MDEC: $2.8 Trillion for Digitalization in the Global Islamic Economy
The global Islamic Digital Economy (IDE) presents unparalleled economic and business opportunities. According to the State of the Global Islamic Economy Report 2022 by DinarStandard, Muslims worldwide spent an estimated $2 trillion in 2021 on various sectors, including food, pharmaceuticals, cosmetics, modest fashion, travel, and media. These consumption needs driven by Islamic faith are projected to reach $2.8 trillion by 2025, demonstrating a cumulative annual growth rate of 7.5%.
It is important to dispel the misconception that the IDE sector exclusively caters to Muslims. Instead, IDE is rooted in principles such as fairness, transparency, strong governance, and ethical conduct that transcend faith boundaries. These universal values offer an alternative to the Western economy and appeal to a diverse global audience.
Malaysia, as a global leader in Islamic Finance and Islamic Fintech, is well-positioned to seize the digitalization opportunities in this sector. The Malaysia Digital Economy Corporation (MDEC), the country’s digital investment promotion agency under the Ministry of Communications and Digital, has been entrusted with accelerating Malaysia’s IDE growth. MDEC’s focus areas within the IDE sector encompass three key sectors: Islamic finance (including Islamic fintech, social finance, and value-based intermediation), Halal industry (food, pharmaceuticals, and healthcare), and lifestyle (travel, fashion, media, recreation, and cosmetics).
Malaysia’s leading role in the global IDE landscape has been bolstered by digital inclusivity and a solid Islamic economy foundation. The country secured the top position in the Global Islamic Economy Indicator 2022 for the ninth consecutive year and the Global Islamic Fintech Index 2022, both compiled by DinarStandard. Malaysia boasts a mature Islamic finance and Halal ecosystem, supported by a wealth of talent and Shariah experts. With strong regulatory frameworks and clear guidelines for fintech and Halal investments, Malaysia is an innovation hub that houses pioneering market movers in Islamic finance solutions, products, and services.
In its efforts to create a thriving fintech ecosystem, MDEC actively engages with startups, investors, and innovation enablers worldwide. The agency acts as a catalyst, facilitating the entry of fintech companies into the Malaysian market and nurturing existing ones. MDEC offers valuable connections to its talent ecosystem, a pool of Shariah professionals, Islamic finance practitioners, and legal firms ready to provide professional advice.
To maintain Malaysia’s leadership in Islamic fintech, MDEC focuses on attracting quality companies that can be nurtured into global champions. The agency has formed strategic alliances with initiatives such as the FIKRA Accelerator, an acceleration program by the Securities Commission Malaysia (SC) aimed at scaling up innovative fintech solutions. MDEC is designated as the digital ecosystem partner for the program. Additionally, MDEC is a founding member of i-Connect Fintech in Islamic Finance, an industry-led collaboration network that harnesses innovation for Malaysia’s economic benefit. Furthermore, MDEC’s involvement as a partner in the RAIF Impact Challenge, a joint initiative by BNM and SC to support sustainability in Islamic finance, has resulted in significant success for its IDE companies.
Moving forward, Malaysia’s IDE sector represents the vast potential for digital inclusivity, leveraging the growing number and affluence of Muslims worldwide. MDEC envisions that Malaysia’s thriving community of IDE companies will propel the country to prominence and accelerate economic growth. This ambition aligns with the Malaysia Digital initiative, aimed at establishing Malaysia as a global leader in the Islamic digital landscape. MDEC, as a high-powered one-stop agency, supports the growth and expansion of tech companies at all stages, facilitating their entry into Malaysia and beyond. Interested parties are encouraged to reach out to MDEC
Read further here: https://gulfbusiness.com/how-malaysias-mdec-is-spearheading-the-countrys-digital-agenda/
