Despite the rapid growth of the halal economy during the last decades, the number of empirical researches related to the determinants of international halal trade is still limited. This study provides an initial attempt to investigate the factors that impact the value of halal trade flow. It focuses specifically on the halal F&B sector which is the biggest segment of the halal economy. To overcome the limitations of halal trade database, the study applied the WTO assumption when assigning HS codes on the specific trade concerns database (in the case of halal food and beverage) together with the Shariah principle of "presumption of permissibility" to acquire an approximate value of halal F&B trade between countries. The tested samples contain bilateral trade information of 59 countries (20 OIC members), selected according to their economic size and value of F&B exports. The estimation period covers the period from 2007 to 2016. The examination period is limited due to the availability of restriction on religion data which is one of the focused variables. In addition, the study did not exclude the world financial crisis period (2007-2008) because of the necessity in the nature of an F&B product that less elastic to the impact of the financial crisis. In terms of methodology, we applied the gravity model which is the dominant empirically tested model of international trade as the ground model of the analysis, then imposed the Poisson Pseudo-Maximum Likelihood (PMML) which is highly recommended and widely accepted as workhorse estimator for gravity model as the main method of the regression test. The method has an advantage in dealing with the presence of heteroscedasticity, heterogeneity, autocorrelation, and the issue of zero-valued trade observation which frequently observed in bilateral trade.

This study determined the worth of the Halal food and beverage trade. We imposed the Poisson Pseudo-Maximum Likelihood after applying the gravity model (PPML). The economic size of trading partners, regional trade agreements, a shared border, and a shared language are determinants with a strong beneficial effect on commerce. On the other hand, the negative trade factors are the distance between trading parties, the exporting country's income, the exchange rate comparison, and landlocked trade. In the meantime, the income level of the importing nation and the colonial relationship appeared to have little impact on trade, as does OIC trade cooperation. Halal certification has a considerable beneficial influence. However, limitations on religious considerations (GRR and SHR) have a significant negative impact on trade.

The study aimed to determine the antecedents or drivers of the Halal food and beverage trade. The Halal F&B statistics were manually derived by applying the Shariah principle of "presumption of permissibility" and the WTO assumption when assigning HS codes on the specific trade concerns database to determine the approximate value of Halal F&B trade between countries, which is an important contribution of this study. We utilized the gravity model of international trade and the Poisson-Pseudo-Maximum Likelihood (PPML) approach, which is the gravity model's commonly suggested estimator. The examined samples include bilateral trade data from 59 nations (20 OIC members) between 2007 and 2016. The tested determinants are the variables of the economy, distance, level of income, exchange rate, regional trade agreement, common border, common language, colonial relationship, and landlocked commerce. Results indicate that the economic size of trade partners, regional trade agreements, shared borders, and common language significantly positively impact the value of Halal F&B exports. In contrast, distance, exporting nation income, exchange rate, and landlocked trade significantly negatively impact. Meanwhile, it appeared that neither the income level of the importing country nor its colonial relationship had a substantial impact on commerce.