China Turns to the Muslim World As Its Next Manufacturing Frontier
After establishing a leading position in the global markets for solar panels, electronics and electric vehicles (EVs), China is now targeting the Muslim world as a vast new commercial market. To overcome domestic economic slowdown and growing tariffs and trade barriers in Western countries, Chinese exporters are seeking to expand into halal food, cosmetics, pharmaceuticals and modest fashion. According to a special report by US financial news outlet MarketWatch, a wide range of halal products from prayer mats, Quran stands and Ramadan lanterns to hijabs and modest clothing are now being mass-produced in China’s industrial hubs, including the wholesale trading center Yiwu. International buyers are having these products manufactured in China under their own brands.
According to research firm DinarStandard, China exported $32.5 billion worth of halal food, clothing, pharmaceuticals and cosmetics to the 57 member states of the Organization of Islamic Cooperation (OIC) in 2023. This made China the leading supplier of halal products to OIC countries, surpassing India and Brazil. The report also said Muslim consumers worldwide spent around $2.6 trillion on food, clothing, cosmetics and travel in 2024. This figure is projected to reach $3.56 trillion in the coming years. China is adapting its vast manufacturing sector to halal products to tap into this promising market. China has a strong advantage in producing goods at low costs and within short timeframes. Local brands in Indonesia, Malaysia, Saudi Arabia and the United Arab Emirates that lack large manufacturing facilities are having halal products made in China under their own labels.
However, analysts say China’s rapid success in the halal market will not be as easy as in cheap electronics. Religious trust and halal certification are crucial alongside product quality. Muslim consumers are particularly conscious of the sources of gelatin, alcohol and animal fats used in cosmetics and medicines. The cost of international halal certification and factory inspections could also pose a major challenge for small Chinese manufacturers. Moreover, international criticism of China’s treatment of Uyghur Muslims in Xinjiang raises ethical questions about its commercial expansion into the Muslim world. Analysts believe China’s next export revolution will depend not only on low prices but also on winning the religious trust of Muslim consumers.
