as a net food exporter by 2010, the sector is not only capable of generating new sources of growth, but can also help to narrow national socioeconomic divides by providing more jobs and simultaneously eradicating poverty. Consider these figures: 37 percent of Malaysians live in rural areas. Seven out of 13 states in Malaysia possess large tracts of rural land. The highest incidences of poverty, with a level of 8.3 percent, occur amongst the Bumiputera community who form the majority of the rural population. 11.9 percent of poverty occurs

“Basically, Muslims here are reluctant to work in slaughterhouses because many facilities here have pork involved”.

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in rural areas, more than twice the national average. If these Bumiputeras start deriving good income from their own land, poverty will most likely be averted. But the sector has its own drawbacks, mainly resulting from the many years of neglect and bad press. The attitudes of locals shying away from agriculture are inadvertently limiting the growth of the Halal industry. A paradigm shift is therefore needed by the locals, through many reinforcements by the government, that venturing into agriculture has its own benefits and plus points. “Every year, it is estimated that 220,000 people will join the labour force. 44,000 of them will possess tertiary qualifications. It will be a challenge to provide employment opportunities to this group. A critical challenge that will need to be addressed is the attitude of local workers who are unwilling to accept low-level employment positions. This forces the nation to rely on foreign labour,” Abdullah added. He went on, “We must think progressively and remove misperceptions that agriculture is a low value-added economic activity capable of only generating small incomes.” High on his priority list is the execution of ‘new agriculture’ programmes that will give focus on enhancing the value chain, cultivating high value-added agricultural activities and large-scale commercial farming, utilising ICT as well as exploiting the full potential of biotechnology. The fact of the matter is, a career in Halal is not just limited to the lower

The fact of the matter is, a career in Halal is not just limited to the lower echelons of the supply chain but is also becoming increasingly sought after by the professionals. echelons of the supply chain but is also becoming increasingly sought after by the professionals. Advancement in biotechnology is an example of how development within a Halal industry neighbour can inadvertently influence the development within the industry itself. “To support the development of this industry, we will improve the investment regulatory framework, develop relevant infrastructure, improve access to funding, increase the rate of R&D commercialisation, increase the number of skilled biotechnology workers and researchers, as well as attract foreign R&D partners,” Abdullah added.

ith increased focus to be given to the usage of biotechnology in agriculture, health care, industrial activities and bio-informatics, the Halal industry could also inadvertently benefit from the spill-over effect from the increase in skilled biotechnology workers and researchers, developing a new breed of Halal lab testers proficient with the latest in food technology. Dr. Mian N. Riaz writes, “Biotechnology covers a wide range of activities

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bio-tech engineer and thus leads to a large number of different applications for the food industry. For Muslims, these new technologies open up new opportunities for expanding their food supply. At the same time, it may also create difficulties in making Halal determinations of food ingredients. Information should be made available on concepts and practices in food biotechnology and genetic engineering, in order to properly evaluate their Halal implication for foods.” Due to this, the demand for food science and technology graduates is expected to be continuous and plentiful within the Halal industry. The recommendation by Islamic Development Department of Malaysia (JAKIM) for Halal manufacturers to setup an in-house Shariah council, or at least an individual, for all matters relating to Halal, is also expected to push the demand for more food experts, especially those with a food sciencerelated expertise. “On and off we do require personnel with a good food science background to work in a small lab within our Quality Assurance Department. JAKIM and other local authorities are very stringent about the extent of food manufacturing, especially the raw materials that we use, so yes, we are always on the look-out for good food technologists,” said Mohd Zaki Omar,

Deputy General Manager of LSG Sky Chefs Brahim’s Sdn. Bhd. With a sizeable increase in Muslim’s purchasing power, the demand for Halal products will also increase accordingly, opening up an even bigger area of expertise within the global Halal industry. No longer would it be just limited to agricultural-related jobs and slaughtermen, a mature and fully developed Halal industry would also require for more professionals, such as in the areas of auditing, certifying and testing.

s the understanding of Halal builds up, a natural progression to elevate Halal to be on par with other established world standards such as ISO, HACCP and GMP is also expected to occur. Once enough Halal products that meet equivalent world standards are available, competition will increase. Since a lot of Halal products are vying for the same consumer’s attention, knowledge to market and advertise these Halal products will also be needed to generate more sales. The fact of the matter is; Halal industry is not just about the processing of Shariah-acceptable slaughtered meats. Halal knowledge encompasses the entire array of industry specialities and expertise. As understanding of the industry increases, even more opportunities will arise and with that, even more Halal-related hj jobs will be created.

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MALAYSIA - Global Hub for Islamic Capital Market Products and Services The vibrant and efficient Islamic capital Market (ICM) in Malaysia today has largely been attributable to the fact that the Islamic capital market has increasingly been attracting two different categories of investors - those who recognise it as a viable alternative form of financing or investment, and those who are specifically inclined towards investing and utilising only products that conform with Shariah principles.

Since the first issue of Islamic bonds in 1990, Malaysia continues with its focus to provide a wide range of products to meet the investment, financing and risk management needs of market players, both local and at the global front resulting in greater depth and breadth of the Islamic capital market. As at end-2005, there were 857 Shariahcompliant stocks listed on Bursa Malaysia, comprising 85% of the total listed securities on the exchange. The availability of Shariahcompliant stocks has also provided the necessary impetus for the development of the Islamic funds management industry. Starting with two equity funds in 1993, there are as at February 2006, 85 Shariahbased unit trust funds comprising both equity and bond funds with a net asset value (NAV) of over USD2 billion (RM8.5 billion) or about 9% of the total NAV of the unit trust industry. Shariah-based unit trust funds in Malaysia have also recorded very impressive growth with NAV growing at

a compounded annual rate of 26.1 %, while the total industry grew at a rate of 8.4% over the last ten years. The release of the Guidelines on the Offering of Islamic Securities by the Securities Commission (SC) of Malaysia further paved the way for more sophisticated and innovative Islamic instruments such as the Sukuk Ijarah and more recently the issuances of Sukuk Mudharabah and Sukuk Musyarakah by Malaysian companies. Total outstanding Islamic corporate bonds as at February 2006 stood at about RM91 billion or 44% of total outstanding corporate bonds. The launch of Dow Jones-RHB Islamic Malaysia Index and the issuance of Islamic bond by World Bank have been the other major developments, testifying to Malaysiaâ&#x20AC;&#x2122;s position as an international Islamic financial centre. Malaysia is also the first jurisdiction to issue the Guidelines for Islamic Real Estate Investment Trusts, which has set the global benchmark for the development of Islamic REITs.

Malaysia is also the first jurisdiction to issue the Guidelines for Islamic Real Estate Investment Trusts, which has set the global benchmark for the development of Islamic REITs. The efforts of the Malaysian Government over the past decade or so in developing the ICM have shown results. These efforts were initially driven by the specific need to address effective and efficient mobilisation of funds of Islamic banks, takaful as well as other Islamic institutions such as Tabung Haji, and enhancing the liquidity management of these sectors. Today not only has this objective been attained, Islamic capital market products

and services have also become part and parcel of the broader capital market landscape in Malaysia, offering viable and competitive alternatives to conventional products and services, hence reflecting their increasing popularity and acceptability both as financing and investment tools. Visit the Securities Commission website at www.sc.com.my for more information on the Malaysian Islamic capital market.

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DINDINGS POULTRY PROCESSING’S HALAL GUARANTEE Dindings Poultry Processing Sendirian Berhad, a subsidiary of Malayan Flour Mills Berhad is renowned as one of the major sources of poultry produce in Malaysia under the brand names of Ayam Dindings and Fiesta. Its flagship product, Ayam Dindings is also exported, notably to predominantly Muslim countries like Brunei Darussalam. Dindings started operations in 1988, the first fully automated poultry processing plant in Malaysia then located in Sitiawan, Perak with the capacity to process 80,000 birds per day. Launched by former Prime Minister, Dato’ Seri Dr. Mahathir, the fullyequipped modern plant is specially designed and constructed along USDA Guidelines to produce export quality products. The plant conforms to strict environmental standards on waste management, which includes the DAF system and practices in line with Department of Environmental Quality Act, 1974 whereby product manufacturing should have minimal or no effect towards environmental degradation. The state-of-theart technology plant incorporates in-house microbiological and chemical laboratories and is managed by experienced professionals including veterinarians, food

technologists, engineers, technicians and skilled operators. “When we look at meat processing, we don’t view our investment in plant and equipment in isolation, but what is more important to us is what drives our business and that’s our people”, said Executive Director Dr. Yap Teow Chong. Dindings commitment to quality standards is unquestionable. Its integrated quality assurance programs from chick to chicken ensure that the strictest quality and hygiene standards are adhered to from feed production, poultry farming, processing and delivery of produce. Dindings poultry products are inspected and endorsed by the Department of Veterinary Services. Its production processes are ISO 9001:2000 certified and conform to HACCP implementation. Consequently, Dindings tends to be the favored supplier to local international fast food chains, bakeries, hotels, supermarkets and airlines besides accepted for export to Japan. Muslim consumers worldwide are also assured that all Dindings poultry products are prepared according to Islamic requirements and are certified “Halal” by the Department of Islamic Development Malaysia (JAKIM) with strict compliance to Malaysian Halal

Dindings commitment to quality standards is unquestionable. Its integrated quality assurance programs from chick to chicken.

Standard MS1500:2004. Knowing our consumers is at the heart of Dindings business model resulting in innovative lifestyle products to meet their needs and wants. Coupled with the adoption of good manufacturing practices, Dindings has earned 2 outstanding recognitions and awards from both the Government and Professional Bodies in 2005 namely, 1. The Highly Commended Product for Malaysian Food Industry to Ayam Dindings BBQ Chicken D’lite by the Malaysian Institute of Food Technology 2. The Outstanding Meat Processor Award by Malaysian Livestock Industry Dindings owes its success to its valued loyal consumers and customers over the years. Moving forward, Dindings is committed to continue to deliver total customer satisfaction to a higher level through implementing an enterprise resource planning system shortly. Our mission is to make Ayam Dindings your best choice in poultry products.

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GOLDEN HOPE PINK GUAVA PUREE

Halal from plantation to processing to ﬁnished product

Golden Hope Food & Beverages Sdn Bhd as a major global supplier of pink guava puree has long recognised the importance of being Halal. While fruits are generally considered Halal we want our customers to know that the method we use to process it is fully Halal compliant as well.

Dato’ Sabri Ahmad

“It is imperative that we follow strict Halal practices to meet their requirements. We have been supplying pink guava puree to the global market and we are wellversed with the demands of the industry.”

“H

alal is not just about whether products are made from meat slaughtered according to the principles of Shariah but should include all items for consumption and the way which they are prepared,” comments Golden Hope Food & Beverages Sdn Bhd’s Senior Manager En. Md Roslan Bin Zulkifly. With more than 22 years of experience in the agricultural business En Roslan is still very passionate about the quality of the pink guava puree that he and his dedicated team produce at the integrated facility located in Sitiawan, Perak, Malaysia. “Of late there is an increasing awareness of Halal practices being more of a way of life, not only on Muslims but everyone else.” There is an increasing number of businesses supplying the Muslim market that insist on

ingredients which is Halal at source. With more than two billion Muslim consumers around the world demanding for Halal certified products and services, manufacturers are keen to source for ingredients which are Halal. “It is imperative that we follow strict Halal practices to meet their requirements. We have been supplying pink guava puree to the global market and we are well-versed with the demands of the industry.” MORE THAN 160 YEARS IN AGRICULTURE AND 14 YEARS IN PINK GUAVA Golden Hope Food & Beverages Sdn Bhd [GHFB] is a wholly-owned subsidiary of Golden Hope Plantations Bhd formerly known as Harrisons & Crossfield. The plantation giant has more than 160 years of experience in the agro-industry with at least 14 years in pink

guava cultivation. Golden Hope is now one of Bursa Malaysia’s top 30 companies in terms of market capitalisation and has 25,000 employees with operations around the world, ie The Netherlands, Vietnam, China, Bangladesh, Indonesia, Germany, South Africa, USA and Morocco. The pink guava estate and processing centre which started in 1991 was initially located In Johor and were managed by Golden Hope Fruit Industry Sdn Bhd. As a result of streamlining the operation was completely relocated to its current place in Sitiawan, Perak – about 2 hours by road north of Kuala Lumpur. GHFB cultivates more than 500 hectares of two varieties of pink guavas known for its rosy eyecatching colour and its sweet musky fragrance. The estate and processing centre are located side by side providing for an integrated facility ensuring the freshness and quality of the puree produced. The total land size makes the GHFB estate the largest of its kind in Asia, capable of producing in excess of 40 tonnes of fruit per hectare annually upon reaching its full potential. We are the leading producer of Halal pink guava puree in the world, supplying more than 15% of the global market. This percentage is projected to exceed 20% by the year 2007. THE HALAL JOURNAL 61

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STUNNING & HALAL

A Review of Global Practices

In a rights-based, modern world, religious slaughter is a somewhat unpopular concept.The idea of animal slaughter in sacred rituals stirs the contemporary imagination to rally against what is perceived to be an archaic belief, subjecting animals to ‘unnecessary’ pain.

A considerable number of animal rights activists hold that stunning prior to slaughter is the only humane method of slaughter. Conversely, Islamic and Jewish groups are equally opposed to stunning with the conviction that Halal and Kosher slaughter, respectively, remain the most compassionate method of taking an animal’s life. With the increasing potential for the globalisation of the Halal food industry, Halal slaughtering has to contend with arguments in favour of stunning technologies as the superior method for animal slaughter. Words By SHARIFAH SHAZANA SYED SALIM AGHA

THE CASE AGAINST RELIGIOUS SLAUGHTER Briefly, there are two different arguments against religious slaughter. The first argument is forwarded by animal rights activists, convinced that the slaughter of animals should be preceded by the act of stunning, which is perceived to eliminate pain and distress for the animal. The second argument is by vegan activists who believe that both the acts of stunning and slaughter are cruel, and call for the ban of all animal products altogether. While the latter has had less than significant impact on government policies, the former has been relatively influential. In 2002, an initiative by the Swiss government to lift the 1893 ban on ritual slaughter received massive opposition from animal rights groups including the Swiss Animal Association which lobbied to conduct a national referendum if the government were to proceed. A poll conducted concluded that 76 percent of the population would have supported the ban. In the face of such debate and opposition, the government decided to maintain the ban. In 2003, the Farm Animal Welfare Council (FAWC), an independent advisory body, established by the British government, reopened the issue of religious slaughter 17 years after the issue had been resolved. As they had done in 1985, a report was published by the FAWC, recommending that the exemption from stunning afforded to religious slaughter under existing legislation be removed. In both cases, the government decided to allow religious slaughter on grounds of religious freedom. Despite the verdict, the fact that these recommendations reached policy-making level is indicative of the level of influence of animal group activists. Disputes between religious groups and animal groups can sometimes become unpleasant. But at the heart of them, lies one central question - does

the animal feel unnecessary pain when the neck of the animal is slaughtered right up to the time that it becomes unconscious? At the heart of them, lies a mutual concern for the best method of slaughter for animals, and, on the part of Muslims, the health of human beings. STUNNING TECHNOLOGIES Stunning is the act of rendering the animal unconscious before a physical cut is made to the neck in belief that it will eliminate pain, discomfort and stress. Broadly, there are three types of stunning technologies available – the captive bolt pistol (mechanical), electrical and gas. Of all these methods, what might be interesting to note, is that the US Food Safety and Inspection Service (FSIS) is calling for a prohibition of the use of the penetrative captive bolt stunning device based on findings

of a risk assessment on bovine spongiform encephalopathy (BSE). This stunning device is believed to incorporate air-injection which can force visible pieces of brain and other central nervous system tissue into the circulatory system of the stunned cattle, thereby risking contamination. THE QUESTION OF PAIN According to the Association of Muslim Lawyers in the UK, the fear that Halal slaughter is cruel to animals is unfounded. When the deep and sharp cut is made, severing the trachea, oesophagus and blood vessels, a massive haemmorage is initiated which induces anoxia (lack of oxygen) in the brain cells. This is said to act as a powerful pain killer, as the animal becomes totally insensitive to pain. This is due to the severe bleeding which is believed to disable the sensory centre.

DISPUTES BETWEEN RELIGIOUS GROUPS AND ANIMAL GROUPS CAN SOMETIMES BECOME UNPLEASANT. BUT AT THE HEART OF THEM, LIES ONE CENTRAL QUESTION - DOES THE ANIMAL FEEL UNNECESSARY PAIN WHEN THE NECK OF THE ANIMAL IS SLAUGHTERED RIGHT UP TO THE TIME THAT IT BECOMES UNCONSCIOUS?

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STUNNING TECHNOLOGIES

Additionaly, there is no scientific certainty that the animal does not suffer pain during the act of stunning. In electrical stunning, the failure to apply the device to the correct position on the head may fail to produce unconsciousness, resulting instead in a condition known as missed shock or “The Nightmare State of Leduc” where the animal is fully conscious but is unable to vocalise because it has been paralysed. This means that the animal will have to undergo slaughter practises that were originally intended for unconscious animals. In 2004, the General Accounting Office (GAO) of US released a report reviewing the Department of Agriculture’s efforts to ensure compliance with the Humane Methods of Slaughter Act. According to the report, ineffective stunning of animals were the most frequent violation of the Act. In addition, it was reported that inspectors were more likely to stop the slaughter line only if there was ineffective stunning

the Islamic Society of North America (ISNA), Islamic Food and Nutrition Council of America (IFANCA), Halal Food Authority (HFA) of UK, Saudi Arabian Standards Organization and the joint Muslim World League/World Health Organization committee. Among Muslim groups that reject the use of stunning is the Muslim Council of Britain (MCB) which argues that stunning contravenes the Islamic code of practice and subjects the animal twice to pain and trauma. In addition, the retention of blood caused by stunning is seen as a risk to human health

The Captive Bolt Pistol

The captive bolt pistol operates using the principle of a gun producing a physical shock to the animal’s brain (as a knock-out does in boxing). There are two types of captive bolt pistols – penetrative and non-pentrative. Penetrative stunners penetrate the skull bone and produce concussion by damaging the brain or increasing intracranial pressure, causing the bruising of the brain. The non-penetrative stunner has a type of bolt with a flat, mushroom end. Without penetrating the brain, it achieves unconsciousness through a strong blow to the skull. As it does not penetrate the brain or cause death, this method is seen as acceptable to certain Muslim groups.

Electrical Stunning

Electrical Stunning is achieved by inducing an epileptic state of the brain. A particular type of electrical stunning that is widely accepted by Muslims, is the electric head-only stunner, which involves placing a pair of electric tongs on either side of the animal’s head. The passing of electricity through the brain is said to produce instantaneous insensibility. The electrical water bath stunning is widely used to stun chicken, turkeys, ducks and geese. Birds are hung upside down clamped in the shackles at their ankles on a moving conveyer which carries them to an electrified waterbath into which their heads are immersed. According to Grandin (1997) cardiac arrest stunning is accomplished in poultry when the current passes from the water bath, in which the head is submerged, and through the metal shackle from which the bird is suspended by its legs.

Gas Stunning

Gas Stunning is performed by exposing the animal to various concentrations of carbon dioxide in the air which causes the animal to lose its consciousness.

of a single animal rather than when multiple animals were ineffectively stunned. It was also reported that the line was stopped in less than half of the cases of ineffective stunning of multiple animals. VARYING VIEWS OF ISLAMIC GROUPS ON STUNNING The most acceptable method to the Federation of Islamic Associations of New Zealand (FIANZ), and many other Muslim authorities worldwide, appears to be the electronic head-only stun which was developed in the early 80s, to meet both Muslim and animal welfare requirements. This method renders the animals temporarily unconscious as the animals subjected to this stunning method would recover if slaughter of the animal was not carried out. Although stunning is discouraged, in communities where stunning is heavily lobbied for, a number of Muslim groups have endorsed the electrical head-only stunning technology. These Muslim groups include

and increases the risk of BSE. The Halal Monitoring Authority of Canada also opposes stunning, stating that all stunning methods are “very delicate” in procedure as “there are many conditions and criteria that must be considered”. They believe that stunning causes the animal unnecessary pain and cites a study by FAWC which records that 35% of poultry die as a result of stunning. As a result, all methods of stunning are disallowed by the HMA unless it can be proven beyond a doubt that the animal is still alive after stunning and that all blood is drained out. The authority does not cite any existing method that qualifies these conditions. The MS1500:2004, Malaysia’s

THE VARYING POSITIONS OF MUSLIM GROUPS WORLDWIDE ILLUSTRATE THAT MUSLIMS ARE IN NEED OF A CLEARER POSITION; A SCIENTIFIC CERTAINTY ABOUT THE LEGITIMACY OF HALAL SLAUGHTER IN MAINTAINING THE WELFARE OF ANIMALS.

Halal certification standard states that stunning prior to slaughter is discouraged but not prohibited. Among the conditions set if stunning were to be carried out are as below: The animal shall be alive at the time of slaughter The stunning shall not kill or cause permanent physical injury to the animal The type of stunning allowed is electronic head-only stunner. Supervision of a trained Muslim, periodically monitored by a competent Islamic authority. Notably, the willingess to debate and explore the soundness of such technologies by Islamic groups contrasts to the responses by Jewish groups, who have, in general outlawed the use of stunning technologies altogether. The varying positions of Muslim groups worldwide illustrate that Muslims are in need of a clearer position; a scientific certainty about the legitimacy of Halal slaughter in maintaining the welfare of animals. While one could say that there is no scientific consensus on the idea that Halal slaughter does not cause pain, the fact is, neither is there any for stunning. In the absence of scientific consensus for both methods, it is up to the Muslim world to lead and close the debate by developing a stronger position based on scientific evidence, certainty and consensus hj in support of Halal slaughter. Sources: Guidelines for Humane Handling, Transport and Slaughter of Livestock, Food Aid Organization (FAO) 2001; Chowdhury Mueen-Uddin, “Religious Slaugher and the Welfare of the Animals” The Association of Muslim Lawyers (UK); Shaykh Muhammad ibn Adam al-Kawathari “Stunning Animals Before Slaughtering Them”; Grandin, Temple “Cardiac Arrest Stunning Of Livestock And Poultry”; Food Safety and Inspection Service, USDA; “Government Report Confirms Slaughter is not Humane”, Animal Welfare Institute Quaterly; Dickter, Adam, “Fear Over European Kosher Bans”, BBC News.

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PRIMA AGRI TO PRODUCE HALAL BEEF FOR REGIONAL FAST FOOD CHAINS Realising the potential of the globally-recognised Malaysian Halal certification in many Muslim-majority export markets, Prima AgriProducts Sdn Bhd has taken the lead by announcing a joint venture with an Australian counterpart to produce Halal beef patties for the regional fast food restaurant chains, including Burger King, A&W, TGI Friday and American Chili’s. Its partner, Comgroup Supplies Pty Ltd, will be bringing in its state-ofthe-art production line, management expertise and ready markets of many international institutional buyers. The new entity, Comgroup Prima (M) Sdn Bhd, will be producing Halal value-added meat-based products at its facility in Bangi beginning this year. Headquartered in Brisbane, Queensland, Comgroup Supplies Pty Ltd has been in production for more than 35 years and is one of Australia’s largest and most diversified manufacturing and marketing organisation specialising in the production of frozen meat products for the fast food and catering industry. Set up in Brisbane and Perth, the company now commands the trust of many global fast food brands that operate locally in Australia but have franchise networks spanning more than 26 countries. They include major fast food brand

names, the likes of Hungry Jack’s, Domino’s Pizza, Pure Foods, Burger King, A&W, Coles, Woolworth, Butlers and Dunkin Donut. With the aggressive push by the Malaysian government to become

meat, specialising in the production of sausages, cold cuts, sate, cook chill sauces, soups and prepared foods, and convenience foods. Their manufacturing plant in Bangi has been

Prima-Agri Products’ Halal facility will also be audited by all of their international buyers, including Burger King, Pizza Hut, Domino’s and A&W. Prima-Agri Products have also built up successful local and export markets, with their PRIMA and BAGUZ brands being marketed to institutional and food service sectors both locally and internationally, including Singapore, Hong Kong, United Arab Emirates and the European Union countries.

To comply with the set requirements by Comgroup’s customers, Prima-Agri Products’ Halal facility will also be audited by all of their international buyers, including Burger King, Pizza Hut, Domino’s and A&W. a global Halal hub, Comgroup, who has been actively seeking more opportunities to manufacture Halal meat-based products in Malaysia, will have that opportunity in Prima-Agri Products. Headquartered in Kuala Lumpur, PrimaAgri Products is one of Malaysia’s largest manufacturers of delicatessens Halal-

accorded numerous international accreditations and certifications. Aside from the ISO 9001:2001, HACCP, GMP and Halal, the plant is also the only facility in Malaysia to be accorded with the stringent export status to the European Union for cooked and processed poultry products. To comply with the set requirements by Comgroup’s customers,

The official signing ceremony of the joint venture agreement was recently held in conjunction with the inaugural World Halal Forum in Kuala Lumpur. It was witnessed by dignitaries from both the Malaysian Ministry of Agriculture and Agro-Based Industries and the Australian High Commission in Kuala Lumpur.

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FARM’S BEST QUALITY PRODUCTS FOR NEW MARKETS Malaysia’s second largest producer of poultry products, Farm’s Best Food Industries, is expanding. The company is already exporting to Asian markets such as Singapore, Philippines, Hong Kong and Japan, but are now looking to penetrate Middle East markets as well as countries with large Muslim populations. Established in 1995, Farm’s Best is the first producer and processor of poultry food products in Malaysia to earn the ISO 9002 certification. The company produces quality chicken products that are fresh, nutritious and tasty. Its processed products include frankfurters, burgers, nuggets, meatballs and breaded drummets that are fast and easy to prepare. The products are manufactured using the latest technology and packaged with high-quality packaging products. They are thereafter stored in cold storage to ensure freshness and longer shelf life. All Farm’s Best products are produced in line with HACCP and GMP requirements. These quality products have earned the company several recognitions including the Outstanding Meat Processor Award at the Livestock Asia Expo & Forum 2003 and a Superbrands Malaysia award. The products are guaranteed Halal by Malaysia’s Department of Islamic Development (JAKIM) and carry the official Halal logo which was first introduced by JAKIM in 1998. The company is also looking forward to expand its overseas market using the JAKIM Halal certification. Currently supplying to hotels, supermarkets, restaurants and fast food outlets, the company also manages its own farm, hatchery and egg production.

“Our employees are trained in all areas related to Halal food production. We also regularly consult the state Islamic Affairs department besides having an in-house Halal committee that oversees production of our products.” “We are very particular about the Halal procedures,” said Farm’s Best group chairman Yang Berbahagia Datuk Haji Abdul Razak Bin Alias. “Our employees are trained in all areas related to Halal food production. We also regularly consult the state Islamic Affairs department besides having an in-house Halal committee that oversees production of our products.” Farm’s Best only uses raw materials, ingredients and packaging products from Malaysian and overseas suppliers that are endorsed by JAKIM to ensure that the products are genuinely Halal.

Besides that, the company only employs state certified Muslim chicken producers to make sure that the proper Halal slaughter procedures are followed. Moreover, to maintain production of top quality goods and increasing market demands, the company continuously upgrades its factory and facilities. Besides housing state-of-the-art machineries, the factory is also equipped with a waste water treatment and rendering plant. Farm’s Best success is attributed to an efficient and dedicated management team whose goal is brand-building and expansion of market. Its team of experienced marketers have succeeded in promoting the Farm’s Best brand as a household name in Malaysia through effective advertising and extensive distribution. They conduct market research regularly to ensure that Farm’s Best products remain competitive in the market. The company invests significantly in improving human capital by conducting training and refresher courses regularly for all levels of its 850-member personnel. The areas of training include technical training, information and communications

technology (ICT), management and quality control. “Training is very important in our industry where technology evolves rapidly. In order to keep up, improve ourselves and be able to stay competitive in Malaysia and overseas, we need a skilled, productive, innovative and creative team,” said Datuk Abdul Razak. The Farm’s Best team believes that Malaysia’s effort in developing a global Halal economy will be a profitable venture considering the huge Halal markets around the world still untapped. They look forward to seeing Malaysian government agencies act proactively in providing information to overseas investors as well to Malaysian Halal producers who plan to expand their businesses abroad. The Malaysia External Trade Development Corporation (MATRADE) is expected to play a vital role in establishing a network of Halal-based businesses and facilitating trade between Halal product producers based in Malaysia with those abroad. For enquiries, please call Farm’s Best Food Industries Sdn Bhd at 603- 6092 6077. THE HALAL JOURNAL 67

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MAY+JUNE

2006

Today, Putrajaya is an administration centre comparable, if not better than, Washington D.C in the United States, Canberra in Australia, Brasilia in Brazil, Asatana in Kazakhstan and Pretoria in South Africa.

THE

HALAL

JOURNAL

LIVING

PRIDE OF PUTRAJAYA DINING AMIDST ISLAMIC ART THE CALL OF TURKEY MUSIC, BOOK AND PRODUCT REVIEWS + MORE INSIDE

THE HALAL JOURNAL LIVING

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architecture

Man-God-Environment Philosophy

o f P U T R A J AYA

SPRAWLING, magnificent and simply breathtaking. Putrajaya is the relatively new Federal Government Administrative Centre of Malaysia. Words By RYANA MUHAMMAD

ocated in the middle of the Multimedia Super Corridor, it is a futuristic city designed to be both a ‘Garden City’ and ‘Intelligent City’ in one, the kind that boasts the best in planning and landscaping to reflect the ideal ‘City of Tomorrow’. The development of Putrajaya, is by no means over. More is being done to ensure that all government departments will be located here by 2010, followed by other commercial and residential developments. For the first time in Malaysia, an urban planning doctrine was implemented in the construction of Putrajaya – one that has become a model for the planning of other new townships in the country. The doctrine consciously factors man’s relationship with God, the environment and with each other. Hence, hills and rivers are left alone to preserve the environment. These are surrounded by parks and open spaces, places of worship and residential areas equipped with amenities that would encourage an active, lively and caring society. In fact, the

largest percentage of land area is allocated for open spaces such as parks, gardens and lakes. “People in urban areas today have become so detached from each other,” laments Dato’ Jebasingam Isaace John, Director of the City Planning Department, Perbadanan Putrajaya. “They live their busy lives and retreat to their quiet homes and care little about others around them. Many don’t even know their neighbours.” The reason behind Putrajaya was simple – it was necessary. Kuala Lumpur, which had been the country’s capital city and centre of administration, was getting far too congested. The government needed new facilities to provide better service to the public, yet retain Kuala Lumpur as the principle business and financial centre.

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“The walkway

bween the two buildings of the Perbadanan Putrajaya complex is the link bween the Palace of Justice and the new mosque. It will be called the ‘Kiblat Walk’ since the facade of both the mosque and the Palace of Justice look towards Mca” The result is the largest integrated urban development project in the history of Malaysia. Covering an area of close to 5000 hectares, it combines the development of government institutions, commercial, residential, public amenities and infrastructure to accommodate a population of approximately 320,000 residents. This idea had actually been discussed over 20 years ago, during the administration of the then Prime Minister, Tun Dr. Mahathir Mohamad. A man of vision, he said that once completed and fully operational, Putrajaya will be a city that characterises the spirit of Malaysia in its fullest sense in the 21st century. But it wasn’t until 1993 that the decision to build Putrajaya was made. The Government received all kinds of proposals as to what an intelligent city of the future should be. “There was one that suggested a concentrated linear city concept featuring a long line of high-rise buildings and another that proposed the city be shaped like a crescent,” shared John who added that it was the intelligent garden city that was preferred for its man-God-environment philosophy. In October 1996, the first construction started in this area, formerly called Prang Besar, a rubber and oil palm plantation that was a part of Selangor. “We had the advantage of building a planned city. A green field to reflect the nation and the people’s aspirations,” said John. Today, Putrajaya is an administration centre comparable, if not better than, Washington D.C in the United States, Canberra in Australia, Brasilia in Brazil, Asatana in Kazakhstan and Pretoria in South Africa. Named in honour of Malaysia’s first Prime Minister, Tunku Abdul Rahman Putra Alhaj, Putrajaya is divided into two major areas separated by a large man-made lake. The Core Area comprises the Government, Mixed Development, Civic & Cultural, Commercial as well as Sports & Recreation precincts while the residential, parks and public amenities are located in the Periphery Area.

One look at its vast expanse and the first thing that would strike you is, perhaps, how majestic all the buildings look -- large, contemporary designs surrounded by neatly manicured grounds. Countless domes, so synonymous with Islamic architecture, dot the tops of some of the most prominent buildings in the area such as Perdana Putra, which houses the Prime Minister’s office, the Palace of Justice, where the Court of Appeal and Federal Court is, and of course, the pink-domed Putra Mosque. What’s more, works on a new mosque (which has yet to be named) are under way. With a capacity to accommodate some 20,000 jamaah (worshippers), the mosque, which will be in full view of the Palace of Justice will be situated at the waterfront, behind the sparkling white Perbadanan Putrajaya complex. “The walkway between the two buildings of the Perbadanan Putrajaya complex is the link between the Palace of Justice and the new mosque. It will be called the ‘Kiblat Walk’ since the facade of both the

mosque and the Palace of Justice look towards Mecca,” explained John. Meanwhile, John said that plans for the construction of churches, temples and other houses of worship are currently on the way. These will be located at the Diplomatic Enclave, where an international community is expected to grow. Close to Precinct 14, where the Ministry of Foreign Affairs sits high on a hill, the architecture of the buildings at the Diplomatic Enclave has unique features also. While traditional motifs on songket, Dayak shields, wood carvings, as well as iconic items like the obor (torch), Nyonya cucuk sanggul (hair pin) and the wau (large kite) can be seen on the street furnishings (lights, bins and benches), arches and on buildings, the Diplomatic Enclave is inspired by the old charm of Penang and Malacca. No doubt, once completed, the area would be yet another attraction in Putrajaya.After all, said John, this national heritage already has all the hardware. “We just need to bring it alive…” hj THE HALAL JOURNAL LIVING

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browsing

Destination tip: Washington DC

The next time fate brings you to the capital of the USA, try keeping an eye out for the Halalco supermarket located within the northern Virginia suburbs of Washington. Set up some thirty years ago, the supermarket not only stocks up Halal meat, it also carries the usual kitchen staples, Islamic books, Muslim clothing, Arabic letter puzzles, videos, Muslim-friendly toys and jewellery. This gem in American consumerism was even set up and expanded without borrowing a single cent from the bank! Halalco Supermarket, 155 Hillwood Avenue, Falls Church, VA 22046 | TEL: 703-532-3202 | www.halalco.com

CD Review

SAMI YUSUF, MY UMMAH

Two year’s after the success of his first album, Al Mu’allim, British-born singer Sami Yusuf returns with My Ummah, an inspiring yet soothing contemporary nasheed that seemingly transcends all known genres of music with melodies and lyrics that will grab your attention right from the first track. Clearly, Sami’s uniqueness is his ability to mix different cultures and artistic influences from all over the Muslim world, blend them together to make great songs. A composer since young, Sami’s excellent vocals is supplemented by extensive knowledge of notes and harmonies, including the Middle Eastern modes (or maqams). My Ummah also features a contribution from the famous Indian poet and lyricist ‘Ustadh Mehboob’ and a track featuring Danish rap group Outlandish.

Book Review

PURIFICATION OF THE HEART

Signs, Symptoms and Cures of the Spiritual Diseases of the Heart

Translation and Commentary of Imam al-Mawlud’s Matharat al-Qulub By Hamza Yusuf

Museum Restaurant

Indulge in a five-star Middle Eastern cuisine within the setting of an Islamic art museum. The restaurant in Islamic Arts Museum Malaysia sets visitors in a harmonious atmosphere of soothing water features, chic décor and Islamic designs. Savour the creations of Chef Ayman, an Egyptian chef who reputedly specialises in preparing foods that fights illnesses. The winner of the Halal Journal’s Best Restaurant Award 2005 serves up authentic Middle Eastern cuisines as well as a choice of local and western spread. This beautiful and delectable restaurant is ideal for business and private dining. ADDRESS Islamic Arts Museum Malaysia, Jln Lembah Perdana, Kuala Lumpur, Malaysia. TEL 603 2270 5188 or 603 2274 5106 | EMAIL info@iamm@org.my SPECIALITIES Middle Eastern, local spread, snacks and sandwiches OPENING HOURS 10am – 6pm (closed on Mondays) SEATING CAPACITY 170, up to 400 inclusive of pavilion

This exploration of Islamic spirituality delves into the psychological diseases and cures of the heart. Diseases examined include miserliness, envy, hatred, treachery, rancour, malice, ostentation, arrogance, covetousness, lust, and other afflictions that assail people and often control them. The causes and practical cures of these diseases are discussed, offering a penetrating glimpse into how Islam deals with spiritual and psychological problems and demonstrating how all people can benefit from these teachings. In essence, Purification of the Heart is a course on the ‘Greater Jihad’ - as it has been called by illustrious learned men and women of Islamic civilisation - our struggle to become better human beings, luminaries of faith and morality.

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contact us at +60(3) 2145 3380 or info@microlink.com.my visit us at http://www.microlink.com.my systemsinone servicesinone

country in focus

Turkey A BRAVE NEW WORLD THAT COULD BE

IN DECEMBER 2004, on the

Words By day after the European Union TONG YEE SIONG

(EU) agreed to set a date for Turkey’s entry negotiations, a Turkish daily quoted Nazim Hikmet, an iconoclastic 20th-century poet: “Beautiful days beckon us, lads, sunny days beckon.” Indeed. The statement sums up the positive sentiments about Turkey, looking at ongoing as well as potential changes across various facets of life, from governance to social administration. But of all the changes, it is the expected progress in Turkey’s economic sectors and trade policies that will be of utmost interest to investors and businesses. For a start, Turkey’s gross domestic product (GDP) growth in 2004 was more than 8% up on the year before, a rate that no country in the EU came close to matching. As ever, the caveat is in inflation, which hit 11.4% for 2004. Having signed a three-year stand-by agreement with the International Monetary Fund (IMF) last May, Ankara is expected to continue with tight fiscal policy and state-bank restructuring. Turkey has brought its government debt level closer to Europe’s while moving to privatise state-owned monopolies. It has shrunk government spending by USD4.5 billion a year while sending farm incomes plummeting. Turkey’s pursuit of a place in the EU has set in motion changes and reforms that have made this country of 70 million a more market-oriented economy, putting new pressures on Western Europe as it ties its fortunes closer to global trade.

DECLINING AGRICULTURE SECTOR For decades, Turkey’s fertile soil and hardworking farmers made the country one of the few in the world that was self-sufficient in terms of food. Its climate and adequate rainfall made possible a wide range of crops. But as the country shifted its emphasis to industrialisation, agriculture’s share in overall income has fallen progressively, slipping

steadily from almost 50% of GDP in 1950 before it stabilised at around 15%. On one hand, despite the stagnant, if not declining, sectoral performance, agriculture remains an important part of foreign trade. Turkey enjoys a comparative advantage in exports of cereals, pulses, industrial crops, sugar, nuts, fruits, vegetables, olive oil and livestock products. Agriculture also continues to provide one-third of employment. On the other hand, with an aggressive drive to promote manufacturing and services sectors – at times, at the expense of agriculture – Turkey has over the years opened a window of opportunity for greater agricultural and food imports. In fact, between 1990 and 2001, Turkey’s relative food prices fell by 20% in comparison to the overall consumer price index. This odd phenomenon – at a time when Turkey had to battle rapid inflation – may have to do with more open trade policies pertaining to

agricultural and food imports. Barring a setback in policy reform, this could augur well for demand of both food as well as processed, value-added products. Yet, despite the promising start, traders must not overlook the fact that much of Turkey’s import ban is still in place, effectively closing off a lucrative market to international exporters, particularly in meat and livestock segments. A confusing and everchanging system of agricultural support, tariffs and others barriers to trade continues to dampen exports to Turkey. And even with changes underway in preparing Turkey’s admission into the EU, the largely protectionist farming practices within the continent itself and the multiple layers of bureaucracy that are at work will mean that meaningful changes in Turkey are going to be slower than desired.

PROCESSED FOOD In the short to medium-term, opportunities lie in consumer-

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Turkey at a Glance CAPITAL: Ankara GOVERNMENT TYPE: Republican parliamentary democracy POPULATION: 70,413,958 ETHNIC GROUP: Turkish 80%, Kurdish 20% LANGUAGES: Turkish (official), Kurdish, Dimli (or Zaza), Azeri, Kabardian RELIGIONS: Muslim 99.8% (mostly Sunni), other 0.2% (mostly Christians and Jews) ECONOMY GDP(PURCHASING POWER PARITY): USD552.7 billion GDP – COMPOSITION BY SECTOR: agriculture: 11.7% • industry: 29.8% • services: 58.5% BUDGET: revenues: USD93.58 billion • expenditures: USD115.3 billion AGRICULTURE PRODUCTS: tobacco, cotton, grain, olives, sugar beets, pulse, citrus; livestock INDUSTRIES: textiles, food processing, autos, electronics, mining (coal, chromite, copper, boron), steel, petroleum, construction, lumber, paper INDUSTRIAL PRODUCTION GROWTH RATE: 5.5% EXPORTS: USD72.49 billion EXPORTS - COMMODITIES: apparel, foodstuffs, textiles, metal manufactures, transport equipment Exports - partners: Germany 13.9%, UK 8.8%, US 7.7%, Italy 7.3%, France 5.8%, Spain 4.2% IMPORTS: USD101.2 billion IMPORTS - COMMODITIES: machinery, chemicals, semi-finished goods, fuels, transport equipment IMPORTS - PARTNERS: Germany 12.9%, Russia 9.3%, Italy 7.1%, France 6.4%, US 4.8%, China 4.6%, UK 4.4% CURRENCY (CODE): Turkish lira (YTL)

such a designation in a country that is almost 100% Muslim, the government’s explanation was that it would open doors to foreign markets. Kenan Malatyali, chief of the Turkish Institute for Standards (TSE), said some form of designation similar to that pioneered by Malaysia will “help increase exports”. Moving forward, expertise and services in Halal certification and procedures from Malaysia may prove useful in shoring up consumer confidence and the “religious credentials” that are needed for Turkey’s products, when it comes to reaching out to the Organisation of Islamic Conference (OIC) markets. In the long run, Turkey’s admission into the EU, should it materialise, will be more than just fulfilling the Turks’ decadelong wish. It will serve to succeed where the predecessor of Turkey, the Ottoman empire in the mid-19th century, failed. Back then, the empire introduced a series of reforms known as tanzimat, or reorganisations. These were modelled on European ideas about things such as property rights, education and taxes, and were meant to help the ailing empire’s economy catch up with its peers in the west. But the tanzimat did not get very far, and by the 1870s the empire was infamously described as “the sick man of Europe”. Over the years, many Turks have quoted this with perverse pride – they may have been sick, but at least they were part of Europe. Today, as Turkey gears up for reform again in preparation for EU’s entry talks, it may yet finally become a healthy, attractive man of Europe, with Islamic characteristics and elements of modernity fused beautifully in this country that, incidentally, is situated between the West and Asia. hj

Turkey’s pursuit of a place in the EU has set in motion changes and reforms that have made this country of 70 million a more market-oriented economy, putting new pressures on Western Europe as it ties its fortunes closer to global trade.

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PHOTOGRAPH COURTESY OF EMBASSY OF REPUBLIC OF TURKEY KUALA LUMPUR

oriented processed food products. This is, of course, not an easy market, given that Turkey produces abundant agricultural commodities, has a fairly advanced processing sector and its consumers traditionally prefer fresh food. Still, opportunities exist in retail food, as well as in the hotel and food services sectors. As with most countries, a good local partner and shipping agent can often help new suppliers through a sometimes cumbersome regulatory process. Supermarkets have recently become popular venues, thanks to major investments and joint ventures between Turkish and European entrepreneurs. There are now more than 50 hypermarket and supermarket players in Turkey, including homegrown Migros and foreign-owned Carrefour and Champion SA of France. The customer base for these stores is middle- to upper-income shoppers who live in urban areas. They are familiar with modern-style foods and are drawn to specialty as well as ready-to-serve items. For Turkey to capitalise on its vast agricultural resources and to open more doors in reaching new markets, the republic can also make use of Halal certification expertise provided by countries that are way ahead in the area. This is an area worth exploring, considering Turkey’s history. At the insistence of the charismatic founder of the republic, General Mustafa Kemal who was subsequently referred to as Ataturk or “father of the Turks”, Turkey practises secular laws rather than Islamic laws. Due to tight controls over religion, for years, Turkey was, ironically, seen as more European than Islamic in eyes of the Muslim world. Turkey admitted this problem as much when in November 2005, Ankara reportedly started a process of designating foods and meat Halal. When questions were raised about the need for

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advertorial

TABUNG HAJI TRAVEL OFFERS MUSLIM LIFESTYLE PACKAGES

ommencing its operations in 1972, Tabung Haji Travel’s main focus was to ensure on the traveling needs of Malaysian Muslims to perform their Umrah and Hajj duties in the holy land. Tabung Haji Travel is a wholly owned subsidiary of Tabung Haji (Pilgrim Fund Board of Malaysia), a body that provides Muslims with a saving plan for their pilgrimage duties. Most Muslims in the country are depositors and as depositors; they have high expectations on Tabung Haji Travel’s services. Understanding this, Tabung Haji Travel has created many different packages to cater to individual needs. With competitive pricing structures, their travel packages are mapped out according to the affordability of all income groups. After being in the Hajj and Umrah travel industry for more than 30 years, Tabung Haji Travel has extended their services to a wider scope of Islamic travel. “Muslim Lifestyle Packages” are travel packages to Beijing, Cairo, Paris, London, Sydney, Ho Chi Minh, Tokyo, Jakarta, Istanbul, Auckland, Hong Kong and more. With years of experience on handling the niche Muslim travel sector, Tabung Haji Travel has managed to put in all their resources together to create packages that are sensitive to the Muslim needs. “Our ‘Muslim Lifestyle Packages’ are not just based on recreation alone, it has educational and religious values. Each trip is composed of tour destinations with Islamic heritage, and in some sectors the tours include visitations to the local Muslim communities and mosques. We would rather position ourselves to providing a

complete ‘Muslim lifestyle packages’,” said Tabung Haji Travel chief executive officer, Haji Syed Saleh Syed Abdul Rahman. He added that all of the services, including ticketing, are also available at their 6 branches in Johore, Penang, Kuala Lumpur, Kota Bharu, Sabah and Sarawak. “We provide a full array of travel related services, an end-to-end service for the

“Our ‘Muslim Lifestyle Packages’ are not just based on recreation alone, it has educational and religious values. Each trip is composed of tour destinations with Islamic heritage, and in some sectors the tours include visitations to the local Muslim communities and mosques. “ HAJI SYED SALEH SYED ABDUL RAHMAN TABUNG HAJI TRAVEL CHIEF EXECUTIVE OFFICER

Muslim traveler namely flight, transfers, food, accommodation and provide guidance or counseling to prepare our customers beforehand,” explains Hajjah Yasmin Dato’ Mohd Yazid, general manager of Tabung Haji Travel. Being sensitive to Muslim travelers means to understand their requirements for Halal food and beverage, tour itineraries that include prayer schedule and places to perform the prayer (solat). Other added features are visitations to Islamic heritage and civilization sites. Travelers can experience and learn about the lifestyle and culture of Muslim communities from different parts of the world. In-depth research work is done before organizing any tour. Representatives are sent for a familiarisation visit to conduct research and identify credible tour operators to facilitate the research on food and beverage operators, areas to perform prayers, whereabouts of local Muslim communities and Islamic legacies of the destination. Their close relationship with the muslim associations globally is an advantage towards their development of travel networks. The development of their tour packages transcends from their caring experience for the Hajj and Umrah pilgrims. During the journey, Tabung Haji Travel’s representatives spends at least a month and a half to learn, understand and care for them. With the amount of time spent learning Tabung Haji Travel came to a realization on developing a true Muslim travel packages with a focus on Muslim guidelines. Another unique feature that Tabung Haji Travel

“We provide a full array of travel related services, an end-toend service for the Muslim travelers.” HAJJAH YASMIN DATO’ MOHD YAZID GENERAL MANAGER TABUNG HAJI TRAVEL.

provides their end customers is preparation. Started out as spiritual preparation for the Hajj and Umrah pilgrims, Tabung Haji Travel prepares their customers by providing information on their destinations through briefings ensuring on the supply of Halal food, the ability to perform their “solat” and about the local Muslim community living in the area. Staying competitive in the industry, Tabung Haji Travel is aggressively marketing their “Muslim Lifestyle Packages” to meet the recent demand growth. Their drive and aspiration is to be the preferred Muslim travel solution provider that fulfills their customers’ spiritual, business, recreational, and personal needs with a high degree of professionalism, integrity and reliability. Non-Muslims can also use Tabung Haji Travel for their travel requirements. Tour packages offered have no barriers in terms of food served or accommodation chosen. A plus point here is that the tour educates on civilizations as well as the lifestyle of local communities. Incomparable to any, Tabung Haji Travel encourages all to leverage and utilise their sales networks available throughout the nation for their next travel arrangements.

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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.

Jasmine’s Brown and Red Rice

NutriRice and SunBrown unpolished brown rice are the latest nutritious rice products introduced by Jasmine as a healthier alternative to white rice. Brown rice is rice with the outer layer or husk removed, but with the bran layer intact and without being polished. The bran layer contains fibre, B vitamins and minerals. It also contains other nutrients present in other parts of the rice, such as carbohydrates and protein from the endosperm and antioxidants, as well as vitamins E and B. The new range comprises the Thai Fragrant Brown Rice and Thai Red Rice from Thailand, the Calrose Brown Rice from Australia and the Malaysian SunBrown. www.jasmine.com.my

Low Seat Hoon’s Sesame Oils

Try adding some sesame oil as flavouring into your cooking. Sesame oil can improve the functions of the digestive and respiratory system and works as good as cooking oil. It contains no cholesterol but possesses a myriad of benefits including relieving menstrual pain, protects the hair, neutralises alcoholic effect, slims the body, lowers the level of cholesterol in the body, relieves stress and lowers the blood pressure. Women have also consumed large quantities of sesame oil to keep them warm during postnatal period and to remove excess gas and improve the spleen function. This product is certified Halal by JAKIM. www.lowseathoon.com.

Q.B.B Pure Ghee

Australia’s Queensland Butter Board’s Pure Ghee has almost 80 years of history and is the first and the only organisation in the world to manufacture ghee from butter through a complex manufacturing process, making it light, pure and resistant to spoilage. When used for cooking, QBB Pure Ghee has an excellent aroma and does not smoke, sputter or burn. It imparts the benefits of the best essential fatty acids without the problems of oxidised cholesterol, transfatty acids or hydrogenated fats. This AFIC-certified Halal product is also free from artificial colouring and flavouring, and is resistant to free radical damage and is free from both salt and lactose. www.qbb.com.sg

My Cola

My Cola is a Malaysian-made soda, a beverage developed after two and half years of R&D by My Beverages (M) Sdn Bhd. Available in 325ml aluminium cans and 1500ml Pet bottles, My Cola is a refreshing drink that not only tastes great, but also uses natural flavouring. This drink can be enjoyed by both young and old for its smooth and unique taste. This product is certified Halal by JAKIM. For more details, call +6037785 0786 or email: adam@mycola.com.my.

Kart’s Frozen Roti Canai

This Roti Canai combo with Dhall Curry is a great way to have a quick snack. All you need to do is take it straight out of the freezer and pop it in the microwave for 1 minute! The gravy is included and you just dip and go. If you have a fridge and microwave at work then lunch is always on hand. You must make sure that you get the packet with the microwave sticker though! Otherwise you will have to defrost and fry which means more unnecessary oil. Keep it healthy. www.kartfood.com.my 78 THE HALAL JOURNAL LIVING

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parting words

the view from 2 worlds

Sarah Joseph is the editor of emel magazine, a lifestyle magazine with a Muslim focus. The magazine is the only UK-based Muslim magazine to achieve mainstream distribution and has readers in over 30 countries. Given that she embraced Islam 18 years ago, Sarah has the fortunate position of experiencing two worlds and has attempted to use that position to promote mutual respect and understanding via communications. She was awarded an OBE in the June 2004 Queen’s Birthday Honour’s List for services to inter-faith dialogue and to the promotion of women’s rights. Here are excerpts of The Halal Journal interview with Sarah via email. WHAT ATTRACTED YOU TO ISLAM? My brother embraced Islam in order to marry. I was a devout Christian and was very angry with him. I realised that I was prejudiced about Islam. My prejudice was caused by fear; my fear caused by ignorance. So I started to study Islam. I found a religion very similar to my own Christian faith. I was very impressed, but I did not want to be a Muslim. Slowly however I lost my faith in the Christian Church. This had nothing to do with Islam, but the way I felt about certain historical events in Christianity. This was very painful for me. My study of Islam continued. I was moved by the Qur’an; I was impressed that it was unchanged. Then one day I saw a girl at prayer. I saw her bow down in sujud and I realised that Islam meant Surrender. If I wanted to surrender my life to God, I realised at that moment then Islam was the straightest and simplest path.

WHAT DO YOU REGARD AS YOUR HIGHEST ACHIEVEMENT? By God’s grace I have been afforded many opportunities to promote the message of Islam and the cause of Muslims. I have lectured and written for over 15 years and for me the happiest moment is when I meet a young person who tells me that they now work to promote justice and goodness because of a talk I gave or an article I had written inspired them. Alhamdulillah! emel, the magazine that my husband and I founded in 2003, is of course a great achievement. We created it against all odds; against so many people saying that such a venture was impossible.

we are against: “We are anti-terrorism”, “We are against extremism.” What kind of identity is that? These things are true, but what do we stand for? emel provides a forum where we can express who we are, what we stand for and also a place where people feel comfortable to be themselves – not always apologising for international events beyond their control. emel also seeks to normalise the image of Muslims away from the frightful headlines and caricatures of violence. It is very important that Muslims are humanised. If a people are dehumanised then it is easier to perpetrate injustices against them – as history shows. We also try and promote an ethical consumerism to our readers. We cannot escape from the technological age, nor from the

consumerism of our societies. However we can balance that with an ethical world view that promotes balance.

WHAT IS THE PERCEPTION OF HALAL IN THE UK?

“

The understanding of Halal tends to relate to meat and food products; however there is a widening in understanding of the term as Islamic awareness increases. Finance products are now beginning to be grouped into the Halal market: “Halal financial investments,” “Halal loans” etc. And I believe that this trend will grow. There is also a developing trend to look at the ethical background of products to see whether they are in the spirit of Islam not just within the law, for example organic products, ethical investments, environmentally friendly products, etc. hj

We cannot escape from the technological age, nor from the consumerism of our societies. However we can balance that with an ethical world view that promotes balance.

”

WHAT ROLE DOES EMEL HAVE IN THE UK AND THE WORLD? We created emel to be a positive voice for Muslims. As Muslims in the current geo-political climate it is easy to feel embattled and defensive. It is also easy to define ourselves only by what

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MATRADE