On 16 October 2023, Department of Trade and Industry (DTI) Secretary Fred Pascual signed a Memorandum of Understanding (MOU) with DK P.O. Fulfillment Company, Inc. (DKPO), a non-interest financing service to address the development of the Halal industry in the country, particularly for micro, small, and medium enterprises (MSMEs) held at the Kingsford Hotel.
The DTI chief emphasized that the development of the Halal industry is expected to generate PHP 230 billion in Halal trade and investments while creating over 120,000 job opportunities for Filipinos in five years.
Secretary Pascual said, “Our micro, small, and medium-sized enterprises, or MSMEs, are at the forefront of our Halal initiatives, poised to reap significant benefits. The Department of Trade and Industry (DTI) is taking substantial steps to champion its growth in this domain.”
The trade and industry chief underscored that the Halal industry development initiative forms part of the DTI’s four priorities, specifically – (1) promoting regional development; (2) attaining food security; (3) upgrading, upskilling, and upsizing micro, small and medium enterprises; and (4) enabling job skills matching and skills upgrading.
The global Halal industry is a multi-trillion market growing at a constant pace, considering the growing Muslim population of 1.9 billion people.
Projections indicate that by 2025, the market value is expected to surge to USD 7.7 trillion.
Further, the global Halal economy has expanded to cover not only the food and beverages sector but the entire lifestyle industry ranging from clothing, pharmaceuticals, cosmetics, tourism and services, media, and recreation.
Ceremonial MOU signing between the DTI and DK PO Fulfillment Company Inc (DKPOFCI)
The MOU between DTI and DK P.O. will provide non-interest-based financing opportunities for MSMEs, providing an avenue for their integration into the Halal industry.
The concept of non-interest financing addresses financial and economic inclusions and supports one of the underlying principles in Islamic financing, such as the absence of “riba” or interest.
The DKPO was founded with the purpose of empowering small and medium-sized enterprises through its Purchase Order (PO) Fulfillment Program, a proprietary system built for sustainable business performance.
It is a comprehensive and integrated growth tool designed by DKPOFCI for expanding businesses with little or no access to capital reserves, insufficient funds to pay for the cost of goods, poor cash flow, or chronic difficulties securing traditional bank funding.
Apart from the marketing and promotional activities, the MOU will provide MSMEs with services and programs for logistics management, quality control and inspection, custom brokerage, insurances, and global sourcing and procurement.
“DK greatly believes that the true growth of the Halal industry will be dependent on a program that will address the development of an end-to-end entrepreneurial ecosystem. The sequence will focus on entrepreneurial education, then pre-seed funding incubation, then acceleration, then market penetration and development, and finally growth funding via transactional venture capital (profit sharing model)” said Mr. Antonio Intal, the company’s Executive Chairman.
Philippine-Malaysia Halal Industry Initiative
Secretary Pascual also added that as part of the robust campaigns of the DTI on Halal development, it also entered into partnerships with various stakeholders and global players in the Halal ecosystem.
These include constant coordination with the Halal powerhouses in the region, namely, Malaysia, Indonesia, and Brunei Darussalam, to learn the best practices of these Halal experts to enhance the credibility and integrity of the Philippine Halal Industry.
Further, capacity and capability building, expert exchanges, and mutual recognition in certification and accreditation are among the cooperation being advanced by the DTI Halal team.
“We are delighted seeing the Philippines flourish in the Halal industry, and we are more than willing, in our capacity, to help and support the efforts of the Philippine government in this sector”, Malaysian Ambassador to the Philippines Dato Abdul Malik Castelino said.
Ambassador Castelino also reported some of the initiatives that the two markets are planning, particularly as the Philippines reinforces its strategies toward the maximization of the full potential of the country’s Halal industry.
He added that the trade and investment relations between the Philippines and Malaysia are even brighter, especially when the Philippines is able to supply the Halal needs of the global Halal consumers.
Launch of Philippine Halal Economy Festival and Invest Philippines Week
The DTI Secretary also underscored that another equally important partner of the Department in promotions is the private sector, which plays a significant role in the global Halal economy.
In particular, Geiser Maclang Marketing Communications Inc.’s Digital Pilipinas has been advocating to mainstream the Halal digital economy.
“We are engaging thought leaders, decision-makers, and industries to create harmonious policies that harness the full potential of innovation while driving robust and more inclusive growth in economic freedom for the Philippines,” said Amor Maclang, the convenor of Digital Pilipinas.
Digital Pilipinas Festival on November 20-24 in SMX Convention Center in Mall of Asia will be part of the DTI’s Invest Philippines Week. Invest Philippines Week brings together government and private sector initiatives in pushing investments in the country.
The agenda will focus on how the Philippines is at the forefront of one of the fastest-growing economies in ASEAN and how our economic growth is driven by the government’s thrust on science, technology, and innovation (STI) initiatives and programs.
In the same week, the DTI, with the Philippine Halal Board member agencies, will host the Halal Economy Festival, with support from the DTI Special Halal Task Force, the Embassy of Malaysia in the Philippines, and Digital Pilipinas.
The festival will feature a trade and investment forum with renowned speakers from the global Halal authorities, mount business-to-business meetings, showcase Halal culinary and culture, and exhibit Halal-certified products and services, including Muslim-friendly hospitality and tourism, among other exciting festivities.
The program will be attended by leaders in the halal economy space, including advocates of innovation and fintech, Islamic banking, and the eCommerce landscape.
Islamic banking and finance are vital components of the global Halal ecosystem. Islamic finance assets are estimated to have grown to USD3.6 trillion in 2021, up 7.8%, from USD3.4 trillion in 2020.
Highlighting the burgeoning Philippine Halal economy, Secretary Pascual stressed, “By maximizing our potential in the Halal industry, we will be instrumental in realizing the vision of President Ferdinand R. Marcos Jr. in gaining more investments, providing greater economic activity, quality employment opportunities, and an enhanced quality of life for all Filipinos. Through our whole-of-government approach, I am very optimistic that we could achieve our overarching objective–fostering a holistic Philippine Halal Ecosystem.”