Indonesia has again ranked third in the State of the Global Islamic Economy (SGIE) Report 2024/2025 released by DinarStandard. This achievement confirms the consistency and resilience of the national Islamic economy in the face of global dynamics, while opening opportunities for Indonesia to lead the halal sector regionally and internationally.
As an annual report that serves as a strategic reference for the Organization of Islamic Cooperation (OIC) countries, SGIE 2024/2025 evaluates the performance of the Islamic economy from seven main sectors: halal food, Islamic finance, modest fashion, halal cosmetics and pharmaceuticals, Muslim-friendly tourism, media and recreation, and halal investment. Using the Global Islamic Economy Indicator (GIEI), Indonesia managed to maintain its position after Malaysia and Saudi Arabia.
In the latest SGIE report, Indonesia ranked first in the modest fashion sector, ahead of countries such as Turkey and the United Arab Emirates. This excellence is not only aesthetic, but reflects the competitiveness of the creative economy based on Islamic values and culture. Local brands such as Zoya, Elzatta, Buttonscarves, and Shafira represent the successful synergy between industry players, the hijabers community, and inclusive export policies. The government through the National Committee for Sharia Economics and Finance (KNEKS) continues to encourage the participation of local brands.
Indonesia also boasts strong performance in the Muslim-friendly tourism sector and halal cosmetics and pharmaceuticals, each ranking second globally. Lombok, Aceh, Yogyakarta, and several other regions are being developed as spiritual and ethical destinations, complete with prayer facilities, halal cuisine, and integrated local values. On the other hand, Indonesia's halal cosmetics and pharmaceuticals are growing rapidly through innovations based on natural ingredients and consumer awareness of Muslim-friendly products. Brands such as Wardah, Kahf, and ElsheSkin are emerging as pioneers in an industry increasingly aligned with sustainability and ethical trends.
The halal food sector, which should be the backbone of the real sharia economy, has dropped to fourth place. Despite high domestic consumption, Indonesia has not yet entered the top five global halal product exporters. The main challenge is that national halal certification is not yet fully recognized internationally. Harmonization of standards, halal diplomacy, and strengthening the supply chain are seen as key to expanding Indonesia's market penetration into the Middle East, Europe, and South Asia.
In the Islamic finance sector, Indonesia ranks sixth. The domestic Islamic finance market share remains below 11%, compared to Malaysia, which exceeds 40%. However, positive trends are evident through the growth of Islamic fintech, the digitalization of zakat and wakaf services, and the issuance of Green Sukuk by the government. Islamic economists urge the integration of the Islamic finance sector with the halal industry as a model for inclusive financing focused on social welfare.
The most notable achievement in the SGIE 2024/2025 is Indonesia's success in recording the highest halal investment in the world. A total of 40 transactions worth USD 1.6 billion were realized throughout 2023, covering the halal food, cosmetics, pharmaceuticals, halal technology, and Muslim lifestyle sectors. This figure demonstrates investor confidence in Indonesia's halal ecosystem, while also strengthening the country's role as a global halal investment hub. The government supports this achievement through the provision of digital platforms, mapping regional potential, and improving the regulatory climate. As the country with the largest Muslim population and vibrant Islamic cultural diversity, Indonesia has the moral legitimacy to lead the global Islamic economy. However, such leadership cannot be built solely on numbers but must be strengthened by institutional foundations, export strategies, and halal diplomacy.
Malaysia has led the SGIE for over a decade with an integrated global certification strategy. Saudi Arabia has emerged with its Vision 2030 and the expansion of the PIF sovereign wealth fund into the halal sector. Even Senegal has seen an 18-rank increase thanks to regulatory reforms and export support.
Achievements in the SGIE 2024/2025 demonstrate that Indonesia’s Islamic economy is not only growing but has become part of the mainstream of global development. The government has set a target to secure the top position in the SGIE by 2028, in line with the broader agenda of the RPJPN 2025–2045.
“Indonesia must not be content with third place. We must become the leader of the global Islamic economy,” Vice President Ma’ruf Amin concluded in his speech at the launch of the SGIE 2024/2025.
However, to realize this vision, multisectoral collaboration between regulators, industry players, academics, and the community is needed. IAEI, as an institution of Islamic economic science and advocacy, must continue to promote public education, institutional strengthening, and the involvement of the younger generation in shaping the future of Indonesia's halal economy.
