Halal Industry Products influence on Current Account in OIC Economics in Asia on 2015 – 2019

Abstract

The Halal industry is growing rapidly, which is driven by the high public demand for halal products. Halal products in various aspects of the industry are the new prima donna. The government hopes that halal products in the export and import approach can overcome the country's problems, especially the current account deficit. The purpose of this study analyses the effect of halal industrial products in the export and import approach on the current account balance of OIC member countries in Asia in 2015-2019. This type of research is quantitative research. The model calculated using the FEM (Fixed Effect Model) which discusses the correlation between the dependent variable and the independent variable to determine the effect on the current account balance from 2015 to 2019. The results found the halal industrial products which are proxied by the export and import of halal products greatly affect the current accounts in 13 OIC member countries in Asia. Exports of halal products have a positive and significant effect on current accounts in OIC member countries in Asia. Meanwhile, imports of halal products have a negative and significant effect on current accounts in OIC member countries in Asia. Based on the results of the study, Kyrgyzstan ranked first with the highest number of halal product exports affecting current accounts among OIC member countries in Asia. Meanwhile, Saudi Arabia ranks thirteenth with the lowest number of halal product exports affecting the country's current accounts. In contrast with exports, Malaysia ranks first with the highest number of imports of halal products affecting current accounts among OIC member countries in Asia. Meanwhile, Lebanon ranks thirteenth with the lowest number of imports of halal products affecting the country's current accounts.