Brunei: High hopes for halal

Brunei’s halal manufacturing industry is looking at 2011 as its breakthrough year, with the sector aiming to greatly expand both its range of products and the overseas markets its sells to, though there are still some challenges to be met before the full benefits of the groundwork that has been laid can be reaped.

The government has long worked to promote the halal industry, both by supporting private sector activity and by putting in place the infrastructure needed to encourage the development and manufacture of products. Parallel to this, state agencies have been at the forefront of building recognition and acceptance of the Brunei Halal Brand, the Sultanate’s own trademark for products that are certified as sharia compliant.

According to Pehin Yahya Dato Paduka Hj Bakar, Brunei’s Minister of Industry and Primary Resources, the past year has been one of consolidation, learning and experience building. Addressing the opening session of a halal certification workshop on December 14, the minister said that the work done in 2010 will lead to rapid expansion and diversification for all elements of the industry in 2011. According to the minister, by the end of next year dozens of new products will have been certified as meeting the strict standards of the Brunei Halal Brand, and further work will have been carried out to improve systems and processes to ensure that the country’s halal manufacturing sector meets the needs of the growing market. “As we step into 2011, all the experiences and challenges faced this year provide us with a strong platform to develop further. The Brunei Halal products 2011 theme signals a year of development,” Pehin Yahya said.

One of the developments the minister flagged for the new year is the widening of the supply net for raw materials, with overseas sources such as Australasia, Asia and Europe set to be tapped, while these regions are also being eyed as future marketplaces for processed products.

However, it the goals are to be met there must be close cooperation between the private and public sectors. “All sectors must work hand-in-hand to achieve these aims. We must establish a partnership that will allow us to develop a platform to manage the operational procedures and processes necessary to create this exceptional opportunity for growth,” said the minister.

Proof that the private sector is prepared to embrace that opportunity, and the idea of private-public partnership, came in early December at a ceremony to mark the beginning of construction of Brunei’s first halal pharmaceuticals and nutraceuticals products plant. Located in the Lambak Kanan (East) Industrial Estate, the $20m facility is the brainchild of Vivapharm, a joint partnership between Canadian firm Viva Pharmaceutical, Aureos (Brunei) Capital Fund – the private equity fund set up by the government through the Ministry of Finance – and a number of local investors.

Viva president and CEO Jason Ko believes Brunei’s strong halal credentials will serve as an excellent platform that, combined with the his company’s existing expertise, will allow a strong export-oriented industry to develop. Vivapharm would also make use of Brunei’s rich natural resources in research and development work aimed at bringing new products to the market. “From the research and development we will be able to focus on developing new drugs and advanced technologies based on the flora and fauna found in the heart of Borneo,” Ko told local media on December 7.

The Vivapharm plant is due to be fully operational within 18 months, bringing out a range of pharmaceutical products for South-east Asia, as well as helping the parent company increase its foothold in the Middle East, the Asia-Pacific region, Western Europe and the US.

Ainadin Cader, the fund manager for Aureos, feels the joint venture holds great promise, both for the local economy and for advancing the development of halal product development. “Viva’s expertise and Brunei’s strong halal credentials are the ideal combination to set up a state-of-the-art, export-focused, halal-certified manufacturing facility, meeting growing global demand for halal-certified products and bringing new, skilled jobs to Brunei,” he said.

Although it has laid the foundations for a halal-compliant pharmaceuticals sector, and is moving towards strengthening the local production base, Brunei will face stiff competition from other countries in the region and in the Middle East that have recognised the potential of the global halal market. Malaysia is stepping up its efforts to assist halal product manufacturers and is also seeking to have its domestic halal accreditation services accepted in the international market, while Indonesia is working to ramp up its own sharia-compliant products industry.

While Brunei’s halal sector can look to the immediate future with confidence, 2011 will be a year of challenge as well as opportunity, with both the state and private enterprise having little margin for error in the race to build the national brand.