The demand for Halal and ethical products and services is being driven by a global Muslim population which has grown significantly to one-quarter of the world’s population. Growing Muslim consumers coupled with the increased offering of Halal-certified products is expected to drive the global Halal market to reach $9.71 trillion by 2025.
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What is Halal?
Despite popular belief that Halal refers only to meat, the term refers to any action or behaviour permitted under Islamic law as prescribed by the Qur’an. As such, the Halal industry encompasses a much broader area of products and services, including personal healthcare, cosmetics, travel & tourism and financial services.
Global Halal Market
According to the State of the Global Islamic Economy Report 2018/19 produced by Thomson Reuters, the global number of Muslims in 2017 was 1.8 billion, making up 24% of the global population. This number is expected to increase by 70% in 2060, totaling 3 billion Muslims worldwide.
This substantial growth in the number of Muslim consumers, as well as the increasing demand from the non-Muslim population, is driving the global Halal market at an exponential rate. In 2017 the global Muslim expenditure across lifestyle sectors was estimated at $2.1 trillion. According to a forecast by Adroit Market Research, the global Halal market size is expected to reach $9.71 trillion by 2025.
This rapid growth spans across several sectors of the Halal market. One of the leading areas is the Islamic finance sector, with Islamic banking notably on the rise in the UAE and Malaysia. Global assets were estimated at $2.4 trillion in 2017 and expected to surge to $3.8 trillion by 2023.
The Halal food and beverage sector has more companies than any other sector of the Islamic economy. In response to the growing global consumption of Halal certified foods, multinational companies are turning their attention to the creation of a growing variety of Halal food brands. Global Muslim spending on food and beverages is said to be growing at 6.1% and forecast to reach US$1.9 trillion by 2023.
Modest fashion is another leading sector making waves across the world, and the second biggest spend by category. International retailers have launched their own modest fashion lines in response to the increased popularity of modest clothing.
Retailers tapping into the market include Macy’s in the USA, H&M worldwide and Nike, who now offer athletic hijabs in its Pro Hijab line. Muslim spend on clothing is forecast to reach $361 billion by 2023, a major jump from the $270 billion in 2017.
UK Halal Market
According to projections from the Pew Research Centre, the Muslim population in the UK is set to triple in 30 years, rising from 4.1m in 2016 to 13m in 2050. The UK Halal market is today worth $4.5 billion and is expected to grow 5% annually until 2020.
Halal Food
The growing Halal consumption has encouraged leading supermarkets and large-scale food manufacturers to enter the market. Major national grocery chains, including Asda, Sainsbury’s, and Tesco, are providing an ever-increasing variety of Halal-based products.
Waitrose launched dedicated vegan sections in more than 130 stores after increasing its vegan and vegetarian product range by 60%. Sainsbury’s sales of its vegan cheeses surpassed the company’s predictions by 300%. In 2018, gummy manufacturer Haribo opened its first Halal candy store in the UK.
As a reaction to the high demand for Halal food in the UK, there is a rising demand for more variety of Halal-friendly foods. Halal restaurants in London and fast food outlets are offering everything from salami and chorizo from Spain to HMC-certified, grass-fed Aberdeen Angus.
AHDB Beef & Lamb, the organisation for beef & lamb levy payers in England, estimated the total value of the UK Halal meat industry to be around £2.6bn a year. While Muslims in the UK represent just 3% of the population, they consume around 20% of all the lamb sold as well as a growing percentage of beef, most of which is Halal.
Modest Fashion
Modest fashion in the UK has grown in popularity as it moves into the mainstream, appearing everywhere from high-street collections to designer catwalks. According to the reports from Pinterest UK, searches for the term ‘modest fashion’ have increased by 500% since the beginning of 2019.
Major fashion retailers in the UK are embracing the modest fashion market. In 2018, H&M released an entire modest clothing collection called LTD Collection in an effort to appeal to a global consumer. Online retailer ASOS launched its own modest collection earlier this year, featuring a variety of hijabs, burqas and modest clothing.
Islamic Finance
The Islamic Finance sector in the UK is fast becoming a force to be reckoned with. Today, more than 20 banks in the UK offer Islamic services, and five of these banks are fully Sharia-compliant, including Al Rayan Bank. Currently, Al Rayan Bank provides Islamic financial products to more than 85,000 customers in the UK. Last year, it became the first bank in the world to issue a public sterling sukuk (Islamic bond) in a non-Muslim country.
The City of London is now the leading centre for Islamic finance outside the Muslim world, with assets of UK-based institutions that offer Islamic finance services totalling more than $5bn. It appears that Islamic finance is appealing to a wider audience, not just Muslims. It is believed that more than a third of Al Rayan Bank’s customers are non-Muslim.
Halal Events in the UK
In order to cater to the growing number of Halal consumers, Halal-based events have launched in Britain with great success.
In 2017, London hosted its first-ever Modest Fashion Festival, showcasing a wide array of luxury and contemporary modest fashion brands and proving that it can be enjoyed by all, regardless of religious or cultural identity. The London Muslim Shopping Festival returns for its fifth year in 2020, attracting tens of thousands of international guests for Europe’s biggest Halal food, fashion, and shopping event.
Another event is the Halal Expo London, the UK’s first international Halal B2B and Consumer Trade Show held at ExCel London. Over 15,000 professionals from around 50 countries are expected to attend to do business and network with more than 500 exhibitors, offering the latest products and services for the Halal market.
The event aims to provide an opportunity for participants to discover new entrepreneurial, investment and trade opportunities within the Halal economy. The expo has run a nationwide competition called “#pitchperfect!” to uncover budding start-up entrepreneurs and Halal focused SMEs. The winning competitor will receive a cash prize of up to £50,000 to be used as an investment in the rapidly growing Halal sector.