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News
Public Relations Role in Promoting Islamic Product Globally
2014-04-25
Public Relations Role in Promoting Islamic Product Globally:
Malaysian Experiences

Associate Professor Dr Jamilah Ahmad
Universiti Sains Malaysia. Malaysia

Iranian Public Relations News Network(shara) — It is estimated that the market for Shariah compliant products is currently worth over USD$2 trillion worldwide (Andrew White; 2012). White, added that ‘muslim’s consumers present a strong voice that the globalised world of business is paying more attention to, but has yet to fully understand’ how to deal with the market. To understand the global market challenges, it is important for public relations practitioners to apply strategic promotional tools to cater this market. Malaysia, has been venturing into Islamic banking product since 1983. Since then Malaysia has tapped on its Islamic financial system and the halal industry. Malaysia through its Trade Ministry realised that there are tremendous opportunity for growth in global halal market which is valued at US$2.7 trillion annually. In 2012, Malaysia export value for halal products has grown to RM35.4billion (Star, October 2012). The government through its 2013 budget announcement has encouraged the growth of the Islamic capital markets in Malaysia. Among the incentives are tax deduction for Islamic private debt securities and stamp duty waiver on financing facilities under Islamic banking which will certainly boost the industries growth. Simultaneously, the Halal Industry will receive RM200 million budget allocation by 2013. This paper will discuss how public relations play its role in promoting Islamic product globally.

Malaysia is aggressively developing its Islamic product and financial system to becoming an international Islamic hub. The emergence of Islamic banking had eliminated the roles of riba, (usury or interest), maisir (gambling) and gharar (uncertainty) which were implemented by conventional banking system. Some Islamic products such as Islamic bank are similar to those provided by conventional institutions, but others are different (Fouad, 2009). Islamic banks must therefore develop products to achieve the goals of Sharia, and at the same time meet the economic needs of society (Fouad 2009). It is noted that there is a widespread use of securitization (tawreeq), “fictitious” Morabaha deals, and certain “fabricated” Sukuk, provided by some financial institutions as Islamic banking products and services.

The definition of Islamic bank, as approved by the General Secretariat of the OIC, is stated in the following manner. "An Islamic bank is a financial institution whose status, rules and procedures expressly state its commitment to the principle of Islamic Shariah and to the banning of the receipt and payment of interest on any of its operations. At present, there are more than 300 Islamic Banks and other financial institutions managing funds to the tune of $300 billion, with deposits exceeding $ 120 billion and operating in 48 countries (Noor, 2007)

According to Abdul Majeed (2012), the rules and practices of Islamic banking came from the Quran and the Sunnah, and other secondary sources of Islamic law such as opinions collectively agreed among Shariah scholars (ijma’), analogy (qiyas) and personal reasoning (ijtihad).

The Holy Quran says that commerce and trade include the following three principles (i) Risk Taking (ghorm); (ii) Work and Effort (kasb) and (iii) Responsibility (Damam). Islamic law prohibits investing in businesses that are considered unlawful (haram) such as businesses that sell alcohol or pork; or businesses that produce media (such as gossip columns or pornography); or gambling industry etc. The products offered by the Islamic Banks are so tailor made that fulfil the above there principles of Islamic Law.

Apart of Islamic banking, halal product also another type of Islamic product. Essentially, the word Halal originated from an Arabic word that means “permissible” or “ lawful” under Islamic Law (Syara’). Kambiz & Mohammad Reza (2011) stated that the realm of halal might extend to all consumables such as toiletries, pharmaceuticals, cosmetics and services including finance. Nestle has become the largest food manufacturer in the Halal sector, with more than $3 billion in annual sales in Islamic country (Kearney, 2006).