Trump's Halal Ambitions
Indonesia continues to examine the US-Indonesia Reciprocal Trade Agreement (ATR). In this instalment, published on a Friday during the holy month of Ramadhan, we enter territory that for this nation represents not merely regulation, but identity: halal.
In a country with the world’s largest Muslim population, a halal label is not simply a sticker on packaging, but a symbol of trust, peace of mind, and a social contract between state and citizens.
The question of whether a product is halal touches both faith and economy, worship and industry. It is therefore noteworthy when halal issues emerge in international trade agreements—not to be eliminated, but standardised within a framework of global commerce.
One provision in the US-Indonesia ATR states: “Indonesia shall exempt U.S. products from any halal certification and halal labeling requirements.” At first glance, this appears merely technical, even practical for facilitating trade in American manufactured products such as cosmetics or medical devices.
However, for a society that regards halal as central to consumption certainty, this clause raises new questions: who determines halal standards in an era of global commerce?
Such provisions have inevitably prompted protests from religious scholars who feel responsible for safeguarding the faith and worship of the Muslim community. The Indonesian Council of Ulama (MUI), for instance, has immediately issued guidance against purchasing products without halal labels.
The ATR agreement also touches upon slaughtering practices: “Indonesia shall accept U.S. slaughter practices that comply with Islamic law or standards of any country that is a member state of the SMIIC.”
In other words: “Indonesia must accept slaughter practices in the United States that comply with Islamic law or the standards of member states of SMIIC.”
The SMIIC (Standards and Metrology Institute for Islamic Countries) represents an attempt to harmonise halal standards across the Islamic world. From a trade perspective, recognition of international standards reduces technical barriers and facilitates the movement of goods.
However, from the perspective of regulatory sovereignty, this means domestic authority no longer serves as the sole arbiter of halal practice. It becomes part of a system of global standard recognition.
In the global economy, standards often prove more powerful than tariffs. Tariffs can be negotiated. Standards shape market architecture.
Another clause in the ATR broadens the halal exemption: “Indonesia shall exempt non-animal products and animal feed… from any halal certification and halal labeling requirements.”
From a scientific and contemporary jurisprudential standpoint, this exemption can be rationally debated. Admittedly, not all products require halal certification. Iron, for example, certainly needs no halal certification or labelling. But clothing? That must be halal.
It is also true that many Muslim countries apply risk-based approaches. What is striking, however, is not the technical aspect of these exemptions, but the principle: halal regulation now falls within the discipline of international commerce.
In Indonesia’s history, halal has been part of state service to its citizens. The state set standards, monitored implementation, and guaranteed consumer certainty.
Following this agreement, halal implementation must now consider trade obligations, international standards, and bilateral agreements.
The state retains authority. Yet that authority now operates within the framework of treaty obligations. In the modern world, sovereignty does not disappear. It is negotiated.
Halal is not merely a religious issue. It is also a global economy worth trillions of dollars. The halal industry spans food, cosmetics, pharmaceuticals, tourism, and finance. Indonesia has potential to become a major player in this ecosystem.
However, being a major player requires the ability to set standards, not merely follow them. This trade agreement, called reciprocal, actually weakens our halal standards.
Nations that control standards control markets. The European Union sets global food safety standards. Japan sets industrial quality standards. America sets digital technology standards.
The question is: does Indonesia wish to be the world’s largest halal market, or also become the arbiter of global halal standards? Certainly, the ATR provisions grant advantage to American standards.