Sabah: Surpassing Target

Datuk Seri Musa Aman

As the second phase of the Sabah Development Corridor (SDC) gets under way, the chief minister, Datuk Seri Musa Aman, has announced that cumulative planned investment in the pro­gramme has reached RM57 bil­lion (US$17.7 billion) – almost four times the target value set just last year.

The chief minister also said that the state government was encouraging new investments in the form of anchor compa­nies, small and medium-sized enterprises and other start-ups in targeted sectors. These included the biotech and infor­mation and communications technology (ICT) industries and designated strategic devel­opment areas (SDAs).

To sweeten the deal, a com­petitive package of customised incentives to attract private-sector investment to the state was in the planning stages, Musa, who is also the chair­man of the Sabah Economic Development and Investment Authority (SEDIA), said at a September 8 meeting of the authority.

SEDIA’s remit included pro­moting and accelerating the development of the SDC into a leading economic region and a preferred investment destina­tion. SEDIA was also laying the groundwork for future growth by drawing pioneering technology to SDC, including ICT firms.

The SDC, a federal govern­ment initiative launched in 2008, aimed to triple the state’s GDP per capita and increase its total gross domestic product (GDP) four-fold by 2025. In all, the SDC was expected to create more than 900,000 new jobs.

While Sabah’s state govern­ment agencies and govern­ment-linked companies were tasked with carrying out SDC’s initiatives, overall implemen­tation of the plan was the re­sponsibility of SEDIA, which had been participating in domestic and overseas invest­ment and trade missions.

The SDC, a federal govern­ment initiative launched in 2008, aimed to triple the state’s GDP per capita and increase its total gross domestic product (GDP) four-fold by 2025

The response from the trade missions had been quite prom­ising, with cumulative planned investment in the SDC reach­ing RM57 billion (US$17.7 bil­lion) between the programme’s launch in 2008 to the first half of 2011, Musa said.

According to Economic Plan­ning Unit figures cited in the 10th Malaysia Plan (10MP), the target value of investment in SDC is RM16 billion (US$5 bil­lion). At the end of the fourth quarter of 2009, the SDC had secured actual investments of almost RM12 billion (US$3.7 billion).

The energy, manufacturing, and oil and gas sectors have attracted 45.6 per cent (RM26 billion or US$8.1 billion) of the cumulative total investment planned, while the services sec­tor, especially real estate and tourism, had brought in 39 per cent (RM22.1 billion or US$6.9 billion) of the total planned investment.

Coming in last place was the agricultural sector, which had historically been a main pillar of the state’s economy, but had accounted for only 5.5 per cent (RM3.2 billion or US$994.6 mil­lion) of planned investment. However, agriculture’s poor performance was expected to im­prove with the implementation of key agro-based projects.

“Related agro-based projects included the palm oil industrial clusters in Sandakan and Lahad Datu; agropolitan projects in Tongod, Kemabong, Pitas, Kota Belud and Beluran; Keningau In­tegrated Livestock Centre; per­manent food production parks; [and] Sabah Agro-Industrial Precinct and Fisheries Complex in Kuala Penyu,” Musa said.

Indeed, the Brunei investment agency had shown interest in participating in the develop­ment of Sabah’s agro-based sec­tor via these projects. In addition to Brunei Darussalam, govern­ment and business leaders from East Kalimantan, or Kaltim, had also approached the sabah government, Musa said.

Palm Oil

Enhanced economic and trade relations between Sabah and Kaltim, together with Brunei, would boost the potential of Sabah to serve as a regional trading and logistics hub. At the same time, this develop­ment might lend some support to the sdc initiative to carve a new east asian silk route linking the rapidly growing BIMP-EAGA [Brunei Darus­salam-Indonesia-Malaysia-the Philippines east Asean growth area] to the dynamic east Asian economies,” Musa said.

In its first phase, which ran from 2008 to 2010, the SDC focused on boosting Sabah’s liveability and making it easier to conduct business in the state, with infrastructure upgrades, lowered costs of doing business and poverty eradication projects the main accomplishments.

Now in its second phase, which would run until 2015, the SDC’s major initiatives included a long list of SDAs that were meant to generate employment and income for Sabahans and help jump-start sustainable economic growth in the state.

In the long term, the SDC’s growth blueprint involved a wide variety of measures, including leveraging Sabah’s geographical location, natural resources, cultural heritage and biodiversity; building a high-margin services sector in logistics and tourism; bringing rural people into the economic process; enhancing agricul­tural yields; increasing the value of Sabah’s resources by fostering downstream manu­facturing; conserving and protecting the environment; and implementing growth via good corporate practices.

These were ambitious goals, but with planned investment already almost four times the target value – and neighbours lining up to get in on the ac­tion – it seems as if the SDC is firmly in control of the state’s future growth.

Read more: http://www.theborneopost.com/2011/10/23/sabah-surpassing-targets/#ixzz26F38iDeP