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Halal Industry
UAE commits $50m to development initiative 

The UAE has committed $50 million to the second phase of the Lives and Livelihoods Fund 2.0 (LLF 2.0), a multi-donor development initiative supporting sustainable socio-economic development in Islamic Development Bank’s (IsDB) 57 member countries.

The funding will be used by LLF 2.0 to support critical projects in health and infectious diseases, agriculture, and social infrastructure in low and lower-middle income IsDB member countries. 

The funding also aims to support 32 member countries in achieving 10 of the 17 sustainable development goals.

The new financing will be administered by the Abu Dhabi Fund for Development, in addition to $50 million the UAE has contributed to the LLF since its launch in 2016.

“Through LLF 2.0, we will focus on climate-smart agriculture, primary care, underfunded social services, and infrastructure investment,” Mohamed Saif Al Suwaidi, director general for Abu Dhabi Fund for Development said. 

“LLF 2.0 will also optimize its anti-poverty focus, setting grant portions to enhance stability and transparency.”

The Fund in its first phase invested over $1.4 billion across 22 IsDB member countries, enabling more than three million smallholder farmers to improve their livelihoods, and providing 12.5 million women and children access to quality healthcare.

It is also expected to provide over 7.5 million people with better water and sanitation facilities.

LLF is a joint initiative of the Islamic Development Bank, the Abu Dhabi Fund for Development, the Bill & Melinda Gates Foundation, the Islamic Solidarity Fund for Development, the King Salman Relief Humanitarian Aid and Relief Centre, and the Qatar Fund for Development.
 

Halal Industry
Halal industry wrap: Two US halal bodies receive Indonesia’s accreditation

Here's a roundup of key developments across the halal industry ecosystem during the first two weeks of April

Editor's note: Months ahead of Indonesia's mandate of halal products labelling, the country has accredited two more US halal bodies. Indonesia's halal product assurance agency has also partnered with Singapore's Shopee to enable halal certification services. 

And, the Malaysia International Halal Showcase is coming to Dubai later this year. 

 

Company News


Indonesia / Singapore

Shopee offers halal certification service 

Shopee, a Singapore-based e-commerce platform, partnered with Indonesia’s Halal Product Assurance Organizing Agency (BPJPH) to offer halal certification services to micro, small, and medium enterprises (MSMEs) via its Shopee Barokah feature.

 

This collaboration, according to Handika Jahja, executive director of Shopee Indonesia, seeks to promote the halal industry through e-commerce and support the implementation of the government's halal certification policy. (Tempo)

 

United Kingdom

Halal pet food company to launch in the UK

Aihtsham Rashid, an entrepreneur from Leeds, Yorkshire, is set to introduce Hurayra Halal Pet Food to the UK market. Rashid aims to address the scarcity of natural, high-protein, GMO- and preservative-free options in the UK pet food market.

 

This initiative comes after Rashid's own struggle to find high-quality halal cat food for his pets, reflecting the demand among Muslim pet owners for halal options aligning with their dietary practices and religious beliefs. (Halal Focus)

 

US

New app helps Muslims find halal restaurants

A new app, Zabihah, is simplifying the task of finding halal restaurants for Muslims in Western countries. Halal restaurants serve food that adheres to religious dietary laws followed by many Muslims.

 

With this app, Muslims can easily locate such establishments, easing the challenge of finding halal options in Western locations. (VOA News)

 

 

Regulatory


Indonesia / US

Two US halal bodies get Indonesia’s accreditation

Two American halal certification bodies have been accredited in Indonesia before the country mandates halal labeling for all food, beverages, and meat entering its market starting October 17.

 

The two bodies are the American Halal Foundation (AHF) and the US Halal Chamber of Commerce’s Islamic Society of the Washington Area (ISWA) Halal Certification Department. (Jakarta Globe)

 

 

Investment


Philippines

DTI, Halal Expo Canada collaboration targets investments

The Halal Expo Philippines, a collaborative effort between the Department of Trade and Industry (DTI) and Canada, aims to generate investments worth up to 230 billion Philippine pesos. 

 

Scheduled for November 2024, the expo anticipates creating over 120,000 jobs for Filipinos within the next four years, tapping into the $7 trillion global halal industry. (GMA Network)

 

 

Trade Developments


Malaysia / UAE

Malaysia to organise halal showcase in Dubai

The Malaysia External Trade Development Corporation (Matrade) is expanding the reach of the Malaysia International Halal Showcase (Mihas) by hosting its first international edition in Dubai this year.

 

Themed 'Globalising halal innovations', the event will take place in two parts: first at the Malaysia International Trade and Exhibition Centre from Sept 17 to 20, then at the Dubai World Trade Centre from Nov 18 to 20. (The Star)

 


UPCOMING EVENTS :

Halal Industry
Ramadan charitable efforts underscore huge Muslim philanthropy potential

Philanthropy and the notion of helping the less fortunate is ingrained in a Muslim’s DNA owed to its momentous importance in Islam. 

These altruistic initiatives and efforts significantly increase during Ramadan as Muslims see charitable acts as a way of amplifying the spiritual benefits of fasting and worship in the holy month. As a result, Ramadan is often the busiest time of the year for charitable foundations.

Individuals are more cognisant and willing to pursue charitable efforts during the holy month. This is prevalent especially across Muslim majority countries. 

YallaGive, a UK-headquartered online donation and crowdfunding platform that is registered in several Muslim countries including Turkey, Malaysia, and the UAE, has consistently witnessed an uptick in activity during Ramadan.

“On average, we observe a significant increase ranging from 30% to 50% in charitable donations and campaigns during Ramadan compared to other months of the year. This surge underscores the generosity and spirit of giving that permeates communities during this sacred time,” Nabil Boubker, director of strategy and business development at YallaGive told Salaam Gateway.

“Fasting during Ramadan fosters empathy and a deeper understanding of the struggles faced by those less fortunate. This heightened sense of compassion often translates into increased generosity towards charitable causes, as individuals strive to alleviate the suffering of others and contribute to their well-being,” said Boubker.

UAE-based Gulf for Good is one of the non-profit organizations that used YallaGive for its 2024 Ramadan campaign.

The NGO, which focuses on raising money to support underprivileged children around the world, launched the ‘Gift of Giving’ social media campaign in support of The Citizens Foundation that aims to empower 180 Pakistani students in a rural village in Nowshera, a city in the country's Khyber Pakhtunkhwa province.  

“We have a long-standing relationship with YallaGive and use them as our official fundraising platform. With their help, we’re able to welcome all contributors, local and international, allowing us to reach a broader audience and garner support from around the world,” Kat Kearsey, chairwoman of Gulf for Good in the UAE told Salaam Gateway.

She said that Gulf for Good increases its fundraising activities substantially during Ramadan to capitalize on the spirit of giving that defines the holy month. 

“We generally see a significant increase in donations during Ramadan, reflecting the increased spirit of compassion and philanthropy during this period. This uptick in donations is consistent with the generosity we witness from our community during Ramadan compared to other times of the year,” said Kearsey.

Global imprint

The impact of Ramadan on donating behaviors is profound in non-Muslim majority countries, too, with Islamic charity foundations raising the lion’s share of their annual funds during the holy month.

According to the Muslim Philanthropy Initiative (MPI), Muslim Americans gave an estimated $1.8 billion in Zakat donations in 2022, with most of these funds given during Ramadan to support causes such as hunger and poverty alleviation, and immediate relief.

Similarly, the National Zakat Foundation (NZF) Canada collects more than 75% of its total Zakat revenues and 50% of other forms of charity during the month of Ramadan. Over the past two years, donations amounting to nearly 9 million Canadian dollars have enabled NZF to assist around 25,000 people across four provinces in Canada with food, housing, and essentials.

Given the charitable significance of this period, the charity begins its Ramadan activities three months prior to the holy month.

“The majority of our efforts are based in the month of Ramadan and the few months leading up to it. We spend between 60-70% of our annual marketing budget during this time on both online and offline marketing activities,” said Zubair Qasim, CEO of NZF Canada.

Meanwhile, Muslims are estimated to pitch in more than a 1 billion British pounds annually to causes in the UK and abroad each year. Muslim international giving is estimated to cross 4 billion British pounds by the year 2051. 

Furthermore, Muslims are just as likely to give to causes outside their faith as those within – and of all faiths, are the most likely to give to poverty causes outside their religion, according to Shariq Siddiqui, assistant professor and director of the Muslim Philanthropy Initiative.

“For organizations that are not considered Muslim-led, if they don’t do outreach to Muslims during Ramadan, they are less likely to raise money effectively from a small but generous population.”

Given their charitable endeavours, the influence of Muslims on philanthropic activities cannot be understated. 

Halal Industry
McDonald’s to buy Israeli franchise amid deepening Gaza crisis

McDonald’s Corporation has agreed to purchase its 30-year-old Israeli franchise as the Gaza crisis deepens further. 

McDonald’s will take ownership of 225 restaurants that employ more than 5,000 employees from Alonyal Limited, the owner and operator of the franchise in Israel. 

“For more than 30 years, Alonyal Limited has been proud to bring the Golden Arches to Israel and serve our communities,” said Omri Padan, CEO and owner of Alonyal Limited.

McDonald’s said that upon completion of the transaction, it will own Alonyal Limited’s restaurants and operations, while the employees will be retained on equivalent terms.

Contingent on certain terms, the deal is expected to close out in the coming months.

The transaction value has not been disclosed. 

Jo Sempels, president of international developmental licensed markets at McDonald’s said that the company remains committed to the Israeli market.

McDonald’s operates 40,000 locations in more than 100 countries, with roughly 95% of its restaurants globally owned and operated by independent local business owners.

The global chain has experienced consumer outrage and faltering sales across the Middle East since its Israeli franchise announced free meals for Israeli soldiers in the wake of the Gaza conflict. 

The company’s CEO and president Chris Kempczinski said in January that several Middle Eastern markets and some outside the region were experiencing a “meaningful business impact” due to the war and associated misinformation. 

Sales growth for the company's international developmental licensed markets - covering more than 75 countries including the Middle East, India, Malaysia, Indonesia, and China - stood at 0.7 per cent for the fourth quarter of 2023. 

Halal Industry
Gaza crisis renews calls to spurn Israeli dates

Muslims across the world traditionally break their fasts with dates during Ramadan, making it a staple food item across households in the holy month.

This has historically prompted an uprise in the sales of dates and date products across Muslim-majority countries every year, ahead of the holy month.

In this context, this year is no different. 

However, in the wake of the Gaza conflict, the current year has proven to be atypical as it has carried calls to conduct a cautious screening ahead of purchasing dates, primarily to gauge their origin. 

In short, a concerted attempt to spurn Israeli dates.  

The Gaza crisis – now ending its sixth month, has set a product disengagement campaign in motion, whereas Muslims around the world have shunned products and brands, companies even, believed to be supporting the Israeli offensive.

The campaign has had tangible effects, with several Western companies and brands reporting diminishing sales figures and forecasts, debilitating customer engagement and job losses.

It is no surprise that the global movement drew in dates ahead of the holy month.  

Calls to avoid the purchase of Israeli dates has come from multiple quarters and levels.

Indonesia’s religious body appealed to Muslims across the country to refrain from purchasing dates produced in Israel, citing them ‘haram’ or impermissible. 

Miftahul Huda, secretary of the MUI Fatwa Commission told Salaam Gateway that one form of resistance is to reject Israeli products and products that support Israeli aggression against Palestine.

Meanwhile, Malaysia’s ministry of domestic trade and cost of living announced in March that it would continue to monitor the sales of dates suspected to originate from Israel, while the country’s customs department seized 73 packets of dates believed to be Israeli. 

Norhariti Jalil, partner at DinarStandard, said that import of dates into Malaysia can come from many GCC sources, too. 

While Israel itself may not be a top dates producer, it is one of its top exporters, with $330 million in export value, second only to Saudi Arabia. It is world’s leading supplier of the Medjool dates, with the Israel Date Growers' Cooperative – Hadiklaim – exporting 20,000 tons of dates and date products annually. 

Israel exported fresh or dried dates worth $6.35 billion to the US during the first five months of the year 2023-24, accounting for around 21% of $29.37 billion imported by the US, according to Economic Research Service data provided by the US Department of Agriculture. Mexico led the pack with exports worth $10.1 billion. 

Meanwhile, the UK is the second-biggest importer of Israeli dates in Europe, having imported more than 3,000 tonnes – worth around 7.5 million pounds – in 2020, non-profit organization Friends of Al Aqsa said.

It launched a campaign to spurn Israeli dates, urging consumers to avoid purchasing those labelled from Israel, the West Bank, and the Jordan Valley, or if the country of origin on the label is absent. 

“There are two peaks of date consumption in Europe. One is during the month of Ramadan and the other is during New Year’s Eve and Christmas,” the advocacy group said. 

Synchronous goals
There are simultaneous calls to encourage dates and other products grown and traded by Palestinian producers. 

Date palm production, despite Israel-imposed restrictions, has increased in recent years, and is a key mean of supporting livelihood for Palestinian farmers. 

According to a FAO (Food and Agriculture Organization of the United Nations) report published last year, dates have been cultivated in Palestine for thousands of years but face severe problems with the Israeli occupation and their control of water resources. 

“Date palm production showed some expansion during the last 15 years, and more recently in the West Bank and Gaza Strip. Production in 2015 reached 5,000mt. Date farming is practiced by about 1,430 date palm producers (60 are women) in Deir Al Balah and Khan Younis, the main date areas in Gaza Strip,” the Value chain study - Date palm in the Arab region report added.  

There are several companies supporting the Palestine cause outside of Palestine. UK-based Zaytoun sells a range of products sourced from multiple communities in Palestine, available across shops and retailers in the country.

"We offer premium quality products that are ethically sourced, sustainably grown and sourced from farmers in Palestine. In doing so, we support Palestinian farming communities facing the challenges of illegal Israeli occupation and settlement through trade," the company said, on its website.  

Additional reporting from Yosi Winosa in Jakarta, Indonesia

Halal Industry
Halal industry wrap: Peru aims to become halal food exporter

Here's a roundup of key developments across the halal industry ecosystem during the first three weeks of March

Editor's note: Good news for South American Muslims - Peru, home to epic landmarks, is now keen to become a halal food exporter. As is Vietnam, as it looks set to launch the export of halal meat to Muslim-majority markets. 

Meanwhile, delivery app Zouq is looking to capture the Philippines market handsomely, by delivering halal food to Muslim Filipinos. 

 

Trade Development


Peru / Malaysia

Peru to leverage Malaysian halal certification for food exports

Peru targets becoming a halal food exporter following its halal certification from Malaysia.

 

Vice foreign trade minister Teresa Stella Mera Gomez reveals ongoing discussions with Malaysian authorities to leverage their expertise.

 

A memorandum of understanding is anticipated in the coming months to enhance Peru's agricultural industry amid efforts to reduce reliance on mining. (The Sun)

 

Bangladesh

D-8 CCI seeks more stake in global halal market

The D-8 Chambers of Commerce and Industry (D-8 CCI) unveils a five-year strategic plan to boost its presence in the global halal economy by 2029.

 

The members of the D-8 CCI are national chambers of commerce and industries of eight countries of D-8. These include Bangladesh, Egypt, Indonesia, Iran, Malaysia, Nigeria, Pakistan and Turkey. 

 

The D-8 CCI president highlighted the importance of standardization and the potential for countries like Bangladesh to contribute.

 

The roadmap was discussed during the organization's third general assembly, with Turkey and Malaysia currently leading in halal economy contributions among D-8 nations. (The Business Standard)

 

Vietnam

Vietnam set to export halal meat to Muslim-majority nations

Vietnam is set to launch the export of chicken meat products to Muslim-majority markets, targeting around 1,000 tonnes per month.

 

The country's deputy minister of agriculture and rural development Phùng Duc Tien announced plans for a conference in May for the same. 

 

With a population of approximately 2.2 billion people, Muslim countries present significant opportunities for Vietnamese agricultural products. (Halal Focus)

 

 

Company News


Philippines

Delivery app delivers halal food to Muslim consumers

Zouq, a halal food delivery app, is revolutionizing the halal dining experience for Muslim Filipinos and health-conscious consumers.

 

Unveiled by the NCMF-NCR in Quezon City, Zouq is set to bridge the gap between consumers and halal cuisine. (PIA GOV)

 

Regulatory


Indonesia

Development board discusses halal product certification
The Business Startups and Incubation Development Board (BPBRIN) organized a workshop on the importance of halal product certification this month. 

 

The workshop aimed to educate stakeholders in startup businesses about mandatory halal certification to be implemented in October 2024, as per Law No. 2 of 2022. (UNAIR)

 

Saudi Arabia

Saudi authority leads delegation on food safety
Hisham Saad Aljadhey, CEO of the Saudi Food and Drug Authority (SFDA), led the Saudi delegation at the GCC's eighth annual ministerial meeting on food safety in Doha, Qatar.

 

The meeting focused on the achievements of GCC cooperation in food safety, including the approval and adoption of unified regulations and laws, such as the Rapid Alarm System for Food and Feed (GCC-RASFF). (Saudi Press Agency)

 

 


UPCOMING EVENTS :

Halal Industry
Halal companies shine at Gulfood as they gear up to expand in Muslim markets

From non-alcoholic ale to halal Scotch lamb, the broad range of halal food and beverage products showcased at this year’s Gulfood reflects the growing importance of Muslim markets for global firms.

The latest edition of Gulfood concluded two weeks ago but the energy is still high as halal food producers capitalize on the interest generated at the Dubai trade show.

Some of the biggest names in the industry were present, including Saudi Arabian poultry producer Tanmiah, Brazilian food processor BRF, and UAE-based food and beverage heavyweight Agthia Group. 

Many smaller players were also present, such as Australia’s Green Grass Exports, which showcased the country’s halal goat meat, and Spanish family-run Costa Brava Mediterranean Foods, which participated with its halal lamb and beef meat products.

Innovative beverages

Gulfood 2024 was the largest in the trade show’s history, having grown from 65 exhibitors in its inaugural event in 1987 to more than 5,500 in its 29th edition.

The latest edition saw the introduction of innovative halal beverages. Dubai-based Midtown Factory, for example, launched its non-alcoholic craft Arabian ale Majlis, made and brewed in the UAE.

“We showcased exquisite products from the Majlis range - Majlis Original, Majlis Gluten-Free and Majlis Stout. Visitors to the exhibition were among the first to taste these new additions alongside our original ale,” the company said in a social media post.

The response was “phenomenal”, it added, with industry representatives from the Gulf region, Europe, and Canada expressing interest in collaborations. 

“We're discussing various partnership formats, including exporting our finished product and potentially setting up manufacturing facilities in partner countries.”

Belgium-based malt beverage manufacturer Martens Brewery also promoted its Belgian non-alcoholic and halal malt beverages in different flavours to Muslim consumers.

UK focus on halal lamb products

A highlight of this year’s Gulfood was the addition of halal Scotch lamb.

The product was introduced by Quality Meat Scotland (QMS), a government body that promotes Scottish red meat, and Woodhead Brothers. The latter became the first Scottish lamb processor to receive accreditation to supply to the Middle East market in December 2023, according to QMS. 

“Having sampled our products in early November, buyers in Dubai were delighted with the quality and flavour our range had to offer. As of today, we will mainly be supplying products into high-end food service, the leisure and tourist markets, and look forward to growing trade with other nations,” Scott Bradley, trading manager at Woodhead Brothers, said in November.

With the sheep meat production levels of the six Gulf Cooperation Countries (GCC) fulfilling only 66% of their consumption, QMS estimates the new market could have significant worth to the Scottish sheep industry. 

The UK Pavilion also featured grass-fed halal-certified lamb products from British food processer ABP UK. “We met a lot of new buyers from across the region and beyond and renewed our relationship with existing ones,” said Adil Khan, the company’s commercial consultant and founder of UAE-based trade specialist Crown Houze Events. 

Strong participation from Latin America

Meanwhile, Brazil, the world's largest exporter of halal meat, accounting for almost 28% of global halal exports, sent its biggest-ever delegation to Gulfood 2024.

As many as 117 companies across six pavilions, including three dedicated to animal protein, took part.

With the UAE ranked the 13th largest buyer of Brazilian agribusiness products, there was a waiting list of companies wanting to participate in this year’s Gulfood, according to the Brazilian Trade and Investment Promotion Agency (ApexBrasil), which is responsible for the delegation at Gulfood.

“Gulfood is a strategic event for the Brazilian poultry industry. Brazil is the world’s largest exporter of chicken meat, and nearly half of its shipments are halal products, making our sector the largest exporter of poultry products to Islamic nations,” Ricardo Santin, president of the Brazilian Association of Animal Protein, told Arab News.

By the end of the trade show, Brazilian companies had closed business deals worth an estimated $4.5 billion, according to Apex-Brasil, surpassing the agency’s projections of $3 billion.

Furthermore, Abu Dhabi Food Hub - a trading and logistics hub - and the Arab Brazilian Chamber of Commerce signed a memorandum of understanding during Gulfood to strengthen food trade from Brazil to the UAE and the region.

Under the agreement, which is part of the Halal do Brasil initiative, Abu Dhabi Food hub will be enabling Brazilian businesses to tap into the region’s booming halal market. 

Argentinian halal-certified beef also took centre stage at Gulfood, with the Argentine Beef Promotion Institute (IPCVA) bringing together 13 meat-exporting companies at its pavilion. 

The exhibitors saw interest from buyers from many Arab countries, including Saudi Arabia, Egypt, Qatar, Lebanon, Iraq, Libya, and UAE. As such, IPCVA expects to see exports with halal certification grow in the coming months. 

Mariano Durán, foreign trade executive at Compañía Bernal, one of Argentina’s largest beef processing companies and an exhibitor at Gulfood, noted that in 2022, Muslim consumer expenditure on food represented 12% of global food expenditure. 

Given the size of the halal food market, most of Argentina’s meat-exporting companies attended the trade show in Dubai, with their sights set on expanding to markets such as the Middle East and Asia, as well as the Muslim market that is not geographically limited to these regions.
 
Halal certifiers play crucial role

With more companies seeking halal certification to access Muslim markets, Brazil’s two biggest halal certifiers, the Federation of Muslim Associations in Brazil (FAMBRAS) and CDIAL Halal, ensured their presence at Gulfood.

The certifiers focused on expanding halal business opportunities for companies to help place more of their products on international shelves, especially in Muslim markets.

During the trade show, FAMBRAS’ certifying team met with executives from the Brazilian beef exporters association (ABIEC), which is responsible for 98% of the country's beef traded in international markets, and the national association of poultry production and exports in Brazil (ABPA), among others.

Meanwhile, CDIAL Halal helped facilitate meetings between companies such as Brazilian egg specialists Netto Alimentos, and high-level representatives from various organizations, including the Ministry of Investment of Saudi Arabia and the kingdom’s Halal Products Development Company.

Asian countries highlight their halal potential

The Philippines and Taiwan - two non-Muslim majority countries - both put the spotlight on their halal offerings at Gulfood. 

For example, Taiwan Pavilion’s 15 exhibitors promoted foods and beverages that were all halal certified. Some of them had done business in the region for years, while others, such as Mayushan Foods Co., a producer of rice bran and roasted wheat flour, were looking to break into the Middle East market.

The pavilion was set up by the Taiwan External Trade Development Council (TAITRA) and the Kaohsiung City Farmers' Association, with Wu Yo-ting, a specialist with Dakwah Halal Foundation Taiwan, heading TAITRA’s delegation. 

Dakwah, established by Taiwan’s government in 2017 and entrusted to TAITRA, reflects the East Asian country’s strategic approach to serving the halal market. The foundation aims to assist Taiwanese manufacturers in producing halal-certified foods that can be marketed to the vast Muslim communities.

The Philippines, on the other hand, continued to solidify its position in the competitive halal marketplace, with 25 companies showcasing their halal-certified food products at the trade show.

Miguel Kyan Aman, CEO of Miguilitos Ice Cream, which was among the exhibitors, told the Filipino Times that they were pushing to become the number one soft-serve ice-cream in the Philippines. “It’s halal and vegan, with plans to expand into the Middle East.”

Despite a predominantly Catholic population, the Philippines aims to expand its domestic halal industry.

In January 2024, the country’s Department of Trade and Industry (DTI) introduced a four-year plan for the development of the halal industry with a goal to attract 230 billion pesos in investments and create 120,000 jobs by 2028.

This comes after the Philippines generated over 50 million pesos in export sales following its participation in Gulfood 2023, according to DTI.

Overall, products with halal certification had a much greater sales potential at Gulfood, Linas Klimavicius, director of the Lithuanian Trade Office, said.

“The UAE presents a great potential as an export market for many categories; however, aligning with the right partner will make all the difference in one’s ability to scale and to do so quickly,” he noted.

“Dubai can and should be used as a trampoline to reach the rest of the GCC states.”
 

Halal Industry
Alshaya lays off Starbucks MENA employees amid Gaza crisis

Kuwait’s Alshaya Group plans to lay off workers at its Starbucks outlets after the coffee brand took a hit linked to the Gaza war. 

Calls for disengagement dealt a serious blow to Starbucks’ business since the start of the Israel-Gaza conflict, for its perceived pro-Israel stance. 

“As a result of the continually challenging trading conditions over the last six months, we have taken the sad and very difficult decision to reduce the number of colleagues in our Starbucks MENA stores,” an Alshaya Group spokesperson told Salaam Gateway.  

“We will ensure that we give our colleagues leaving the business, and their families, the support they need.”

Alshaya did not confirm the number of employees that would be released but according to a Reuters report this week, the retail giant plans to cut more than 2,000 jobs. According to earlier reports, it was in talks to sell a minority stake in the Starbucks regional business. 

Alshaya Group, headquartered in Kuwait, has been a licensed partner for Starbucks in MENA for more than 25 years. It operates over 1,300 coffee shops and employs 11,000 workers. 

“We are committed to the region, and we look forward to continuing to grow our business for many more years serving our customers,” the company said.

In January, Starbucks revised its sales forecast for 2024, expecting its full year comparable sales – both globally and in the US – to grow between 4% and 6%, from the previous range of 5% to 7% growth. 

“Beginning in mid-November, while our business continued to grow, the growth rate was impacted by three unexpected factors. First, we saw a negative impact to our business in the Middle East. Second, events in the Middle East also had an impact in the US, driven by misperceptions about our position,” said Starbucks CEO Laxman Narasimhan at the Q1 2024 Earnings Call. 

Starbucks forms part of a large group of Western brands that have suffered from consumer calls to shun them. 

Americana Restaurants International, operator of brands including KFC, Hardee’s, Pizza Hut, TGI Friday’s and Krispy Kreme, slashed almost 100 jobs in an internal restructuring, most of which were at the company’s Dubai headquarters, according to a January Bloomberg report. Its revenue fell 15% percent year-on-year in the last three months of 2023, while profit, too, was also down by nearly half. 

In a note published on LinkedIn beginning January, Chris Kempczinski, president, and chief executive officer at McDonald's Corporation, recognised that several markets in the Middle East and some outside the region were experiencing a “meaningful business impact” due to the war and associated misinformation. 


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