Opportunities and Challenges of Cross-Border Halal Economy Trading

Regulatory harmonisation and market access remain significant challenges in the Halal market as different countries have varying Halal certification requirements, which can complicate trade. There isn’t a singular global body that monitors these standards. For example in Singapore, we have the Majlis Ugama Islam Singapura (Muis),; Malaysia has JAKIM and Indonesia has the Indonesian Council of Ulama (MUI). Several nations in the Middle East with sizable Halal consumer bases are also members of the Gulf Cooperation Council (GCC). Businesses must navigate the different regulatory landscapes to ensure compliance and market access. Maybank, with its extensive regional network, is no stranger to assisting companies in understanding and meeting these diverse certification requirements, thereby easing the complexities of cross-border Halal trade. For example, Maybank’s Halal Network and Certification Advisory facilitates companies in getting Halal certification. In addition, Maybank also provides Islamic financing solutions for customers for their business operations such as working capital financing.

Partnerships and trade agreements among ASEAN nations also play a vital role in facilitating this trade. One such example is the Johor-Singapore Special Economic Zone (JSSEZ) for which an MOU was signed in January 2024. Billed by Maybank as a game-changer, JSSEZ aims to enhance economic integration and streamline trade between Malaysia and Singapore. In support, Maybank will leverage its extensive regional network to provide tailored financial solutions, facilitate cross-border partnerships, and offer specialized advisory services that navigate regulatory compliance. Additionally, Maybank’s digital platforms, sector-specific support, and strategic market insights help businesses optimise operations and expand within the region.          

“At Maybank, we see ourselves as powering the continued growth of the Malaysia-Singapore corridor through facilitating cross-border business services, solutions and digital networks to support our clients’ business needs,” said  Alvin Lee, Country CEO of Maybank Singapore.

Singapore as a Regional Halal Trading Hub

Singapore, with its strategic location and robust infrastructure, is poised to become a key Halal trading hub. The city-state consistently ranks top 10 in the Global Islamic Economy Indicator.

With 15 per cent of its population being Muslim, and a total of 4,938 Halal-certified food and beverage (F&B) establishments, Singapore has a well-established ecosystem to support the Halal industry . While Halal businesses make up the ecosystem, banks also have a large role to play in ensuring this ecosystem is stable and growing: Maybank’s expertise in Islamic finance positions it as a crucial partner for businesses looking to capitalise on these opportunities to flourish and grow.

Singapore's Muis Halal certification is well-recognised internationally due to its rigorous standards. This recognition, in addition to Singapore’s role in facilitating cross-border partnerships and trade agreements within the ASEAN region, enables companies who set up base in Singapore to expand their Halal-certified businesses regionally and globally. After all, Maybank has presence in all ten ASEAN member countries.

Furthermore, among the city-state’s consumers, there is also an increasing demand for Halal products and services. Nine per cent of total consumer spending in Singapore in 2022 was spent on halal products and services and the number of Halal-certified F&B outlets in Singapore has also increased every year on average from 2018 to 2022, due to consumers’ increasingly diverse tastes, among other factors. Singapore has also been ranked as the top Muslim-friendly travel destination among non-Muslim countries for the ninth consecutive year - underscoring its unwavering dedication to cater to Muslim travellers by promoting widespread availability of Halal food, prayer facilities, suitable airport amenities, and Muslim-friendly accommodation.

Having been established in Singapore since 1960, Maybank has been at the forefront of this city-country’s transformation journey towards becoming a key halal trading hub, and will continue to be. 

Navigating the Growth of the Halal Economy with Maybank

Maybank's comprehensive Halal banking services extend beyond traditional banking, offering advisory support to companies exploring the Halal economy both locally and regionally.

The bank’s expertise in Islamic finance and its strategic initiatives, such as supporting the JSSEZ, underscore its commitment to facilitating business growth within the Halal market, locally, regionally, and globally.

With Maybank as a partner, businesses can navigate the complexities of Halal certification, regulatory compliance, and cross-border trade, ensuring they can seize the opportunities within this expanding economy in Singapore and beyond.

For more information on how Maybank can assist in navigating the Halal economy, visit Maybank's Halal Banking Services.