No one would argue the fact that Indonesia has the largest Muslim population in the world. Consisting of over 260 million people, Indonesia has more than 88% Muslim citizens.
According to a study conducted by Thomson Reuters, just in 2015 alone, Muslims worldwide spent over US$1.9 trillion in a variety of sectors, especially in food and beverages, and clothing industries. In 2016, Indonesia was ranked the country with the highest spending on food and beverages, amounting to US$169.7 billion.
Therefore, Indonesia is favorably positioned to be the biggest halal products hub in Southeast Asia. This is very attractive to many foreign investors. The projection is further supported and evidenced by the diverse Indonesian demographics, increasing consumer awareness, growing income, and rising awareness of religious obligations.
Let us take a closer look at the halal industry in Indonesia, and how ready the industry is to drive and shape the future of Indonesia’s economy.
In 2018, the Indonesian government revealed that halal certification would be made mandatory by 2019. This actually makes sense because Indonesia wishes to push the already booming halal industry and lead the country to become a global halal hub.
Plus, Indonesian Halal market has yet to reach its full potential. Many opportunities are on their way to benefit the investors, business owners, as well as the country’s economy.
Furthermore, the global Muslim population will increase to 2.2 billion by 2030 and the Indonesian population contributes to a big part of the increase. Within 8 years’ time from 2010-2018, the Muslim population in Indonesia reached 200 million people and the number has never stopped growing.
With all the stated facts, the demand for halal products is believed to rise significantly. Numerous small and medium-sized companies in Indonesian have already taken advantage of these halal opportunities.
A result from Google Trends shows the search for halal topics has hiked greatly, indicating that people have increased interest in halal products and services.
With a market value worth more than US$1 trillion and is estimated to reach US$2.6 trillion by 2023, the Indonesian government has strongly encouraged industry players in the country to enter this highly profitable market.
You may be wondering which sectors have the biggest potential and profits in the halal market. According to a report by Indonesia Halal Lifestyle Center (IHLC), 10 sectors are currently thriving as major halal businesses: food, fashion, education, pharmaceuticals, cosmetics, tourism, media and travel, medical and health, art and culture, and Sharia financial and banking industry.
Related article: Most Common Questions about Halal Certificate
Taking effect from October 2019, all businesses are required to obtain the mandatory halal certification. Labeling and quality measures for halal products will also be enforced under this new regulation. Halal certificates are issued by Halal Products Certification Agency (Badan Penyelenggara Jaminan Produk (BPJPH)).
Only businesses with halal certification will be able to prove that their halal products are in compliance with Sharia laws, thus permitting the products to be consumed or used.
Products included in this new law are goods and services related to food and beverages, cosmetics, pharmaceuticals, chemical and biological products, and genetically-modified products.
Though the halal certification process might seem cumbersome, Cekindo is able to simplify the process for you.
With Cekindo, the process to apply for halal certification in Indonesia is as follows:
Read also our in-depth guide on Securing Halal Certification in Indonesia.
One important point to note is that if you do not obtain halal certification for your products in Indonesia, even when they are halal, they will become non halal, with gradual implementation starting in October 2019.
This is why we urge you to register your halal products and obtain halal certificates as soon as possible. Get in touch with us today should you require assistance with your halal certification application in Indonesia by filling in the form below. Or visit our offices in Jakarta, Bali and Semarang.