(Ecofin Agency) - Nigeria, with its majority Muslim population, spends hundreds of billions annually on halal products. The government sees major potential in this sector to drive economic growth in the coming years.

The Federal Government of Nigeria is working on a strategy to position the country as a key player in the global halal economy, aiming to add $1.5 billion to its GDP by 2027. This initiative, announced on September 16, 2024, seeks to diversify the economy by offering services that meet Islamic standards.

The plan will bring together government agencies, private sector leaders, and international partners to capitalize on Nigeria’s position as the eighth-largest halal economy in the world.

“The Halal economy represents a tremendous opportunity for Nigeria to diversify our economy, generate foreign exchange, and achieve sustainable growth,” said Aliyu Bunu Sheriff, special assistant to the president on export expansion.

This announcement comes as Nigeria continues to rely on Islamic finance to support its development. A report published in May 2024 by the cabinet of Abbas Chérif, an independent Islamic finance consultant, revealed that Nigeria has already raised $1.43 billion through sukuk bonds to finance its development.

According to the 2023 report on the halal economy by Dar Al Halal, Nigeria boasts a large Muslim population, which makes up over 50% of the total population. However, the country’s halal exports currently make up only 5.7% of Africa's $4.2 billion halal exports to member countries of the Organization of Islamic Cooperation (OIC).

In an economy heavily dependent on imported finished goods, Nigerian authorities hope to tap into the vast potential of the halal market, both internationally and locally. Domestic spending on halal products and services in Nigeria reached $107 billion in 2022 and is projected to grow at an annual rate of 10.7%, reaching $180 billion by 2027.