Consumer spending in Islamic economy sectors forecast to rebound by end-2021, market size slated to reach US$2.3 trillion by 2024

Takeaways from the State of the Global Islamic Economy Report 2020/21 will be unveiled at Reimagine: Halal in Asia 2020, providing insights on capturing opportunities in the resilient Muslim market

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• Malaysia (#1) once again tops Global Islamic Economy
  Indicator for the eighth year. New entrants to the top 15 include Singapore,
  Sri Lanka, and Nigeria.
• Travel worst hit while food segment fares the best; global spend on Halal food and beverage
  forecast to hit US$1.38 trillion by 2024.
• Investments in Islamic economy-relevant companies
  totalled US$11.8 billion in 2019/20, a decline of 13 percent compared to the
  previous year. Indonesia (#1)
  and Malaysia (#2) ranked ahead in terms of investment activities, while Halal
  food sector expanded by 219% to $6.3 billion in total deal value.
• 33 key signals of
  opportunities identified including: tokenisation of sukuks (Islamic bonds)
  within Islamic fintech, supply chain shifts, food security investments,
  nutraceutical demand, domestic tourism, and accelerated digital transformations.

 

SINGAPORE
– Media OutReach – 1 December 2020
– CollabDeen and #HaveHalalWillTravel, Singapore-based Halal lifestyle digital platforms,
in partnership with DinarStandard, a US-based research and advisory firm, are hosting
a Southeast Asia launch of the State of the Global Islamic Economy Report
(SGIE) 2020/21 at the inaugural Reimagine: Halal in Asia 2020
virtual conference on 2 and 3 December 2020. Under the theme of
‘thriving in uncertainty’, the eighth edition of the Report is supported by the
Dubai Islamic Economy Development Centre (DIEDC) and presents an annual update
on the Islamic economy, encompassing Halal products, Islamic finance, and lifestyle
sectors and services.

 

This
year’s SGIE Report, produced by DinarStandard, estimates that Muslims spent
US$2.02 trillion in 2019 on food, pharmaceuticals, cosmetics, modest fashion,
travel, and media. While this spending reflects 3.2 percent year-on-year
growth, Muslim spending in 2020 is forecast to contract by 8 percent due to the
impact of the pandemic. However, spending, excluding travel, is forecast to
rebound by end 2021, and is slated to reach US$2.3 trillion by 2024, at a
cumulative annual growth rate (CAGR) of 3.1 percent. Islamic finance assets are
estimated to have reached US$2.88 trillion in 2019 and are estimated to remain
at the same level in 2020.

 

In
the Report’s Global Islamic Economy Indicator that evaluated 81 countries this
year — Malaysia (#1), Saudi Arabia (#2), the United Arab Emirates (#3),
Indonesia (#4), and Jordan (#5) lead the rankings. The rankings recorded improvements
by Saudi Arabia and Indonesia and welcomed new entrants Singapore, Sri Lanka,
and Nigeria in the top 15. The indicator measures how leading national
ecosystems are best able to support the development of Islamic economy business
activities.

 

Fateh
Ali, Co-founder & CEO of CollabDeen, said: “Singapore’s entry in the top 15
signals both the important role and the momentum of the Islamic economy for
Singapore. Singapore’s strong performance in Halal products as well as the
media and travel segments are positive signs of Islamic economy’s role in
economic revival post-pandemic. Singapore’s share in the over $255 billion per
year global Halal trade, as highlighted in the Report, is a significant
$2.4 billion, which represents 1% of the total and shows potential and room for
growth. Post-pandemic,there
will be a rise of disruptive technologies in the digital Islamic economy,
unlike anything we have been able to do up until now.”

 

Mikhail
Melvin Goh, Founder of #HaveHalalWillTravel, said: “The whole Southeast Asia
region is a critical player in the global Islamic economy. In addition to
market leaders like Malaysia and Indonesia, Singapore, Thailand, Philippines,
South Korea, and Brunei were prominently highlighted in the Report as well.
Thailand’s #14 ranking globally in Halal products export of $6.2 billion (ahead
of Malaysia) and 4.48 million estimated Muslim tourists in 2019 (ahead of
Indonesia’s) is indicative of the robust regional Islamic economy ecosystem
that has developed strongly over time.”

 

Following
a record year in 2018/19, investments in Islamic economy-relevant companies globally
slowed in 2019/20, dropping by 13 percent to US$11.8 billion. Over 54 percent
of investments were within the Halal products category, while Islamic finance
and Islamic lifestyle attracted 41.8 percent and 4 percent of the investments
respectively. Growth figures were driven by corporate-led mergers and
acquisitions, venture capital investments in tech start-ups, and private equity
investments.

 

Abdulla
Mohammed Al Awar, CEO of Dubai Islamic Economy Development Centre (DIEDC),
said: “The SGIE Report is an annual publication that has gained traction as a
trusted and ready reference on the global Islamic economy, and contributes to
strengthening Dubai’s position as the global capital of Islamic economy. In
these uncertain times, the Islamic economy, with its ethical and transparent
ecosystem, remains a pillar of strength and a guarantee for a better future. As
we look ahead, the values and principles the Islamic economy is based on,
coupled with the carefully identified ‘signals of opportunities’ and the clear
recommendations within the Report, provide a roadmap for governments and
companies to navigate challenges seamlessly, continue along their path to
recovery, and stay on course for long-term prosperity.”

 

Rafi-uddin
Shikoh, CEO and Managing Director of DinarStandard, said: “This year’s SGIE
Report highlights the emerging opportunities that stand out amidst the
repercussions of COVID-19, such as global supply chain disruptions, job losses,
health services crises, and food security challenges. The 33 ‘signals of
opportunities’ identified in the Report, include the tokenisation of sukuks
within Islamic fintech and accelerated digital transformations across all
sectors prompted by the COVID-19 pandemic. Other signals identified pertain to Halal
products, supply chain shifts, food security investments, and nutraceutical
demand.” 

 

The
SGIE Report also continues to highlight Islamic economies’ social impact
developments in addressing the United Nations’ Sustainable Development Goals
(SDGs) including initiatives addressing the poverty and food security crisis exacerbated
by the COVID-19 pandemic.

 

The
SGIE Report 2020/21 has been produced in partnership with SalaamGateway.com,
the largest Islamic economy news and media platform. Strategic partners of this
year’s SGIE Report include The Islamic Food and Nutrition Council of America
(IFANCA) and CIMB Islamic, the CIMB Group’s Islamic banking and financial
services franchise.

 

Transcending
religious and cultural boundaries at Reimagine: Halal in Asia 2020

With a
vision of fostering peace and understanding between communities, CollabDeen
and #HaveHalalWillTravel are hosting Singapore’s first-ever virtual conference
on the Islamic economy from 2 – 3 December 2020. It aims to bring together
industry leaders, innovators and entrepreneurs — regardless of faith — to learn
more about engaging with Muslim consumers and building a stronger Halal
ecosystem for continued growth in the region.

 

The 2-day programme
features an insightful line-up of over 30 speakers from around the world to
provide fresh perspectives on tapping into the Islamic market that has gained
broad and universal appeal, from bringing ready-to-eat halal food into the
Japanese market to transforming the tourism sector. For more information on the
event, please visit: https://reimaginehalal.com/

 

Note to editor:

The
full State of the Global Islamic Economy Report 2020/21 is available for
download at https://www.salaamgateway.com/specialcoverage/SGIE20-21.