Potential and opportunities for Vietnamese businesses

Halal market - opportunities for businesses

On the morning of May 31, 2024, in Ho Chi Minh City, the Workshop "Promoting the export of Halal products of Vietnamese enterprises to the Malaysian market and Muslim countries" took place, organized by the City Investment and Trade Promotion Center (ITPC) in coordination with the Malaysian Consulate General in Ho Chi Minh City and the Malaysian Trade Promotion Agency.

The event was held to promote the export of Halal products of Vietnamese enterprises in general and Ho Chi Minh City in particular to the Malaysian market and Muslim countries.

Delegates attending the Workshop "Promoting the export of Halal products of Vietnamese Enterprises to the Malaysian market and Muslim countries" - (Photo: Thanh Minh)

Speaking at the opening of the workshop, Mr. Dao Minh Chanh - Deputy Director of the Ho Chi Minh City Investment and Trade Promotion Center (ITPC) affirmed that Vietnam - Malaysia still has a lot of potential to further promote economic , trade and investment cooperation. In 2011, Vietnam was only Malaysia's 14th trading partner with a total turnover of 7.2 billion USD, and was Malaysia's 15th largest export market, with an export value of 3.82 billion USD.

By 2023, the total two-way trade turnover between Vietnam and Malaysia will reach 12.67 billion USD. Of which, the export turnover from Vietnam to Malaysia will reach 4.86 billion USD. The two countries are striving to achieve the bilateral trade turnover target of 25 billion USD by 2030.

Mr. Dao Minh Chanh - Deputy Director of Ho Chi Minh City Center for Trade and Investment Promotion - (Photo: Thanh Minh).

Malaysia is currently a potential import market for Vietnam in the ASEAN region. In the first 4 months of 2024, the import-export turnover between the two countries reached 4.9 billion USD. In Ho Chi Minh City alone, in the first 3 months of 2024, the export turnover to Malaysia reached 178.782 million USD, an increase of 77% over the same period last year.

According to Mr. Dao Minh Chanh, trade cooperation with Malaysia in processing and exporting Halal food will help Vietnam not only exploit the Malaysian market but also expand exports to potential Middle Eastern countries as well as penetrate the global Halal market.

In particular, the Halal industry is currently growing strongly with about 2 billion Muslims worldwide , this is an opportunity for Vietnamese poultry products to expand the export market. In particular, establishing Halal standards from production to distribution is becoming an important trend, creating great opportunities for Vietnamese businesses.

In 2024, the Halal industry is forecast to continue to grow strongly in the Asian, Middle Eastern and African markets. Halal trends in 2024 will contribute to reshaping the global Halal business environment, creating new opportunities but also requiring businesses to quickly adapt to the new context.

With the trend of building a Halal value chain, the Halal market is shifting from a mindset of only caring about Halal products to building the entire Halal supply chain. Accordingly, Halal standards need to be expanded to control from the source to where consumers buy such as retailers, restaurants, and online shopping.

Mr. Firdauz Othman, Consul General, Consulate General of Malaysia in Ho Chi Minh City - (Photo: Thanh Minh)

Sharing at the workshop, Mr. Firdauz Othman, Consul General - Consulate General of Malaysia in Ho Chi Minh City expressed that today's program will mark a new turning point for the Halal market in Vietnam. Today, Halal standards have been globally accepted.

According to Mr. Firdauz Othman, the Halal market has been constantly growing to meet the growing needs of the world's Muslim population. Based on the Global Islamic Economy (GIE), the Muslim population is expected to increase from 1.8 billion people in 2017 to 3 billion people in 2060. And this huge market includes many fields such as: Food and beverage, finance, fashion, cosmetics, pharmaceuticals, tourism and entertainment.

The Halal food sector in particular is a rapidly growing market, forecast to be worth trillions of dollars by 2030. This market is fueled by the growth of the global Muslim population as well as the demand for Halal-certified products. This has created huge opportunities for many countries including Vietnam to proactively access the Halal market.

Barriers limiting businesses from accessing the Halal market

To help Vietnamese businesses better understand the Halal market, as well as its potential... at the workshop, Mr. Mohd Firdaus Mohammad - Deputy Consul of Trade, Malaysian Trade Office in Ho Chi Minh City and experts from the Muslim community updated the market overview, shared regulations, standards, and methods for obtaining certificates for these products, and answered related questions that businesses were interested in.

Dr. Phu Van Han - Deputy Director of the Southeast Institute of Social Sciences - (Photo: Thanh Minh)

Sharing experiences for Vietnamese enterprises to achieve Halal certification, Dr. Phu Van Han - Deputy Director of the Southeast Institute of Social Sciences - said that globally, this market is worth 7,000 billion USD, estimated to reach 10,000 billion USD by 2028. This is a large-scale market and the Halal industry is not limited to food products but now includes pharmaceuticals, cosmetics, medical products, personal hygiene products, medical equipment, etc.

Although this market is full of potential and opportunities, Vietnamese enterprises still have many difficulties and challenges to overcome in order to approach and penetrate it. Because the Halal market is considered difficult when the products of this market are always associated with specific and strict regulations of Islam.

Therefore, the barriers for Vietnamese enterprises primarily come from the incomplete understanding of Islamic culture, especially issues and contents related to aspects of consumer culture, business and regulations on products. Therefore, enterprises often encounter problems in farming, processing, preservation and product designs and brands that are not suitable for Islamic culture and do not meet the strict standards of the Halal market.

The global Halal market will bring in trillions of USD each year and will continue to increase, opening up great opportunities for Vietnamese businesses - (Photo: Thanh Minh)

Dr. Phu Van Han noted that the prerequisite for exporting products to this market is that Vietnamese enterprises must have Halal certification authenticated by competent authorities. However, this certification activity in the world and in Vietnam is facing some significant difficulties and obstacles.

Currently, there is no unified Halal standard applicable to all countries worldwide. In addition, although there are many organizations authorized to grant Halal certification, the certification procedures of these organizations are not unified. The fact that many organizations grant certification with different requirements between countries, along with many different standards for each product, has increased the complexity and challenges in production and business, causing great obstacles to the export of Halal products of Vietnamese enterprises.

Particularly in Vietnam, businesses find it difficult to obtain Halal certification as the standards and regulations on verification and certification are always strict, in addition, the certifications are not permanent and are not recognized equally in all countries and for all products.

Dr. Phu Van Han also added that the first thing is that businesses need to clearly understand and master the Halal standards of the certification organization they choose. The standards include strict requirements on raw materials, production processes, management systems and other aspects related to the products and business operations of the business.

Accordingly, production materials must be permitted according to Islamic law and the production process must ensure food hygiene and safety and comply with the principles of this market.

Building and implementing a quality management system in accordance with Halal standards, including processes for controlling input materials, production, storage, transportation and product distribution, requires businesses to consider and choose an organization that is suitable for their needs, target market and capacity (finance and conditions) to meet the certification.

In addition, to maintain Halal certification, businesses need to periodically check the management system, update changes in production processes or management systems, participate in training courses on Halal knowledge, and cooperate closely with the certification organization to resolve arising problems.

At the same time, businesses need to ensure that all products and business activities comply with the requirements. Violating Halal regulations can lead to the revocation of certification and seriously affect the reputation of the business brand. Businesses also need to regularly update changes in standards to ensure compliance and best meet Halal requirements.

Source: https://congthuong.vn/thi-truong-halal-7000-ty-usd-tiem-nang-va-co-hoi-cho-doanh-nghiep-viet-323444.html