• Commends IsDB’s non-interest financing
Sunday Okobi in Baku, Azerbaijan
As part of its economic policies and reforms, the President Bola Tinubu administration is now focusing strategically on developing the Halal ecosystem to boost the economy, the Deputy Chief of Staff to the President (Office of the Vice President), Senator Ibrahim Hassan Hadejia, has said.
Hadejia exclusively told THISDAY yesterday at the sidelines of the Islamic Development Bank (IsDB) Group Annual Meeting taking place in Baku, Azerbaijan, that barely a year ago, the Tinubu administration inaugurated a process of developing and creating a Halal ecosystem for Nigeria to key into the fastest-growing sector of the global economy.
The Halal economy (also referred to as the Islamic economy) is a global economic sector structured around products and services that comply with Islamic law (Sharia).
While traditionally associated with dietary laws, specifically meat prepared according to Islamic laws, the modern Halal economy has expanded far beyond food and now represents a lifestyle-driven market rooted in ethical, health, and safety standards that appeal not only to the world’s Muslim population but also to non-Muslim consumers looking for organic, ethical, or cruelty-free options.
According to the presidential aide, “After, of course, the advent of the private sector doing it alone, the government has to come in because Nigeria, without any effort, is the seventh largest Halal consumer country on earth and the second largest in Africa.
“So, with the government now coming in to develop the ecosystem, helping with certification and infrastructure, we want to tap into the fastest-growing sector of the global economy.”
He noted that it used to be a niche, in which it was perceived as a religious thing, “but now, it has exploded in economic growth, and it’s heading toward seven trillion dollars, and it has nothing to do with religion.
Among the ten largest Halal economies in the world, I believe it’s only one, Turkey, which is number nine, that would be said to have some religious affiliation to the Halal ecosystem.
The rest are all, you know, including Australia, New Zealand, Brazil, the United States, and others.
“It’s simply economy, and we believe that Nigeria needs to move in and tap into that very fast-growing sector because we have the numerical advantage.
“I mean, if you imagine that even our local economy is a market in itself, let alone now shifting towards exporting livestock and derivatives, with the fact that we have the largest livestock population on the African continent.”
Hadejia posited further that: “We now have a dedicated ministry (Ministry of Livestock), and of course, just like with everything else, Nigerian livestock is particularly demanded by the Middle East and Arabian countries because of the unique flavour of our goat meat. So, it is something that they are doing currently informally, and we want to ensure that we capture it and integrate it into a larger economic policy.”
On how the halal ecosystem would impact the common man, he said the focus is on creating micro, small, and medium enterprises (MSMEs), adding: We’re talking of MSMEs. We’re not talking about mega industries out of the reach of the common man; it is for MSMEs.
“So, obviously, by the time we establish that economic framework, it will be a part of the economic inclusion initiative of the government. This is an ecosystem from the ground up. We’re not starting in the middle; we’re not starting at the top. We’re moving directly to the production sector.”
He noted that the government has brought reforms to the foreign exchange, oil sector, and infrastructure development, “which, you know, we are very focused and dedicated to taking to the end.
“By the time you consider them, even the road infrastructure that is ongoing across the country, in the next two, three years, that’s going to have a significant impact on the economy.
“We also look at the fact that Nigeria’s inflation is essentially driven by food inflation. Food inflation is driven by logistics. If you resolve those issues, you know, the differential between foodstuff in Kano and Lagos would probably be 15 to 20 percent instead of 3,000 percent that we have now because of logistics issues.”
Hadejia lauded IsDB’s contributions to the Nigerian economy by simplifying lending.
According to him, “Talking about the Islamic Development Bank impact on our economy, if you look at the basket of the lenders we have in Nigeria, when you talk to anybody in the Ministry of Finance, you would know that ISDB financing is probably the cheapest, the least technical, and the most uncomplicated.
“It’s very straightforward looking at it from the perspective of risk sharing because of the non-interest financing. So, in fact, the people are actually looking more to ISDB for refinancing now, to take them out of the IMF, World Bank, and others.
“Because of the lower cost and the shared risk, nobody is dumping the risk 100 percent on the lender. So, I commend the IsDB impact immensely, and I guess that that is what is also giving rise to non-interest banking in Nigeria, commanding almost 18 percent of the total banking sector.”
