Dedicated Halal Cluster launched in Dubai Industrial City
New zone critical in supporting the UAE’s vision to become a global hub for Islamic economies
February 24, 2014 4:22 by kippreport
Dubai Industrial City announced the launch of the Halal Cluster on Sunday (February 23), which will be dedicated to manufacturing and logistic companies from the food and beverages, cosmetics and fragrances, and personal care sectors.
The 6.7 million-square-feet-cluster is expected to attract at least 15 companies, particularly from the GCC and Mena regions. Moreover, according to Abdullah Belhoul, CEO of Dubai Industrial City, companies can sign up within a matter of a few months.
“This new hub is a critical building block to support the UAE’s vision to become a global hub for Islamic economies, without which it cannot aspire to have a holistic eco-system to support halal manufacturing and distribution,” says Sayd Farook, global head of Islamic capital markets at Thomson Reuters. “[It] will also further the UAE’s capability to diversify into a value-added manufacturing and processing [economy], a key differentiator for a country located at the crossroad, between consumers and producer markets.”
Muslim consumers spend more than $26 billion on cosmetics and personal care products, a figure that is expected to grow to $39bn over the next five years, says Belhoul. Meanwhile, according to Thomson Reuters’ State of the Global Islamic Economy Report 2013, Muslims spent approximately $1,088bn for food and non-alcoholic beverages in 2012 – which is 16.6 per cent of the overall global expenditure. In the GCC region alone, the food market is worth $85bn.
“Yet, despite the significant size of this consumer base, there are limited consolidated manufacturing or re-distribution players of core ingredients that have scale in deployment and distribution across these markets,” adds Farook. “For instance, halal gelatine, a common ingredient in many processed foods, is still barely touching two per cent of the global market share, being limited by the lack of halal raw materials.”
According to Farook, having a cluster manufacturing and distribution facility that is fully shari’a compliant and in such close proximity to more than two billion people in the region would mean that manufacturers have an added advantage. “Manufacturers with global ambitions to export ingredients and processed foods to the OIC markets will now have the capability to scale their halal operations like never before, while ensuring the integrity of their halal supply chains, which will be regulated by Dubai government’s certification bodies.”
He notes that these certification bodies are likely to follow globally accepted standards developed by the Emirates Authority for Standardaisation and Metrology (ESMA) and the Standards and Metrology Institute for Islamic Countries (SMIIC), “and, therefore, will make it easier for companies to export to a broad cross-section of Islamic markets”.
The Halal Cluster has been launched in partnership with the Dubai Islamic Economy Development Centre, the ESMA and Dubai Municipality. It will have an independent industrial block, along with warehouses, showrooms and accommodation units.
Dubai also has plans to set up a new International Centre for Halal Food and Product accreditation, according to an announcement made last month, which will undertake tests for halal foods and products to ensure they are free from chemicals and artificial additives.