Koo Jin Shen
BANDAR SERI BEGAWAN
BRUNEI’S current economic growth is “unsatisfactory” according to a performance review recently published by the Department of Economic Planning and Development (JPKE).
GDP growth and unemployment rate, two of the four indicators used in measuring Brunei’s economic performance, were considered “unsatisfactory” by the JPKE. Trade balance and inflation rate were both considered “satisfactory” but still need more room for improvement.
JPKE said Brunei’s GDP contracted by 2.3 per cent in 2014, far below the national target of five to six per cent.
The oil and gas industry continues to dominate the economy, accounting for over 60 per cent of the GDP.
Much of the economic downturn in terms of GDP were attributed to the falling oil and gas prices. The data over the last decade has shown a strong correlation between the growth rate of the oil and gas sector (in terms of GDP) tied strongly with the country’s own GDP growth rate.
Brunei’s economic growth was dwarfed by the robust performance of the ASEAN-5 countries which are composed of Indonesia, Malaysia, Philippines, Thailand and Vietnam. Southeast Asia’s biggest economies grew by an average of 4.6 per cent in 2014.
Another economic indicator, the unemployment rate, was recorded at 6.9 per cent in 2014, which is higher than the national target of four per cent. JPKE said the unemployment rate is too high especially among the youth. The preliminary JPKE 2014 Labour Force Survey said youth unemployment was at 25.3 per cent.
The overall inflation rate of -0.2 per cent in 2014 was rated “satisfactory” considering the national target of two per cent or lower inflation per annum.
The department said this was due to support from subsidies, but also note that the negative rate is a concern.
Trade balance is also considered “satisfactory,” given that it is still at a surplus. However, the department said the sultanate still relies on oil and gas, citing the lack of diversity in the country’s export revenue sources.
The JPKE data showed Brunei would have recorded a trade deficit amounting to nearly four billion dollars in 2014 had oil and gas revenues been excluded from the computation.
Brunei is moving to diversify its oil-dominated economy and has been drawing in foreign direct investments (FDIs) to build up local enterprises and create more job opportunities for locals.
At the swearing-in ceremony in October, Dato Paduka Dr Hj Mohd Amin Liew Abdullah, the new deputy minister of finance and chairman of the Brunei Economic Development Board, said Brunei will be looking at all opportunities to intensify the economic diversification drive.
He also said his focus during his five-year term will be spearheading efforts to diversify the economy and to create “better jobs”.
“When we mention jobs, we talk about gainful employment, which is to create better jobs for our local people. This will be the primary focus,” he said.
He said Brunei is also aiming to increase FDIs and technology transfer and to diversify its economy.
Meanwhile, in late October, the Minister of the Energy and Industry at the Prime Minister’s Office launched the foundation laying ceremony for a multi-million dollar threading facility that produces drill pipes and casings for the petroleum industry, one of the projects meant to expand downstream services of the oil and gas industry.
The minister, Yang Berhormat Pehin Datu Singamanteri Col (Rtd) Dato Seri Setia Hj Mohd Yasmin Hj Umar highlighted excellent facilities and incentives as well as Brunei's geographical advantage in the region for this project to attract FDIs.
“We are about two hours away by flight to most of our neighbouring countries, so there is no reason why we cannot be the hub for business and supply the oil country tubular goods,” said the minister.
The new Minister of Primary Resources and Tourism Yang Berhormat Dato Paduka Hj Ali Apong also made comments on how Brunei’s tourism market can move forward.
In his opening speech during the launch of the regional seminar on the contribution of Islamic culture and its impact on the Asian tourism market in November, the minister said Islamic cultures and values can fulfill the tourists’ need for safety, cleanliness, reliability, acceptance, respect and friendliness.
He said Brunei, as a host nation, should strive to provide all of those expectations from the moment tourists arrive at the airport until the end of their trip.
The JPKE’s full report on its review of the country’s economic performance can be accessed at http://www.depd.gov.bn/DEPD Documents Library/NDP/Policy research/....
Sumber - The Brunei Times
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