DEPOK – The Middle East is positioning itself as a major challenger in the global halal food manufacturing sector, despite historically being overshadowed by Southeast Asian leaders like Indonesia and Malaysia. According to the State of the Global Islamic Economy (SGIE) 2024/25 Report, national strategies across the Middle East region have shown successful implementation, positioning the region as a central hub for halal food manufacturing and processing. 

Massive Investment Wave Transforms Regional Food Landscape

The transformation is being driven by substantial financial commitments from both public and private sectors. The rapid expansion of multinational and regional food companies into Saudi Arabia and the UAE signals a strategic shift towards localising halal food production in the Gulf region. 

Recent major investments highlighting this trend include Brazilian firm JBS’s new $50 million facility in Saudi Arabia, UAE-based Al Ghurair Foods’ poultry processing plant, and Nestlé’s inaugural manufacturing plant in Saudi Arabia. These developments represent a coordinated effort to reduce import dependence while building local food security capabilities.

Government and Sovereign Wealth Fund Backing Accelerates Development

The researchers noted that many OIC (Organisation of Islamic Cooperation) sovereign wealth funds and governments are investing substantially in agriculture and food production to enhance food security. Notable projects include Bahrain’s establishment of a new food holding company, Saudi Arabia’s launch of the food-tech entity Topian, Algeria’s $455 million agricultural project, and Kazakhstan’s $600 million poultry farm. This government backed approach provides the financial foundation necessary for rapid development in food and agriculture sectors across the region.

Technology Innovation Drives Competitive Advantage

The Middle East’s competitive edge increasingly relies on advanced food technology solutions. The foodtech ecosystem in this region is maturing, with startups securing multi-million-dollar funding rounds to scale operations, enter new markets, and address food security challenges. 

Revolutionary agricultural technologies are emerging across the region. UAE-based Pure Food Technology developed a solar energy-powered, hydroponic vertical farm requiring 95% less water than traditional farming while delivering 100 times higher crop yield. Similarly, Masdar City partnered with Alesca Technologies to launch automated indoor vertical farms using AI software for fresh produce cultivation.

Saudi Arabia Leads Regional Self-Sufficiency Drive

Saudi Arabia has emerged as the most ambitious player in reducing import dependency. As the top OIC food importer in 2023, spending $27.4 billion on imports, Saudi Arabia has set ambitious targets to localise 85% of the country’s food industry by 2030. The kingdom launched the Jeddah Food Cluster in 2024, described as the world’s largest food cluster with investments of 5.3 billion Saudi riyals ($1.41 billion), expected to contribute 8 billion riyals ($2.13 billion) to national exports.

Growing Market Opportunity Drives Regional Focus

The economic incentive for this regional transformation is substantial. Halal food expenditure grew by 2.6% year on year in 2023 to hit $1.43 trillion, and is expected to grow at a 6.2% CAGR to reach $1.94 trillion by 2028. While Indonesia currently remains the largest market for Muslim consumers’ food spending, followed by Bangladesh and Egypt, the Middle East’s technological advancement and government backing position it to capture increasing market share.

Innovation Beyond Compliance Creates Global Appeal

The region is developing distinctive products that transcend traditional halal compliance requirements. Dubai based Fix Dessert Chocolatier created the Dubai Chocolate bar, initially sold exclusively in Dubai but then gained global attention through social media virality, prompting interest from international markets. Other innovative products include Milaf Cola from Saudi Arabia, the world’s first cola made from dates, and Egypt’s V7 vitamin-enriched, zero-caffeine cola, demonstrating the region’s commitment to creating unique halal food innovations.

Strategic Implications for Global Food Trade

The Middle East’s transformation from import-dependent consumer to halal food manufacturing hub could significantly impact global trade patterns. As regional self-sufficiency increases, traditional food exporters like Brazil, India, and Russia may need to adapt their strategies to maintain market access in this growing economic region.

Original Article:

FoodNavigator‑Asia. (2025, August 26). Middle East rises in global halal food manufacturing race. FoodNavigator‑Asia. https://www.foodnavigator-asia.com/Article/2025/08/25/middle-east-rises-in-global-halal-food-manufacturing-race