The Barcelona midfielder, 18, already has six international caps to his name after breaking the record as the youngest Croatian to play for the national team at the age of 16.
While yet to feature for the Barca senior side with team-mate Lionel Messi, Halilovic has plied his trade in the Barcelona B team - and will come up against Messi at Upton Park on Wednesday.
"He is a young player who is already at Barcelona. Certainly he has the quality," Kovac said of his starlet.
"He will not start on Wednesday because our plan is that Mateo Kovacic will play the first 45 minutes and Alen will play the other half.
"That is the plan, it doesn't always go that way.
"Obviously he has great potential and there is a great career ahead of him, but only if he works really hard because that is a condition for every top athlete.
"Only with hard work can you succeed. He has spoken with his Barcelona team-mates regarding Wednesday's match. I'm sure they are all looking forward to it."
Kovac's biggest priority is Euro 2016 Group H qualifier with Italy on Sunday.
The two nations have maximum points from three matches to occupy the automatic qualification places.
Kovac rued the timing of the clash with the World Cup finalists, but knows it is a great opportunity to play against such a quality side.
"Our priority is the game against Italy in Milan, because it is a European qualifier," Kovac said.
"We are not happy with the schedule, we would like to play against Argentina after Italy, but since the schedule of European qualifiers is the way it is, we could only play before.
"For a small federation like the Croatian Football Federation it is important to use every opportunity to play friendly matches, especially given an opportunity like this.
"But I'm sure that all the guys here are worthy of this chance and play well against Argentina."
