By: Naomi Carissa Intaqta and Rina Maulidyah, Auditors of LPPOM MUI
On various occasions, the Vice President of the Republic of Indonesia, KH Ma’ruf Amin, emphasized the importance of taking multiple actual steps so that Indonesia can become the world’s halal centre. The effort for Indonesia to become the world’s halal centre is not impossible. In addition to being recorded as a country with the largest Muslim population in the world, Indonesia also has various resources in the halal business sector.
Becoming the world’s halal centre with a strong halal ecosystem in its own country is impossible without the help of technology. Technology that is easily accessible anywhere and anytime, by the geographical conditions of Indonesia itself, an archipelagic country with a spread out territory, connects an integrated ecosystem.
This technology is realized as a blockchain, a decentralized data block that records transactions between two parties efficiently and can be verified permanently. Blockchain is usually collectively managed by a peer-to-peer network by following specific protocols for communicating between nodes or servers and confirming new blocks.
Once recorded, cite The Truth About Blockchain. Harvard Business Review. Harvard University (2017), data in a block cannot be changed retroactively without changes to subsequent blocks, which require majority consensus of the network.
This permanent concept helps guarantee the validity of information, whereas, in this digital era, hoaxes are quickly circulated. The idea of decentralization with no central point can reduce the risk of cyber attacks, increase transparency with easy data tracking, and reduce the risk of total loss if one node fails.
Halal Blockchain
Director of Strategy and Operations of LPPOM, Ir. Sumunar Jati, MP, said that the application of blockchain in the halal industry must cover various aspects, including global halal standards, the role of halal certification institutions, benefits for business actors and consumers, and the potential of blockchain technology in strengthening the halal ecosystem as a whole. Its function is related to detailed tracking that can help find the source of contamination of halal products. Tracking is done by recording supply chain activities identified in one accurate, coordinated, and credible data stream.
He also said that several developed countries have started implementing this. One of them is Germany. In this country, blockchain technology is applied in various industrial sectors, including the halal industry, to increase the supply chain’s transparency, security, and efficiency.
“Indonesia, as a country with a Muslim majority, must start looking at this technology to guarantee the halalness of products that are more integrated for consumers,” said Sumunar Jati.
Halal blockchain provides significant benefits for business actors, including increasing consumer trust, strengthening brand reputation, increasing supply chain efficiency, reducing the risk of fraud, and opening up global market opportunities. Sierad Produce, one of the companies in Indonesia, has felt these benefits. This company adopts blockchain technology to increase transparency and traceability of halal products in its supply chain.
Chicken, one of Indonesia’s main trade sectors, is a halal animal that is easy to breed and has a high protein content. Sierad Produce, as part of PT Sreeya Sewu Indonesia Tbk and Gunung Sewu Kencana Group, displays the entire series of production processes through the halal blockchain and innovative poultry system in real-time.
In its statement, Sierad Produce is committed that the products produced uphold halal values inseparable from quality values, showing the process of managing and inspecting chicken health, the cutting and post-mortem process, the production process, and good distribution.
Role of LPPOM
Not only can it be applied by the food industry, but LPPOM has played an essential role in developing halal standards and encouraging the adoption of blockchain technology to strengthen the halal ecosystem in Indonesia through the CEROL-SS23000 online system since 2012. Through this system, the inspection activities can be integrated with data from business actors to be audited to ensure the adequacy of halal criteria that refer to the MUI Halal standard.
LPPOM uses this system to store evidence of the implementation of halal product guarantees from the entire halal production process series, from various business processes of business actors, including logistics service products closely related to the supply chain of goods. The President Director of LPPOM, Ir. Muti Arintawati, M.Si., said that logistics services that distribute food ingredients are also included in the category that requires halal certification.
“As is known, logistics services are part of the supply chain that handles the flow of goods (including money and information) through the stages of procurement, transportation, storage, distribution, and delivery,” said Muti.
CEROL-SS23000 also helps new business actors who need a halal material database and helps with the registration of extensions and developments that require previous data records.
Today, blockchain is widely adopted in the Sharia Financial System. Collaboration between scholars and sharia experts drives halal blockchain, which integrates a digital asset management system with Islamic ethics and law principles.
Halal blockchain in the Sharia financial system prioritizes risk management and customer education in accepting the benefits, risks, and implications of using this blockchain technology. Halal Blockchain in Indonesia can be applied to cross-border money transactions, financial inclusion, Islamic boarding schools management, zakat and waqf funds management, and other economic activities that meet sharia criteria.
Indonesia has realized the potential of existing and developing natural resource wealth not to stop as users but to become creators of environmentally friendly technology. Sharia Economy is a motor of national economic growth supported by all levels of society to become a source of shared prosperity.
In Indonesia, halal blockchain has great potential to strengthen the halal ecosystem comprehensively, including increasing the competitiveness of Indonesian halal products in the global market, encouraging the growth of the sharia economy, empowering halal MSMEs, and ensuring the safety and authenticity of halal products. (***)
This article is included in the LPPOM Halal Journal Edition 168, accessible at the link https://halalmui.org/jurnal-halal/168/
