Author: Blake Goud
Halal travel is an area within the Islamic economy where many different product sectors overlap to provide the services demanded by Muslim travelers and destinations. Non-Muslim-majority destinations including Singapore and Okinawa are ensuring they provide the facilities and services to attract a growing share of the tourism market. Excluding hajj and umrah, Muslim travel expenditures grew 7.7% in 2013 to $140 billion globally (11.6% of all tourism dollars) and is expected to accelerate, reaching $238 billion by 2019 according to the Thomson Reuters State of the Global Islamic Economy Report 2014-15.
So the dollars and cents are there for destinations to take account of whether they meet expectations for the growing market of Muslim travelers. A survey conducted by Okinawa’s tourism organization found a large proportion of people who didn’t know about the opportunity that halal tourism presented (30%) while 36% said they affirmatively wanted to reach out to attract the Muslim market (96% of these did so because it tapped into a new market). This means that over one-third of tourism-related businesses want to attract halal tourism spending and another third may be open to it but need more information about the opportunity. That is a significant opportunity anda relatively special opportunity also for the economies hosting the tourists.
Why is travel and tourism a special opportunity? It provides an inflow of spending that can boost the local economy and a large share of that spending goes into SMEs including hotels, restaurants, retail shops, local transportation, and tour guides. While there are some global chains that will capture a share of the spending from Muslim tourists, there is an opportunity for SMEs to grab a rising proportion of that share. The survey in Okinawa of prospective tourists found that ‘food’ was a deciding factor, only surpassed by price.
Travelers need to eat and, particularly in destinations with very small Muslim populations, the availability of halal food could be challenging. The global companies that operate in many markets are best able to meet the need, but SMEs can take a bite out of this share if they are aware of what is required to prepare and label halal food. When people travel, they don’t want to eat the same food they get at home but they will unless they can be sure the local alternative will be halal.
That presents an opportunity for chambers of commerce, governments, tourism bodies and other organizations to highlight the unique SMEs in their market to bring tourism dollars to these businesses and deliver the maximum benefit to the local economy. A recent example of how this is done is a halal travel book prepared by the Singapore Tourism Board which specifically focuses on Indonesian tourists. Singapore may have an advantage compared to other countries through its proximity to large Muslim markets (Malaysia and Indonesia) but this type of promotion can help capture the growing travel and tourism-related market to support local SMEs.
The 3rd Annual Islamic Economy Awards are now open to entries across the Islamic economy in Hospitality and Tourism, Food and Health, SME Development, Money and Finance, Media, Waqf and Endowments and the Islamic Economy Knowledge Infrastructure. Nominate your own company or another that you love today! The deadline is July 30.