Market Growth Alongside Underlying Drivers

In 2023, Muslim spending on beauty plus personal care reached approximately US$87 billion, reflecting a 2.9% rise from 2022. Projections indicate growth towards US$118 billion by 2028, with a compound annual growth rate (CAGR) of 6.3%. India continues to lead spending among Muslim-majority markets, while Turkey alongside Indonesia have recently climbed to second and third spots, respectively.

The surge in halal beauty stems from more than just halal certification alone. Consumers now weigh certification against price, product performance, sustainability efforts, plus digital accessibility. While halal credentials open doors, the true value proposition coupled with reliability remain vital for success.

Import Trends Alongside Global Supply Dynamics

In 2023, cosmetics imports into OIC (Organization of Islamic Cooperation) countries hit US$20.62 billion, showing an 11.3% year-over-year increase. Forecasts estimate this figure rising to US$32.47 billion by 2028, representing a CAGR near 9.5%. Leading importers include the UAE with US$4.62 billion, Saudi Arabia at US$2.52 billion, plus Turkey accounting for US$2.01 billion.

France stood as the top exporter to OIC markets during 2023 with US$3.88 billion, followed by the UAE with US$1.70 billion and the U.S. trailing with US$1.32 billion. Additionally, the UAE acts as a key re-export hub within the region, amplifying its trade role.

East Asia’s Growing Impact

Chinese alongside Korean brands continue to deepen their presence within the halal beauty sector. Chinese brands, recognized for competitive pricing, rapid innovation cycles, along with strong social commerce strategies, have resonated deeply with Gen Z consumers across Southeast Asia as well as the Gulf. For example, SHEGLAM has expanded its footprint to approximately 140 stores spanning the GCC.

From a manufacturing perspective, companies are scaling operations across China to better meet surging global halal beauty demand. Cosmax recently opened a plant capable of boosting production from 5 million to 30 million units monthly. Meanwhile, L’Oréal has diversified logistics infrastructure within China, enhancing supply chain resilience.

Korean participants receive growing support too: South Korea’s regulatory body, MFDS, is expanding halal cosmetics certification training programs. Meanwhile, a new Korea–GCC free trade agreement has reduced tariffs on numerous products, smoothing K-beauty’s pathway into Muslim-majority markets.

GCC Investments Alongside Regional Retail Expansion

Countries in the Gulf region are making significant investments in beauty plus fragrance sectors. Notable highlights include:

• Al Majed for Oud’s IPO raised US$188 million, oversubscribed by investors

• Nice One’s public listing at US$320 million led to a 30% valuation jump

• Jadwa Investment acquired 35% stake in Kuwait’s Gissah Perfumes, gearing it for a Saudi stock market debut

• The GCC’s Halal Product Development Company, backed by the Public Investment Fund, invested in Believe, a Singapore-based halal beauty brand aiming to localize production

On the retail side, Watsons reported a 53% sales increase across GCC markets, with plans to enter Bahrain and Kuwait soon. Flormar targets tripling its store network within Saudi Arabia. Beautyworld Middle East, a major trade show, recorded unprecedented attendance, signaling an increasingly mature industry ecosystem.

Sustainability Alongside Regulatory Pressures

Sustainability is evolving beyond conversation into tangible actions. In Indonesia, ERHA installed a reverse vending machine dedicated to cosmetics packaging waste reduction. L’Oréal introduced a EUR 50 million (USD 58.6 million) supplier fund designed to assist smaller partners in upgrading sustainability practices. Globally, retailers like Kiehl’s, Sephora plus Ulta are launching initiatives aimed at cutting plastic consumption.

On the regulatory front, multiple nations are tightening policy frameworks:

• Indonesia has drafted stricter labelling requirements for refillable cosmetics

• Thailand’s FDA is rolling out rules governing cosmetics refill stations

• The EU updated its CLP (Classification, Labelling and Packaging) regulations, enhancing transparency through digital labelling to foster greener plus more traceable products

Crackdown on Counterfeits Alongside Traceability Enhancements

Authorities across various markets are intensifying enforcement against counterfeit cosmetics, protecting consumer safety and preserving trust in halal claims. Examples include:

• The UAE seized counterfeit cosmetics valued around AED 23 million (USD 6.26 million)

• Saudi Arabia’s FDA confiscated roughly 365,000 unregistered cosmetics and food items linked to unlicensed online sellers, with penalties under Cosmetics Law reaching SAR 5 million or five years imprisonment

• Indonesia’s BPOM uncovered 51,000 illegal cosmetic products in beauty clinics while blocking over 100,000 online listings since 2023

Halal cosmetics brands are increasingly linking certification data to packaging, retail systems, plus supply chain records, enabling consumers and regulators to swiftly verify product claims.

Shifting Consumer Preferences Alongside Demand

Geopolitical tensions combined with consumer boycotts are reshaping brand loyalty. In Indonesia, boycotts targeted multinational brands such as L’Oréal and The Body Shop, prompting shoppers to shift towards Chinese plus local beauty labels. Simultaneously, demand is rising for inclusive, gender-neutral beauty products; searches for “unisex perfume” in the MENA region surged by over 50%.

Brands blending halal positioning with inclusive formulas—like unisex skincare or fragrance ranges—stand to streamline offerings while broadening consumer appeal.

AI Integration Alongside Personalization Trends

Artificial intelligence (AI) sees growing application across product development along with retail experiences:

• Cosmax employs deep-learning color-matching to predict shades without repeated lab trials

• Unilever reported consumer-facing AI tools boosting purchase completion rates by about 43% for select beauty brands

• In Southeast Asia, Wardah introduced “Colourverse,” an AI-driven personal color analysis tool assisting shoppers in shade selection

• In fragrance, Flowwow launched an AI UAE Scents line celebrating National Day, while Osmo, a startup, unveiled an AI scent sensor aimed at product authentication, offering a potential anti-counterfeit measure

Outlook to 2028 Alongside Strategic Priorities

The report outlines that leaders within the halal beauty sector will distinguish themselves across three key areas:

• Speedy certification and verification processes

• Sustainable growth through smart packaging combined with refill models

• Engaging consumers via competitive pricing, digital platforms, plus inclusive branding

Challenges persist within Muslim-minority markets. For example, Japan’s smaller, less established Muslim communities leave the halal beauty ecosystem nascent. One entrepreneur noted that most startup events fail to target halal product development needs.

Given increasing investments plus supportive policies across the GCC and Southeast Asia, forecasts predict growth in joint ventures, localized manufacturing, alongside closer trade links with East Asia. The main opportunity for suppliers lies in becoming trusted partners—compliant, responsive, built for transparency and traceability.

Original Article:

Tay, C. M. (2025, October 6). Halal beauty to reach $118bn by 2028 amid GCC funding and anti-fake push. CosmeticsDesign-Asia. Retrieved from https://www.cosmeticsdesign-asia.com/Article/2025/10/06/halal-beauty-to-reach-118bn-by-2028-amid-gcc-funding-and-anti-fake-push/