A most fascinating and often underappreciated aspect of globalisation is how much it has changed our tastes, literally. When it comes to our cravings for food, the world is truly flat. Cuisine is the ultimate transnational enterprise, unconstrained by national borders or cultural boundaries.
Perhaps nowhere else in the world is this more apparent than at Dubai Mall. A look at its exotic restaurants and eateries reveals that although the diners may not speak the same language, each is fully fluent in the lingua franca of food: An unexpected mishmash of strong tastes and exotic ingredients. Besides, the popularity of Japanese cuisine and products is evident, as the mall has many Japanese restaurants, or dining places that also serve Japanese food.
In the UAE, there are more than 200 Japanese restaurants, and this is not counting the growing number of other restaurants and cuisines using Japanese ingredients in their dishes. The growing preference for Japanese food among consumers in the region is supported by business data. For example, ITSU Dubai Marina attracted a footfall of 64,000 customers in 2010. Nowadays, Japanese food products are no longer something unheard of in the Gulf region.
Japan and halal food
Japan may be an upstart in the halal industry, but it is not bowing down to more established competitors. The country’s business groups and financial institutions are pursuing a global marketplace for its domestic products. Compared with a shrinking domestic market, the Muslim countries of West Asia and North Africa (WANA) are a promising source of new and growing demand. Global demand for halal food is on the rise and the market is expected to grow by 20% by 2025. Thomson Reuters estimated in a 2016 report that out of nearly $2trn in global Muslim spending, food and beverage topped the category, with $1.17trn. It also estimated the figure to reach $1.9trn by 2021. GCC countries alone consumed $43.8bn worth of halal products in 2009.
Global Muslim Spending Across Sectors
Many Japanese entrepreneurs have entered the halal food market, including rice growers, condiment makers, and traditional wagashi confectioners. According to Keigo Nakagawa, a consultant at Halal Japan Business Association, three years ago, there were very few companies in Japan selling halal products; now there are over 200. A few years ago, there was no such thing as halal soy sauce in Japan; and now there are probably 10 halal soy sauce makers.
Japan has 22 different Halal-accreditation bodies, ranging from religious institutions to non-profit organisations. There has been a rapid increase in Halal certification in Japan over the past three years. For example, between 2011 and 2012, the Nippon Asia Halal Association certified five companies; from 2013 to 2016, 110 companies received certification. Around 15% of these are selling abroad.
Some Japanese halal food producers have even taken halal certification from authorities outside Japan. For example, Japanese sweets maker Kabaya Foods recently obtained halal certification from an organisation in the UAE for a production line at its factory in north-east Tokyo. It aims to start selling its signature panda-shaped chocolate snack in the region this year.
Global Halal Food Market Size in 2015
Fusen Bubble Gums is a confectionary company based in Marukawa, Japan. About 70% of its overseas sales are in WANA countries such as the UAE, Saudi Arabia, Jordan, and Yemen. In these countries, its bubble gum products are cheaper and slightly smaller than in Japan, in order to sell them at an affordable price of $0.7 or $0.8 cents. Ezaki Glico, another Japanese food major producing items ranging from ice cream to infant formula, is also considering expanding its exports to WANA.
Japan launched the PNB-Inspire Ethical Fund in 2014, its first halal fund’. It aims to provide financing to small and medium-sized Japanese companies for the development and marketing of Shariah-compliant products, services, and foods.
Additionally, Japan’s financial institutions have set up food and agricultural investment funds with partners in WANA. Both the Japanese government and business groups have actively promoted Japanese food brands in WANA, and have strived to introduce Japanese cuisine to the region’s consumers at various food exhibitions.
Gulf-Japan food fund
On October 25, 2015, Oman’s State General Reserve Fund joined Japan’s Mizuho Bank and Norinchukin Bank to set up a $400m private equity fund to invest in food and agribusiness industries. The fund aims to provide financing for the export of food and agricultural products from Japan to the WANA region, and related infrastructure such as temperature-controlled warehouses. It also plans to finance the setup of food processing factories, and even aquacultural facilities.
Soon after the fund was established, it embarked on a high-profile joint venture project to use Japanese technology to build the biggest table egg production facility in the Gulf, together with Oman Flour Mills Company, the UAE-based IFFCO group, and Japan’s Ise Foods. The project will have an annual capacity to produce 2.3bn eggs, 80% of which is for the local Omani market (around 45% of Oman’s demand for eggs is currently met through imports), while 20% will be exported to the UAE.
Introducing Japanese cuisine: Food exhibitions
JETRO and the Japanese embassies in the region take the lead in promoting Japanese food and ingredients in the GCC. Together with other Japanese business groups, they aim to introduce the traditional Japanese food experience to a broader consumer base, and try to educate the region’s customers about Japanese food. For example, in October 2014, JETRO Dubai hosted the grand opening of a long-running Japanese food exhibition organised by Japan’s Ministry of Agriculture, Forestry, and Fisheries. The exhibition ran in three different phases from September 16, 2014 to February 2015, and was aimed at raising awareness about Japanese food, ingredients, and culinary products.
In November 2016, JETRO Riyadh and Dubai together with the Japanese embassy held a Japanese food exhibition in the ambassador’s residence in Riyadh. Saudi officials, businessmen, and local media were invited to experience the traditional Washoku. This event coincided with Saudi Arabia’s 6th International Food, Beverage, and Hospitality Exhibition.
Saudi HORECA, JETRO in collaboration with the Riyadh Chamber of Commerce and Industry, and the Japanese embassy held a conference and food tasting session to introduce Japanese food products to chefs, wholesalers, and other industry professionals. More recently, in February this year, the Japanese embassy in the UAE, the Hokkaido government, and the Hokkaido Food Industry Promotion Organisation hosted the Hokkaido Food Fair at the residence of Kanji Fujiki, Japan’s ambassador to the UAE, for the first time in Abu Dhabi.
The appreciation for high-quality food is transnational, and unrestricted by geographic boundaries. With more Japanese restaurants, and more Japan-made halal products in the Gulf, the authentic taste of the country is becoming more accessible.
Japanese food exporters are increasingly enthusiastic about participating in the global halal markets; they have the support of investment funds with strong regional partnerships, as well as the facilitation of JETRO and Japanese embassies working actively to promote the country’s food culture on the ground.
Meanwhile, there is also a domestic campaign to make Japan more friendly to Muslim tourists. All this indicates Japan’s growing awareness of the importance of the Muslim market.
GCC countries are not categorised as developed countries, or as members of the Organisation for Economic Co-operation and Development, yet. However, they are important markets for early industrialisers such as Japan. As living standards in the Gulf keep improving, the importance of the Gulf markets for companies participating in global trade is only going to increase. And this is especially true for countries like Japan, whose domestic markets are shrinking.