45 / 252
43
INVESTMENT POTENTIAL
Brunei Darussalam’s stable political environment and
non-interference foreign policy have brought about a
strong social and diplomatic identity to the country.
Working towards Brunei Vision 2035, the country aims to
nurture highly-educated and skilled citizens. It also aims to
develop an infrastructure and regulatory mechanism that
are business conducive to spur economic diversification.
Brunei will also endeavor to establish a ‘Nation of Zikir’
in line with its national philosophy of ‘Malay Islamic
Monarchy’ (MIB). Such a nation will produce people
of high morals with proper rules of etiquette. This will
further enhance political stability and social harmony in
the country.
According to Trading Economics – a New York-based
online platform that provides historical data, economic
forecasts, news and trading recommendations – Brunei’s
political stability and the absence of violence or terrorism
continue to rank high, taking into account the World
Bank’s collection of development indicators.
Two macroeconomic measures have made the country
an even more attractive destination for foreign direct
investment – the Competition Order 2015 and the
Consumer Protection Order 2011.
Brunei’s economy grew 1.3 per cent in 2017 after a
decline in 2016, according to the Department of Economic
Planning and Development which is the nation’s central
economic planning organisation.
Brunei Ranks 55 out of 190
In the first quarter of 2018, Brunei recorded 2.5 per cent
economic growth equal to BND4.38 billion. In the World
Bank’s Ease of Doing Business 2019 report, Brunei ranked
55 out of 190 economies, scoring 72.03 per cent. This is the
fourth highest among ASEAN countries behind Thailand,
Malaysia and Singapore. Brunei has continuously
improved its ranking for the last four consecutive years.
In another indicator, Brunei was also rated upper bound
in its economic outlook by the ASEAN+3 Macroeconomic
Research Office (AMRO) based in Manila. Within ASEAN,
Brunei along with Indonesia, Laos, Myanmar and the
Philippines are indicated as ‘improving economies’.
The AMRO’s ASEAN+3 Regional Economic Outlook 2018
report indicated that Brunei had the strongest gross
domestic product (GDP) growth, almost tripling from 0.6
per cent in 2017 to 1.6 per cent in 2018 and is expected to
double to 3.4 per cent in 2019.
Positive economic growth
The country’s economic growth improved as energy export
volumes and investment activities recovered, supported
by the progress of diversification projects. Recovery in
the oil and gas sector also brought further progress in
major infrastructure projects by foreign investments.
Additionally, Brunei’s trade surplus is expected to improve
from 2019 as the downstream industries begin their
commercial production and exports.
The country has a sound financial and banking sector with
capital adequacy ratio and liquidity ratio standings well
above the minimum requirements. In another positive
note, to improve the nation’s declining loans-to-deposit
ratio caused by declining loan growth to private sector, the
Autoriti Monetari Brunei Darussalam (AMBD) increased
personal financing cap from 40 per cent to 60 per cent and
expanded the total debt service ratio from 60 per cent to
a maximum of 70 per cent since 2016. These measures
are expected to spur credit growth in the local economy.