The Brunei Economic Development Board (BEDB) was established in 2003 with the main objective and role of growing and diversifying Brunei Darussalam’s economy towards achieving Brunei Vision 2035.
The Board focusses on developing local economy by investing in exportoriented industries and creating spin-off opportunities for local businesses. Such strategies have the positive side effect of generating more employment opportunities for locals.
Targetting four key areas – attracting investments, strengthening local businesses, increasing research, development and innovation, and delivering key infrastructure projects – BEDB conducts research on the local economy and analyse their ndings to develop its own strategies and initiatives. The initiatives aim to not only maximise economic benets in the country but to also develop sound strategic recommendations for potential investors.
BEDB is at the forefront in facilitating foreign investments into the country and works closely with investors to bridging the gap between their business demands and the country’s economic needs. BEDB also provides information on the local investment climate, developmental requirements, laws and regulations, costs of doing business, and project specic information.
• Halal – Pharmaceutical and health supplements, aquaculture, agriculture, food processing, manufacturing and distribution and cosmetics
• Technology and Creative Industry – Data centre, digital media Internet of Things and biotechnology
• Business Services – Transportation and logistics, financial services and business process outsourcing
• Tourism – Medical tourism, cultural tourism, hospitality and eco-tourism
• Downstream Oil and Gas – Petrochemicals and downstream oil and gas
By 2025, the global Halal food industry alone is estimated to be worth USD2.10 trillion. The Muslim population is expected to grow reaching up to two fifth of the India topping the list. This is a good opportunity for Brunei to pursue economic diversification and create job opportunities by developing the Halal food industry. The amendment to the Halal Certificate and Halal Label Order in 2017, recently updated, opens up opportunities for newer industries to come in. This includes cosmetics, consumable products, and logistics services related to transportation, storage, packaging and others. Several FDI’s Halal-related businesses have set foot to invest and make production.
Attracting foreign direct investments (FDIs) into Brunei is one of the main strategies adopted to diversify Brunei’s local economy. In 2016, an FDI and Downstream Industry Steering Committee was established and tasked with implementing reforms to increase competitiveness in a bid to attract foreign investors to the nation.
In order to encourage FDIs coming into the country, the government also set up a fast-track system allowing FDIs to expedite the processes of opening up a business in the nation.
BEDB works in tandem with the Invest in Brunei FDI Action and Support Centre (FAST) – an agency that helps to coordinate with other stakeholders – to ensure investors gain easy access to obtain permits, licenses and approvals, including development and construction approvals as well as approvals for the recruitment of foreign labour. To ensure a smooth operation, a dedicated account manager will be assigned to each investor as a single focal point and liaison officer. BEDB also collaborates with Darussalam Enterprise (DARe) to provide operational support for the FDIs.
Through collaborations with these organisations, BEDB has helped facilitate a large number of FDI projects in Brunei. One of the biggest is the establishment of Hengyi Industries Sdn Bhd, which is a joint venture between the country and the China-based Zhejiang Hengyi Group.
Under the agreement, Hengyi Industries Sdn Bhd is expected to operate a multi-billion dollar oil refinery and aromatics plant on Pulau Muara Besar (PMB) by July 2019.
The large scale downstream petrochemical project sits on a massive site area of 260 hectares, transforming PMB into a mega industrial facility. Once up and running, the project is expected to deliver eight million tonnes of petroleum by-products per year such as aromatics, gasoline and diesel as well as to meet the local fuel demand.
In 2017, Brunei Fertilizer Industries Sdn Bhd (BFI) signed an agreement with Germany-based worldwide engineering and construction services provider ThyssenKrupp Industrial Solutions AG (tkIS) to set up an ammonia and urea plant at the Sungai Liang Industrial Park (SPARK).
Also facilitated by BEDB, the project will begin production by early 2021, with an estimated 1,000 jobs created during its construction phase, a further 200 jobs in its operational phase as well as 600 indirect jobs in the service sector.
Brunei offers a business-friendly environment. In addition to the dedicated support for investors – in which BEDB, FAST and relevant government agencies work closely to provide assistance to investors from submission of proposals up to implementation and operation of projects – there are other attractive factors that will help business including:
• 100 per cent Foreign Ownership – Companies incorporated in Brunei are permitted to have 100 per cent foreign ownership.
• Credible Co-Investment Partnership – Credible co-investment partnerships are available. Partners include Ministry of Finance’s Strategic Development Capital Fund (SDC) and Government Linked Companies (GLCs).
• Favourable Tax Regime – There are no sales, payroll, capital gains, manufacturing and personal income tax. Corporate Income Tax in Brunei is at 18.5 per cent which is one of the lowest in the region.
• Sound Legal and Regulatory Framework – Brunei’s laws foster a pro-business and pro-investor environment. Brunei also has a robust and comprehensive intellectual Property (IP) Protection and accessibility to international filing routes.
• Competitive Utility Rates – Brunei has one of the lowest tariffs for basic utilities in the region, keeping business operating costs to a minimum.
• Readily Available Infrastructure – Over 30 designated industrial sites available in Brunei with good connectivity to roads, water, electricity and broadband Internet.
In Brunei, the emphasis on diversifying economy remains strong to ensure the fulfilment of a dynamic and sustainable economy reaching income per capita among the top countries. With Brunei’s business-friendly environment and continuous effort from BEDB, it is hoped Brunei Vision 2035 will be achieved.
Copyright 2019 Borneo Bulletin Yearbook 2019 All rights reserved.