THE HALAL CONCEPT AND DEVELOPEMENT IN MALAYSIA 1.

0 Introduction

It must first be stated that the Islamic dietary and consumption system is different and unique compared to other ethnic dietary systems. The world community has now begun to understand the importance of the Muslims requirement for food and other consumption known as Halal. The market for certified Halal food and products is growing robustly, both domestically and internationally. Although the term Halal has never attracted as much attention as in recent times, today, wherever there are Muslim consumers whose tastes and preferences are governed by Halal rules on food specification, a Halal food market exists. Every Muslim must ensure that what they eat comes from a Halal source. This does not mean only to check the ingredients per se, but also to ensure that the whole process is in accordance with Shariah principles. As Muslims constitute the largest population in Malaysia it has given them many advantages. However, being cheated concerning non-Halal and Halal, as in labelling non-Halal as Halal has raised the sensitivity of many Muslims in this country. It is not easy to investigate for oneself as many Muslims buy food that has already been packaged. Because of the difficulty in determining the Halal status, muslims depend on the responsible authority to check the status on their behalf. Manufacturers and marketers on the other hand, use Halal certification and logo as a way to inform and to reassure their target consumers that their products are Halal and shariahcompliant. In general, the Muslim consumers in Malaysia look for the authentic Halal certification issued by the Malaysias Department of Islamic Development (JAKIM) which is
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under the purview of the Ministry in the Prime Ministers Department. This certification granted the companies the use of Halal logo for printing on their products packaging or for the display at the companys premise. Given the speed of trade globalization, the advancement in science and technology, the continuous change in products formulation, and the on-going initiatives to simplify manufacturing processes, it is essential that the Halal concept be fully understood especially by the marketers of consumer goods be it for food or for non-food product categories. This is important because as the consumers become more religious or Halal-conscious, they will be looking for products that not only satisfy their needs but also give them peace of mind.

2.0

The Halal Concept

Islam places a very strong emphasis on cleanliness in everything. As such, before performing our daily prayers, ablution, as means of cleansing ourselves, is compulsory, and must be performed in the correct manner. The concept of cleanliness is also extended to toher matters, especially in context of food and drink. The Qur'an has numerous injunctions, instructing Muslims to choose and consume good and wholesome foodstuffs. The Halal standard that guards the Halal concept is crucial to control the safety and quality of consumable materials from the process of production to consumption. Consumable materials could range from food, drinks, cosmetics, medicine, detergents, soaps, shampoo, and deodorants to antiperspirants for human beings, and feed for animals.

To be considered religiously lawful and thus certified as Halal, Muhammad Munir Chaudry & Hani Mansour Mosa Al-Mazeed (2010) have suggest a few requirements that the consumable products must fulfill, such as: 1. Does not contain any parts or products of non-Halal animals (animals which are not allowed to be eaten by Muslims) 2. Does not contain any parts or products of Halal animals (such as cattle, goats, sheep and poultry) that were not slaughtered according to Islamic law (Shariah) 3. Does not contain any ingredients that are Najs (filthy or unclean) according to Islamic law. 4. Is safe and not harmful (does not contain physical, chemical, or biological/ microbial hazards 5. Is not prepared, processed or manufactured using equipment that is contaminated with things that are Najs according to Shariah. 6. The ingredients do not contain any human parts or its derivates. 7. During its preparation, processing, packaging, storage or transportation, the product is physically separated from any other product that does not meet the requirements stated above or any other things that have been decreed as Najs by Shariah. Having understood what Halal is, a person involved in Halal production should always be cautious of Mashbooh (dubious) ingredients or be attentive to areas of primary concern to establish that the Halal concept covers the entire supply chain. Importantly, one of the daily
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consumable products According to Hayati et. al. (2008) Meat Products should also ascertain the following: 1. What type of animal is being slaughtered (Halal/ non-Halal). 2. The type of feed the animal was being fed before slaughter: What were the raw materials of feed formulation made of? Does it contain protein supplements of things that are Najs according to Shariah such as from porcine origin, meat from dead animals as leftover from slaughterhouses, and animal filth such as urine and manure; and does it contain residues of antibiotics and growth hormones? 3. The slaughtering method; when the slaughtering process is undertaken in modern slaughterhouses, stunning versus no stunning, manual versus mechanical slaughter, cutting the three or four vessels in the neck, and for some Muslim schools, facing Mecca and the use of iron knives, as well as meeting any other requirements of the importing country; and finally, which is very important. 4. Logistics: the implementation of a Halal system including isolated storage, and ensuring that the Halal process is not contaminated by non-Halal processes should they occur within the same vicinity).

2.1

Halal According to The Quran Halal, which means permissible or allowed in Arabic, is essentially a way of life and

is not solely confined to the types of food that a Muslim is allowed to consume, though food is a

vital component for the sustenance needed to lead a meaningful life. The bottom line is that Halal food is not just about what the food is but how it is prepared. The Halal concept emphasizes safety, hygiene and wholesomeness of food. It also provides an excellent platform for healthy eating. Consideration of the place and process of the animals being slaughtered and most importantly, the condition of these animals would not endanger the health of diners, are a prime focus of what Halal is all about. By definition, Halal consists of anything that is free from any component that Muslims are prohibited from consuming. In this era of technology, the concept of Halal can no longer be restricted to simply meaning food that is pork free in its physical existence. It covers a multitude of forms such as emulsifiers and other food substances such as gelatine, enzymes, lecithin, and glycerine as well as additives such as stabilizers, flavouring, colouring, breadcrumbs etc. In recent developments in food technology, the one that has been given the most attention is genetically-modified food or GM food (Mohd Saifudddeen, 2002). As a matter of fact, the sources of food may come from a Halal animal that has been slaughtered according to Islamic rites. The Quran, as the ultimate source of every hukm has stressed this issue, to the effect that: O ye people! Eat what is on earth, lawful (Halal) and good (tayyib)... (Surah al-Baqarah, 2:168) From this verse, it is understood that Islam sets two essential criteria for food consumption, namely, Halal (permissible by the Shariah) and tayyib (of good quality).

Further in the Quran in the same surah, it has been mentioned that: O you who believe! Eat of the good things that we have provided to you, and be grateful to God, if it is He ye worship. He hath only forbidden you dead meat, and blood, and the flesh of swine and that on which any other name hath been invoked besides that of God. (Surah al-Baqarah, 2:172-173) It is clear from the above ayat that eating food that is Halal and the avoidance of what has already been forbidden, haram, is an obligation to every Muslim. It is understood that each and every hukm laid down in the Quran has its own reasoning and must not be taken for granted.

3.0 3.1

The Halal Certification System Halal Certification and Logo The basic principles of Halal certification are Halal (permissible) and Thoyyibban

(wholesome) taken from Al-Quran, verse 168 Surah Al-Baqarah. Halal is an Arabic word which means allowed or permitted according to shariah (Islamic) law (Lokman, 2001; Shaikh Mohd, 2006). On the other hand, Thoyyibban means good quality, safety, cleanliness, nutritious and authentic (Shaikh Mohd, 2006; Mariam, 2006). Halal and Thoyyibban themselves, portray the symbol of intolerance in the hygiene, safety and quality. The Halal certification is issued based on the basic principles and procedures that the products must be good, safe and fit to consume. According to Nurul Huda et al. (2009), Singapore, Thailand and Indonesia are among the countries that have their own Halal certification body. For instance, Mohamad Sadek (in Nurul
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Huda, 2009) stated that Singapore started their Halal certification services in 1972 that managed by Majlis Ulama Islam Singapura (MUIS). MUIS is responsible in regulatory function in Halal certification. He also identified three government agencies that collaborate with MUIS in Halal certification and enforcement, namely Food Control Department, Ministry of Environment; Agro-Veterinary Authority, Ministry of National Department and Commercial Crime Department, Ministry of Home Affairs. Further, according to HDC, source from Halal Standard Institute of Thailand, the Central Islamic Committee of Thailand is responsible for Halal certification of slaughtering houses, process food and services. This Committee, in cooperation with the Thai government producing Halal food standard and issuance the Halal symbols. The Halal certificates and logos are issued by the Committee that complied with the Islamic requirements.

3.2

Halal Certification System in Malaysia In Malaysia, the Halal certification and logo are issued by a body that is authorized by

the Malaysian government. Malaysia is the only country whose Halal certification is issued by the Government, unlike in other countries whose certifications are endorsed by their respective Islamic associations. JAKIMs Halal logo is now among the most widely recognized and respected symbols of Halal compliance in the world (Adam, 2006). The launching of the Malaysian Halal Standard MS1500:2004 in August 2004 further demonstrates the Governments commitment to the creation of clear and practical guidelines for Halal compliance. This MS1500:2004 is developed in accordance with ISO methodologies and

is the first Halal Standard to be developed by a Muslim nation. After several years of dedicated hard work, the National Body of Standardization and Quality (SIRIM) has completed the Malaysian Standard MS1500, General Guidelines on the Production, Preparation, Handling and Storage of Halal Foods, which includes compliance with GMP (Good Manufacturing Practices) and GHP (Good Hygiene Practices). This new standard will further strengthen Malaysian Halal certification which is already the longest established and most widely recognized registered Halal logo in the world (Badawi, 2004). The government controls the system with support from multi-agencies that lead by Department of Islamic Development Malaysia (JAKIM). JAKIM is a body that plays a significant role in Halal certification efforts in Malaysia. Since 1994 until 2008, JAKIM is an authorise body to handle the certification process (JAKIM, 2008). Besides, the State Islamic Religious Department (JAIN) and State Islamic Religious Council (MAIN) have the authority to issue the Halal certificates and logos for domestic market (JAKIM, 2008). The Halal certification is issued according to three categories of application. The three categories are 1) Product/ Consumer Good, 2) Food Premise and 3) Slaughter House/ Abattoir. Additionally, the premise inspection in terms of the product processing, handling, storage, equipment and distribution is mandatory procedure before the Halal certificate is approved. The Halal certification will be issued if this basic principle and procedure are complied and revoked if not complied. To date, JAKIM is no longer responsible for issuing the Halal certification. In 2004, The Malaysian Standard Halal Food (MS1500:2004) has been cited by Codex Alimentarius Commission as the best example in the world in terms of justification of Halal food. As Malaysia is positioning itself to be the Halal food hub center by 2010, Malaysia needs to act fast to strengthen the Halal certification services. Due to this, in April 2008, the
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government has appointed Halal Industry Development Corporation (HDC) as a body to handle local and international Halal certification process (HDC Vibe, 2008). HDC is a private company wholly owned by the Malaysian government. It was established in 2006 to facilitate the Malaysians Halal hub project. According to Bernama (2008), quoting Datuk Dr Ahmad Zahid Hamidi the Minister in the Prime Ministers Department, stated that the transformation from JAKIM to Halal Industry Development Corporation (HDC) was to help better coordination, to increase the efficiency of the Halal certification processes and to avoid international confusion. This would help position Malaysia as a global Halal hub center by 2010. According to Ahmad Shahrul (2008), until October 15, HDC had successfully certified 637 companies which 627 was local companies and 10 for international companies.

4.0

Reason to Position Halal-Hub in Malaysia With the introduction of MS1500:2004 certification, Malaysia is trying to promote a

standard which can be replicated by other countries as a coherent yard stick for Halal certification. The first step for Malaysia to position them as Halal hub is hosting a forum and debate in Halal product and services. As competitive free trade environment, which dominates the world economy, it is crucial for global Halal industry players to ensure that Halal food products and services find their own strength and capitalize on their market niche. Halal" is an Arabic word meaning lawful or permitted and can generally be translated as permissible or allowed in English. The opposite of Halal is Haram, which means unlawful

or prohibited. Halal and Haram are universal terms that apply to all facets of life. Contrary to popular belief, the word Halal is not only used in the context of consumables or products used by the Muslims. As stated before, it has a wide range of application. From inter human relationship, clothing and manner, social and business transaction, trade and financial services to investments or any others which is parallel to guidance specified by Islam (MITI Online, 2004). Halal issue is starting to make its presence felt, and Halal is the new defining market force in most Islamic countries. With Muslims now making up close to a quarter of the world's population, it should really come as no surprise that Halal is starting to have a significant impact on global markets. This new market force is driven by several factors. Firstly, many Muslim nations are reaching a stage of development whereby they can begin to impinge on world markets, both as producers and consumers. Secondly, and significantly, items such as Halal meat and Islamic banking services are increasingly popular among non-Muslims, enhancing the wide-spread rapid growth in these industry sectors (The Asian World Street Journal, 2005). The Halal marketplace is emerging as one of the most lucrative and influential market arenas in the world today. Geopolitical events, public interest, food related health scares and overall consumer demand have converged to push the Halal issue into the forefront of consumer awareness worldwide. In fact, the most important engine of growth of the Halal is a shift of perception. Halal food, for example, has been around for over fourteen hundred years, but it is only in recent decades, and particularly in multi-cultural societies, that the labeling and branding of Halal products has developed. Obviously, Halal is no longer just a purely religious issue; it is becoming a global symbol for quality assurance and lifestyle choice.

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The global market for Halal goods and services is developing into a powerful force in the arena of world commerce and finance. Halal Products and Islamic Financial Services represent a combined strength of over one trillion USD annually, and market monitoring indicates that the current strong growth trends can be expected to continue over the next five to ten years (The Asian World Street Journal, 2005). The Halal business industry constitutes 112 countries, catering for 1.8 billion Muslim populations, amounting to close to USD 300billiom (News Edge, 2006). The best thing is, Muslims are not the only one consuming Halal products. The potential in this market is tremendous. Based on the research done by Halal Industry Development Corporation (HDC), they found that the acceptance towards Halal product was increasing not only among the Muslims but also among the non-Muslims.

4.1

Suggestion for Strategies Adopt To be the central trading hub for Halal products, we would like to highlight the idea of Nik

Maheran Nik Mahmod et al. (2009) that suggested a few strategies to be adopted which are intelligent marketing and strategic supply chain orientation as well as structured through Halal Assurance system.

4.1.1 Supply Chain Strategy Supply chain management is "the systemic, strategic coordination of the traditional business functions within a particular company and across businesses within the supply chain. Its

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main objective is to improving the long-term performance of the individual companies and the supply chain as a whole' (Mentzer in Nik Maheran Nik Mahmod et al. , 2009 ).

4.1.2 Halal Assurance System Halal Assurance System is a system, which must be implemented by a producer or company to assure that the products produced are Halal. This system is set up based on three zeros concept, i.e., zero limit (no haram material used in the production), zero defect (no haram product is produced) and zero risk (no disadvantageous risk should be taken by the producer or company) (Chaudry, et.al in Nik Maheran Nik Mahmod et al., 2009). For any producer or company who are willing to produce Halal food or ingredient, they must set up a Halal assurance system. The system consists of five components, i.e., standard of Halal management and Halal system, standard audit of Halal system, Haram Analysis Critical Control Point (HrACCP), Halal guideline and Halal database. The general guideline of all of these components must be written and documented in one manual called Halal manual. The manual includes also Halal policy of the producer and objectives of the system. The commitment of the producer in producing of Halal foods consistently can be reflected from this manual. Hence, for a company producing Halal product, the structure for Halal-assurance systems play a critical role in integrating the processes that facilitate the creation of value within firms and across the supply chain. The assurance system integration between firm is enables the entire supply chain to become responsive to end-customer needs, potentially producing product with Halal certification as a means to satisfy customer needs. Thus, effective Halal-assurance

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system investments can create competitive advantage for a firm within and across the supply chain as a capability for creating value.

4.1.3 Marketing Intelligence Marketing intelligence system is a set of procedures and sources used by managers to obtain their everyday information about pertinent developments in the environment in which they operate. The marketing intelligences system supplies data about the market (Kotler in Nik Maheran Nik Mahmod et al., 2009). The fundamental purpose of marketing intelligence is to help marketing managers make decisions they face each day in their various areas of responsibility. According to Nik Maheran Nik Mahmod et al. (2009), first of all producers of Muslims products must understand and study the supply chain and the production process. Whether it supplying canned food to the Middle East, or Halal cosmetics to the Americas, they must be able to penetrate the whole supply chain. Malaysian Standard MS1500, General Guidelines on the Production, Preparation, Handling and Storage of Halal Foods, which includes compliance with GMP (Good Manufacturing Practices) and GHP (Good Hygiene Practices) will further strengthen Malaysian Halal certification which is already the longest established and most widely recognized registered Halal logo in the world. On the other hand, supply chain strategy is an iterative process that evaluates the cost benefit trade-offs of operational components. An organization may choose a strategy directed at supplier management as a way to remain competitive and establish network with supply chain partners, including suppliers,

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distributors, customers, and even customers customers. And for all these reasons, a well executed supply chain strategy results in value creation for the organization. (A UPS Supply Chain Solutions, White Paper, 2005) and hence position Malaysia as Halal-hub.

5.0

Non- Muslims Awareness of Halal Principles Today, Halal is no longer a mere religious obligation or observance, but is considered as

the standard of choice for Muslims as well as non-Muslims worldwide. The Halal concept is not unfamiliar to non-Muslims, especially those in Muslim countries. A good example of consumers awareness and understanding with regards to the Halal concept of food products is the rapid increase in annual sales in Halal stores throughout Moscow, Russia, from USD45 in 2004 to USD70 million in 2006 , a sum that is expected to hike to USD100 million in 2008 (Muhammad, 2007). According to Canadian Agri-Food Trade Service Report (2008), there is a strong demand for Halal products in a number of non-Muslim countries for both groups of consumers. The Halal products are also growing in popularity among non-Muslim consumers due to humane animal treatment concerns and the perception that Halal products are healthier and safer. Non-Muslim Russians made purchases from Muslim stores because they believe the products are fresh, safe and infection free, and had confidence that Muslims would adhere to their religious belief not to cheat. In the Philippines, non-Muslims also tend to prefer foodstuffs stamped with the Halal logo for health reasons. The public relations office of Victoria Foods Corporation one of the many firms with Halal certification claimed that an increasing number of Filipinos are becoming health-conscious. Filipinos are now looking for Halal products, which they believe to be safe, healthy and good to be consumed (Muhammad, 2007).
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5.1

Non- Muslims in Malaysia Awareness of Halal Principles In Malaysia, generally a lot of non-Muslim consumers still view Halal labeled food

products from a religious perspective. (Malaysia is a multi racial country with 62% of the population made up of Malays who are Muslim, 24% are Chinese who are either Buddhist or Traditional Chinese religions and 8% are Indians and their main religion is Hinduism (Golnaz R. et al., 2010). Both Chinese and Indians are not concerned about whether the food that they consume is Halal or not. It does not affect their consumption patterns even if the product is Halal). They have yet to appreciate the underlying advantages that come with Halal products which include a hygienic process Halal products have to undergo before reaching the market. In addition to this, Halal products have to undergo a thorough inspection to ensure a clean and hygienic manufacturing process. According to Muhammad R. (2007) Halal values can be popularized among non-Muslim consumers if the society at large is made to be more aware of issues concerning health, animal rights and safety, the environment, social justice and welfare. The consumption of Halal food for non-Muslims is quite different from the consumption of regular food or other foods for non-Muslims. A study conducted by Golnaz R. et al. (2010) to explore the non-Muslim consumers perceptions and attitudes towards Halal concept and Halal food products in Malaysia shows that in general, the awareness of Halal principles and Halal food products is determined by a positive attitude, the pressure of others and the perceived control. Meanwhile some perceived control factors like animal welfare do influence Halal food principles negatively. Possibly, the importance or personal relevance attached to Halal food (especially meat products) is that the non- Muslim consumers might find the idea of Halal to be more on how the animals are slaughtered.

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According to the finding of the study as well, Non-Muslims would more likely think of it as cruelty to animals, believing the animals suffer disproportionately for approximately two minutes prior to death, having allowed the slaughtered animals to bleed to death. However, the Islamic principles of slaughtering clearly state that the knife used for slaughter must be very sharp, to ensure a quick, deep and clean cut through the vital anatomy of the neck of an animal mainly the trachea, esophagus and major blood vessels. Meanwhile some recent studies indicate that the Direct Method of slaughtering an animal, which is the Islamic method of Zhabh (), is more merciful compared to the conventional method in the West, whereby the animal is stunned with a captive bolt pistol before being slaughtered. The religious and safety concepts associated with the Halal food probably make this decision more important for consumers, which could lead to a different decision-making process, including a specific set of predictors. While the main determinants that might have positive impact or associated with Halal principles of food products among non-Muslim is their lifestyle. With the finding of the study conducted by Golnaz R. et al. (2010), we can conclude that in general, a positive personal attitude towards the consumption of Halal food, the influence of the perceived control (food safety and environmentally friendly) over consuming Halal food contribute to predicting the intended consumption of Halal food among non- Muslims. The findings of this study also indicated that religious belief, food safety, animal welfare, environmentally friendly, age, education level and area of residence are significant determinants of the consumers attitude towards understanding and awareness of Halal principles and Halal food products. Despite an increasing trend in attitude and intention to purchase Halal food products, the study also finds that there is no significant evidence the non- Muslim consumers

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are absolutely aware of underlying advantages that come with Halal food process Therefore practical implications extend to food policy decision-makers and food marketers who might pursue identity- and/or acculturation-related strategies in their distribution and communication efforts targeted at the growing Halal food market segment among non- Muslim consumers in Malaysia. In addition, understanding the why and how consumers perceive Halal food products can lead manufacturers to increase their level of awareness and knowledge on Halal principles and Halal food process in order to gain the most efficient way of communicating marketing information to their consumers.

6.0

Conclusion For most Muslims, it can be said that the concept and understanding of Halal is very

clear and that Halal food is given the highest attention by Muslims in general as it is regarded as a sensitive issue. Many issues on Halal have been addressed, some of which are a cause of sensitivity among Muslims. It is already known that only a small percentage of the Halal manufacturers are Muslims. Given the speed of trade globalization, the advancement in science and technology, the continuous change in products formulation, and the ongoing initiatives to simplify manufacturing processes, it is essential that the Halal concept be fully understood, especially by the marketers of consumer goods be it for food or non-food product categories. From the discussion above, it is a well established fact that Malaysia is doing its best to promote itself into becoming a major player in the Halal industry. The taking over of the Halal administration from JAKIM by the HDC is seen as a positive change in order to place Halal matters fully under one central agency. Not only is it hoped that it will smoothen the structure,
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but also to advance Malaysia as a role model to other countries wishing to join the link. Indeed, the Malaysian Halal Standard MS 1500 has been adopted by several OIC members. Since the average global Halal food trade is estimated at RM600 billion per year, there is tremendous potential in the development and production of Halal products and greater efforts must be made to gain and expand the market. Many countries view Malaysia as a comprehensive increment for value as well as a certification centre; therefore making Malaysia ready to materialize it.

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