Answer for Written Question PT027

QUESTION

Yang Berhormat Pehin Orang Kaya Indera Pahlawan Dato Seri Setia Awang Haji Suyoi bin Haji Osman

YANG BERHORMAT PEHIN ORANG KAYA INDERA PAHLAWAN DATO SERI SETIA AWANG HAJI SUYOI BIN HAJI OSMAN asked the MENTERI DI JABATAN PERDANA MENTERI DAN MENTERI KEWANGAN DAN EKONOMI II to state some of the latest progress in efforts to diversify the economy, as well as the new approaches planned to accelerate these economic diversification efforts.

ANSWER

Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II

Economic diversification efforts continue to show encouraging progress, as evidenced by the increase in the contribution of the non-oil and gas sector to the national GDP, from 45 per cent in 2015 to 54 per cent in 2025. In addition, non-oil and gas exports have also increased to 60 per cent, compared to 7 per cent in 2015.

This achievement has been driven, among other factors, by growth in the five priority sectors, which continue to serve as growth drivers in leading economic development and diversification. These priority sectors have recorded encouraging GDP growth, with an average growth of 5.5 per cent over the past 10 years, increasing from BND2.4 billion in 2015 to BND4.0 billion in 2025:

➢ Downstream Oil and Gas Sector recorded an average annual growth of 31.3 per cent from 2015 to 2025, driven by increased production of petroleum and chemical products through the attraction of high-impact investments such as Hengyi Industries Sdn Bhd, Brunei Methanol Company Sdn Bhd, and Brunei Fertilizer Industries Sdn Bhd, which have expanded the value chain and increased domestic production capacity.

Petroleum and chemical manufacturing activities will be further strengthened with the Hengyi Phase 2 project, which is expected to be completed by the end of 2028 and commence operations in 2029. This expansion will increase refining capacity to 20 million metric tonnes per year (400,000 barrels per day), compared to the current capacity of 8 million tonnes per year. It will also introduce new supply feed for liquefied natural gas (LNG) and ethane, as well as enable the production of new high-value derivative petrochemical products that can be used to manufacture daily necessities. For example, ethylene and polyethylene are key materials used to produce various types of plastic goods such as bottles and food packaging, while butadiene is used to produce synthetic rubber for vehicle tyres and shoe soles. Producing these high-value materials domestically will open up new business opportunities for local companies and provide more employment opportunities for locals in the relevant industrial value chain.

In addition, further efforts to expand downstream activities are also focused on attracting new investments to the country, including, among others, a proposal to produce chemicals (Isopropyl Alcohol – IPA) in collaboration with a company from India, as well as the establishment of a hydrogen production facility and utility modular container in collaboration with a company from the Republic of Indonesia.

➢ Services Sector grew by an average of 1.3 per cent annually from 2015 to 2025, in line with the development of trade, transport and business services activities. In terms of logistics, several efforts have been undertaken to establish new shipping routes, such as through the establishment of NEXT Bahtera Maritime Sdn Bhd, which connects Muara Port with new strategic ports such as Lianyungang in the People’s Republic of China, Jakarta in the Republic of Indonesia, and Subic in the Republic of the Philippines. In addition, the establishment of direct shipping routes by Shandong International Transportation Corporation (SITC) and Warisan Shipping Lines connecting Muara Port to Qinzhou Port has shortened the sailing time from 12 days to 7 days.

This sector will be further strengthened by upgrading the container terminal capacity at Muara Port from 220,000 to 500,000 TEUs per year through the construction of a new 250-metre container wharf and an 88-metre service vessel wharf. The project is also planned to include the development of a 3.62-hectare Port Trade Zone within the container terminal to facilitate the importation, release, repackaging and export processes.

➢ Food Sector recorded an average annual increase of 1.3 per cent from 2015 to 2025, driven mainly by developments in the livestock, fisheries and food manufacturing industries. Proposed strategic project developments such as the Agri-Tech Food Zone and Aquaculture Innovation Centre in Negara Brunei Darussalam, in collaboration with the Government of Singapore, as well as the upgrading of the Brunei Food Industry Development (BFID) facility, which is expected to commence operations in the first quarter of Financial Year 2026/2027, are among the initiatives being pursued to further increase local production capacity and strengthen the resilience of the national food supply.

In addition, in supporting the contribution of micro, small and medium enterprises (MSMEs) to the growth of the local food sector, the Brunei Economic Development Board (BEDB) is also planning to provide a ready-built facility in collaboration with the Department of Agriculture and Agrifood, Ministry of Primary Resources and Tourism. It will function as an incubation hub to enable MSMEs to further scale up their operations, improve productivity and subsequently contribute to long-term food security efforts and the economic diversification objective.

➢ ICT Sector grew by an average of 2.6 per cent annually from 2015 to 2025, in line with increased broadband usage and the growth in internet subscribers. This development has been further strengthened by the enforcement of the Perintah Perlindungan Data Peribadi (PDPO) 2025 to ensure a secure digital environment, as well as the launch of the national ‘tarus’ payment system in early 2025, which unifies the country’s digital payment ecosystem to facilitate faster and more inclusive cashless transactions. In line with the Digital Masterplan 2025 and Pelan Transformasi Digital Brunei (2026-2030), this development will be strengthened through the development of a more organised digital ecosystem, efforts to digitally transform Government services, and the promotion of innovation in adopting new technologies such as AI in the country’s socio-economic activities. Initiatives being undertaken include the development of artificial intelligence (AI)-based data centres and data centre facilities with internationally certified Tier III designs.

➢ Tourism Sector recorded an average annual growth of 1.5 per cent from 2015 to 2025, as a result of increased international tourist arrivals and flight movements to and from Negara Brunei Darussalam. Efforts will continue to focus on strengthening the country’s tourism products and facilities, including an emphasis on niche tourism such as ecotourism, more targeted promotional and marketing initiatives, as well as further increasing exposure for the country’s branding.

The Government of Negara Brunei Darussalam remains committed to accelerating economic diversification efforts through the implementation of integrated strategies that emphasise innovation, cooperation and human capacity building. These measures will be monitored through clear performance indicators, including the contribution of the non-oil and gas sector to GDP, the creation of new jobs and the growth of high-impact investments.