DAY 9 AFTERNOON
9TH MARCH 2024 - AFTERNOON
Help needed with Jawi and Arabic characters, please email pr@queeniecy.com if you have experience with Markdown.
The information presented on this webpage is based on processed PDFs downloaded from the official website and translated using OpenAI technology. We have taken steps to ensure accuracy, but if you identify any discrepancies or issues, please kindly notify us at pr@queeniecy.com so that we can make necessary adjustments. Thank you for your understanding and cooperation.
Despite our best efforts to ensure the accuracy of these translations, please note that they were performed by AI technology. As such, we cannot guarantee their infallibility and are not responsible for any inaccuracies or misinterpretations that may arise from the translated content. If you have suggestions for better translations, please email the specific section along with your proposed translation to pr@queeniecy.com. We are committed to continuous improvement and greatly appreciate your input.
Yang Berhormat Yang Di-Pertua
In the name of Allah, the Most Gracious, the Most Merciful, all praise is due to Allah, Lord of all the worlds, and peace and blessings be upon our Master Muhammad, his family, and all his companions. Your Honourable Members, the State Legislative Council is still debating the Bill (2024) Supply, 2024/2025 as proposed by Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II.
To allow us to examine the Titles contained in the Bill one by one, I adjourn the State Legislative Council meeting and we shall reconvene in full Committee Stage.
(The Council meeting was adjourned)
(The meeting convened as a Committee)
Yang Berhormat Pengerusi
In the name of Allah, the Most Gracious, the Most Merciful, Your Honourable Members. Now this council is convening in full Committee Stage to consider the Bill (2024) Supply, 2024/2025 for scrutiny one by one.
In the Committee Meeting we had this morning, we started discussing and debating Titles under the Ministry of Finance and Economy and its Departments.
With me here is still a list of Appointed Your Honourable Members who would like to also partake in debating this Ministry of Finance and Economy Title.
To kick things off again, I invite Yang Berhormat Dayang Hajah Rosmawatty binti Haji Abdul Mumin.
Yang Berhormat Dayang Hajah Rosmawatty binti Haji Abdul Mumin
Thank you, Yang Berhormat Pengerusi.
Yang Berhormat Pengerusi dan Your Honourable Members, peace be upon you, and salam Sejahtera.
Kaola have 2 questions Yang Berhormat Pengerusi: -
Regarding Brunei Halal branding. The Brunei Halal brand, established in 2009 under Ghanim International Corporation Sdn Bhd, now has about 40 available products. With a strong halal reputation and widespread recognition, the opportunity for Brunei's halal growth is immense given the increasing demand for the halal sector internationally.
Kaola's question, how can Brunei Halal promote the country's image internationally?; and
Seeking enlightenment on Brunei Halal's short and long-term strategies to expand this brand? With international recognition and high standards, how do we showcase these products domestically and abroad? Does the ministry have sufficient allocation?
Based on kaola's observation, Brunei halal products are still not the first choice for Brunei citizens themselves. This leads to the question of whether there is a need to improve the Brunei Halal brand itself or to create a concept of branded patriotism as practiced in neighboring countries where the use of local products is emphasized for domestic consumption.
This domestic consumer support will indirectly promote Brunei's halal products globally. Referring to the Brunei Economic Blueprint, the success of the blueprint is envisioned as our export will be diversified with an increase output from the private sector such as new petrochemical products and premium food products.
From this, kaola believes Brunei already has the ecosystem ready to leverage halal branding and promote Brunei.
It just requires more integrated efforts to push this brand further than what we have at the moment. Especially domestically by raising the spirit of the Brunei nation towards their local brand before expanding further abroad.
Kaola's second question is about the Ministry of Finance and Economy's Aspiration 3. Relating to Aspiration 3, which is open and globally connected economy in the Brunei Economic Blueprint, kaola seeks enlightenment on the ministry's self-assessment regarding Brunei's position in this aspiration.
Brunei aims to explore international markets by leveraging strategic partnerships such as FDI, FTA, and MOU signed. Challenges often raised by small market economic challenges and limited economic scale require creative and effective initiatives.
Although many agreements have been signed, the real impact is yet to be felt by the citizens.
Kaola's question, to realize this aspiration 3:-
How does the Ministry of Finance and Economy assess Brunei's achievement in achieving the aspiration of open and globally connected economy as recorded in the Brunei Economic Blueprint? What achievements have been made and what challenges are still faced especially in terms of enhancing Brunei's economic and financial engagement in the global market?
What concrete steps have been taken by the ministry for the aspiration of open and globally connected economy including leveraging strategic partnerships such as FDI, FTA, and MOU in the context of enhancing Brunei's economic and financial activities in the global market.
How can Brunei facilitate and assist in accelerating the establishment of businesses like the airline companies recently announced such as Gallop Air and AirAsia to establish businesses in Brunei.
It is noted that these companies are still in the early stages of establishment, but they, in my opinion, should be supported by the government together to help them move their applications to operate and successfully establish businesses in Brunei as soon as possible.
Kaola is aware that some issues about business establishment in Brunei are related to regional aviation certification issues regarding the products to be used by these companies made from China with the support of other ecosystems to help them operate in this region. However, considering Brunei as an ASEAN member which is a regional alliance, Brunei could modify its membership to assist this business not only in having business prospects in Brunei but also in other countries.
‘Small hands we outstretch’. We should be proud of this greatly significant opportunity to successfully establish businesses in Brunei.
As a government, they should be assisted in establishing in Brunei by resolving many regulatory issues at least at the ASEAN level so that these new operators can establish in Brunei and extend their wings to other countries in ASEAN.
Kaola's question, seeks clarification on the initiatives by the Ministry of Finance and Economy in assisting foreign entrepreneurs in establishing their businesses in this country as quickly as possible without compromising safety and credibility.
Thank you, Yang Berhormat Pengerusi. And peace be upon you.
Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II
Thank you, Yang Berhormat Pengerusi and thank you Yang Berhormat Hajah Rosmawatty binti Haji Abdul Momin for the questions asked earlier. First of all, regarding Brunei Halal which has been established since 2009.
If we look into the history of Brunei Halal, indeed since 2009, we have tried to advance branding. At that time, it was just a name but not yet a brand. So, the effort at that time, domestically there were no local products to be supported with Brunei Halal branding 'kitani', albeit a little with small volume.
So, at that time, Brunei Halal used 3rd party manufacturing so until there were these items not from local manufacture but from abroad but using Brunei Halal branding with standards and quality set by 'kitani'. If seen at that time, our 'kitani' products were also not much advanced because there were products made in Europe.
After that, sent back to Brunei to distribute with transportation cost and such, our goods compared to other products were not very price competitive. So, that was one of the reasons. Since 2015-2016, a new strategy for us to cooperate with local entrepreneurs.
At that time, we already saw an increase in local products produced by our MSMEs. But as we tried to help to make these products with local entrepreneurs, some MSMEs did not have enough capacity. The government continues to cooperate to further enlarge capacity so that we can produce products sufficient for export.
One example that has successfully obtained an award, namely our 'kitani' shrimp crackers that were promoted at that time in Dubai, winning an award. But that's the only one among a few products that show progress.
Elsewhere, when we collaborate with other MSMEs, the majority do not have the ambition to expand. What they have at the moment, they feel is sufficient and see no need to look for export markets and so forth. There are also MSMEs that are probably content with what is available domestically and do not wish to progress further. Hence, the quantity of 'kitani' products does not increase. Therefore, Brunei Halal has also considered what the scenario would be if utilizing 3rd party manufacturing, given the high cost and so on.
If we count on the location, the volume isn't much. The MSMEs that wish to collaborate aren't necessarily many. Hence, in the recent 2-3 years, Brunei Halal has established its own factory, namely Brunei Food Industry. With our own factory, hopefully, we can produce canned food, canned beef, canned chicken, canned seafood, and so forth.
This is to increase the volume of 'kitani' products that we can produce to meet export market demands. This is the current effort by Ghanim International Corporation Sdn Bhd, if there is progress, perhaps some of these MSMEs can be brought along to help each other enter the export market.
At the moment, the strategy does not seem to align with MSMEs. But we also help MSMEs go international, as recently in September last year, we participated in an expo in Sabah and it appears to be a success, we managed to export our food to Sabah and recently to Sarawak. And as kaola explained this morning at the MSME Festival recently, there were also some foreign importers who came to see our products.
In the name of Allah, the Most Gracious, the Most Merciful, these are 'kitani' efforts, there seems to be some progress. So, how will 'kitani' unify 'kitani' strategy? Hopefully, with the cooperation from MSMEs, there might be opportunities for them to progress into export markets and so on.
Regarding the third aspiration, globally and open connected economy, we must also think long term and not just at the present time. As a small state, perhaps some people wonder why 'kitani' wants an open and global connected economy and so forth.
For Negara Brunei Darussalam, with our ambition to diversify the economy, 'kitani' need to think long term to attract more FDI into the country so they can export. So, for us to export to other countries, we also must look to the global market that 'kitani' trade policy is up-to-date and modern.
Thus, our involvement in several FTAs such as RCEP, CPTPP, and recently IPEF in America, demonstrates to global partners, that 'kitani' trade policy, even though we do not yet have many industries to export and so forth but the reputation as a potential export trading partner, our policy is modern and up to date. If looked at, we already have results, in actuality, results are visible.
Our involvement in CPTPP, for the first time 'kitani' exported our fertilizer to Chile, if not mistaken in 2021. In 2022 and 2023, we continue to export for the first time to Peru and Mexico, countries 'kitani' have never exported any products before.
It appears that through these agreements we reach markets we have never exported to before. This we need to continue so that the global market sees 'kitani' as a reputable trading partner so that when FDI looks at investing in Brunei, it will benefit from the policy.
So, when it eventually establishes its factory in Brunei, its products can be exported like BFI which 'kitani' can export up to South America.
Lastly, regarding Gallop Air. Indeed, a proposal that 'kitani' need to seriously consider and think about. This is a rare proposition we come across. At the moment, the relevant parties are analyzing this proposal. However, considering there are still some considerations, maybe kaola cannot share here.
Let the parties involved review the proposal in depth again with some sensitive considerations as well before making a decision after that.
That is all kaola can answer to the questions from Yang Berhormat Dayang Hajah Rosmawatty binti Haji Abdul Mumin. Thank you, Yang Berhormat Pengerusi.
Yang Berhormat Pengerusi
In short, we are in the right direction.
Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II
In the name of Allah, the Most Gracious, the Most Merciful, Yang Berhormat Pengerusi. As a country that will diversify our economy, we cannot only rely on local SMEs to diversify the economy.
We indeed encourage our local businesses to expand. If possible, also to enter the manufacturing industry and so on but perhaps the magnitude isn’t enough for us to truly diversify 'kitani' economy.
So, we hope FDI also plays a role in diversifying the economy together with local businesses and so on. Like the recently established Anson International Marine Shipyard, which is a joint venture effort of FDI and so on.
'kitani' think long term, once FDI comes to this country to produce products and so on, where will they export, 'kitani' also help. At present, if we look at the free trade agreement, it’s not like the old days.
In the past, if FTA, it requests market access, lowering tariffs, not to be taxed, and so on. But modern FTAs with modern chapters involve workers right, whether using child labor, and so on. All these issues, hence become more important than market access and tariff.
This is why 'kitani' need to improve government policy so that any company establishing its factory and doing business in this country, 'kitani' have laws protecting workers rights and so on. It’s easier for us to export 'kitani' goods.
If 'kitani' do not, indeed people will buy and think they need to check again or FDI will need to do research again. If they know we are part of CPTPP, RCEP, IPEF, they already understand Brunei’s policy is indeed modern and up to date. They will do less research or less worry when they invest in Brunei.
Once they have their products, it’s easy for them to export to other countries. That’s one direction 'kitani' must always change according to the future direction of trade arrangement. Thank you.
Yang Berhormat Pengerusi
I invite Yang Berhormat Menteri Pengangkutan dan Infokomunikasi. Please.
Yang Berhormat Menteri Pengangkutan dan Infokomunikasi
Yang Berhormat Pengerusi. Kaola would like to touch a bit on what was asked by Yang Berhormat Dayang Hajah Rosmawatty binti Haji Abdul Mumin regarding the opportunity or about advancing the aviation industry.
In this connection, kaola would like to share that in terms of capability or capacity, the international airport is currently operating below capacity.
It can accommodate passenger movements up to 3 million a year, 100 aircraft movements and 50,000 cargo movements a year. At this stage, we are operating below that capacity.
Hence, advancing this industry can contribute and support efforts to diversify the economy and also opportunities identified along with the industry and business ecosystem of the Ministry of Finance and Economy is an opportunity in expanding cargo handling capacity, transshipment including high-value transshipment that has also been shared in developing cold chain logistics and sorting hubs.
Among the methods taken to advance these opportunities is by attracting investment from GLC's or external investors. With the view it is to compliment and to compete especially with local companies.
Touching on Gallop Air mentioned above, I would like to share that the process of evaluating the application is ongoing. What is being focused on at the moment is about the proposal for the type of aircraft they or type approval requested which at the moment follows the standards of the Civil Aviation Department.
'Kitani' refer to the standards of USFAA, Canada and European Aviation Standard. Meaning if the type approval of the aircraft requested meets those standards it will facilitate the process of approving their application.
But this is still in negotiation and I was also informed the company Gallop Air proposing the use of comet aircraft and also in the process of applying for European Aviation Standard approval.
That's all for now, Yang Berhormat Pengerusi to be shared at this time. Thank you.
Yang Berhormat Pengerusi
Thank you. Now I invite Yang Berhormat Dayang Hajah Safiah binti Sheikh Haji Abdul Salam.
Yang Berhormat Dayang Hajah Safiah binti Sheikh Haji Abd. Salam
Praise be to Allah, Lord of the Worlds, and prayers and peace be upon the noblest of prophets and messengers, our prophet Muhammad and upon all his family and companions.
Yang Berhormat Pengerusi and Your Honourable Members. Peace be upon you, mercy of Allah and His blessings and peace be upon you. Firstly, kaola would like to thank Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II for the presentation this morning regarding the planning and initiatives of the Ministry of Finance and Economy.
Kaola refers to the TAFIS 2.0 system which is hoped to improve the financial management system and delivery of government services to the people with an expenditure of $10.8 million under the Ministry of Finance and Economy’s Recurring Expenditure, which will be launched, God willing, on April 1, 2024.
Kaola acknowledges that this system was introduced starting in 2002 to facilitate the process of allowances and services payments.
All praise be to Allah with the transition of system from TAFIS 1.0 to TAFIS 2.0 Why do these local license holders rent out their licenses to foreigners. Have the reasons been identified?
Perhaps it is due to their lack of capital or the skills that we need to support and guide by concerned parties. Understanding these causes is crucial for us to help improve the economic status of the community.
What are the legal provisions imposed on parties found practicing this business?
Kaola believes it is necessary for relevant parties to examine and improve existing mechanisms to identify these Alibaba traders to not continue affecting local business opportunities, including checking the background of company owners applying for government tenders, strengthen enforcement through regular and continuous field inspections, expand local business awareness about their rights and opportunities including issues of integrity and incurred losses, as well as assisting and supporting them in addressing challenges preventing them from continuing their businesses.
Furthermore, collaborating with relevant stakeholders such as existing Business Councils in conducting inspections and launching awareness campaigns.
With that, thank you Yang Berhormat Pengerusi.
In the name of Allah, the Most Gracious, the Most Merciful. Seek help through patience and prayer, and indeed, it is a big thing except for the humble.
Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II
Thank you, Yang Berhormat Pengerusi. Thank you for the question from Yang Berhormat Dayang Hajah Safiah binti Sheikh Haji Abd. Salam.
The first question about TAFIS 2.0, to share with Yang Berhormat Dayang Hajah Safiah binti Sheikh Haji Abd. Salam, is that TAFIS 2.0 is an upgrading from TAFIS 1.0 to add new modules so that we are more efficient in monitoring expenditure, managing projects, and so on.
So, the question is about our investment in TAFIS 2.0, are there ways to address the issue of delayed payments to local companies?.
TAFIS 2.0 is not specifically to address delayed payments. Indeed, the issue of delayed payments is one I frequently hear complaints about from local businesses.
However, upon inspection of the reasons for delay, it's often that most invoices have not yet been submitted to the ministry for processing. They might still be in other ministries in the payment process.
Therefore, for those that have reached the Ministry of Finance and Economy, there are documents that are incomplete. Consequently, they must be returned to the concerned ministries to complete the necessary documents.
This often causes delays. Indeed, from the Ministry of Finance and Economy, every month we do remind each ministry about purchase orders and such to follow up on the status of each purchase order and so on so that they can expedite the process within each ministry.
That's the issue because we no longer require the documents to be sent physically to the Ministry of Finance and Economy. They can submit online and so forth.
So, this definitely speeds up the process. According to the Ministry of Finance and Economy's statistics, more than 80% are paid within the set TPOR. The rest are usually due to incomplete documents, hence needing to be returned to the concerned ministries for document submission.
Thus, بِنَا شَأنِ with this new system, hopefully, we can monitor this payment position more efficiently. Regarding local licenses leased to outsiders becoming 'Ali Baba', how can we assist our businesses?
Your question, indeed if they lend out to become 'Ali Baba', they will not inform the government that they are 'Ali Baba'.
So, how do we know who the real 'Ali Baba' is so that we can assist? So, if anyone faces challenges, they can meet with the relevant government authorities to think together about how we want to help. Not necessarily from a financial aspect, but skills and knowledge regarding the business involved.
The Ministry of Finance and Economy has taken steps to address this issue. If there are our people registering a company, we call its local partner so that we can better understand whether our people establishing this company truly understand the nature of the business and are knowledgeable in running it.
If he establishes a company but does not understand the business, then he might lend the license to someone else. When following the tender in other ministries later, that ministry also does not know whether it is 'Ali Baba' or not.
He attends meetings and so on. If he truly needs help, not just financially, he can approach the government whether under DARe, BEDB, and so forth to enhance skills or business operation and so on.
That's all the questions posed and my response that can be shared. Thank you, Yang Berhormat Pengerusi.
Yang Berhormat Pengerusi
I invite Yang Berhormat Awang Zainol bin Haji Mohamed.
Yang Berhormat Awang Zainol bin Haji Mohamed
Thank you, Yang Berhormat Pengerusi, in the name of Allah, the Most Gracious, the Most Merciful, peace be upon you, and His mercy and blessings.
Firstly, I would like to express my appreciation for the detailed presentation from Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II, including during the Supply Bill presentation previously.
I would like to highlight the issue concerning economic growth in our country. Specifically, encouraging local entrepreneurship and the measures that can be taken to empower local entrepreneurs and reduce the dominance of foreign entrepreneurs in the local business sector.
Firstly, I feel it is time for us to find ways and encourage local entrepreneurs to upscale small and medium businesses operating from home or on various platforms such as online selling into businesses that could generate more income for the local populace, especially retail businesses which are currently dominated by foreigners.
Several challenges faced by local entrepreneurs include quota requirements and finding supply chain networks.
In this scenario, foreign entrepreneurs with larger networks in terms of quota and supplies gain advantages. Moreover, they take the opportunity to use locals as 'sleeping partners' in their businesses.
In doing so, creating job opportunities for their own people. I would like to suggest for the government to facilitate local entrepreneurs by providing more supply networks and offering flexibility in granting worker quotas, especially as government and related agencies like DARe have access to movement and supply networks that could help local entrepreneurs connect directly to suppliers or distributors.
In addition, I would like to ask whether grants or financial schemes assisted by DARe to entrepreneurs, especially to start-up businesses, are truly effective in stimulating diverse economic growth. Given that market trends constantly change, our plans also need to adjust to these changes.
Flexibility in business is vital, and easing business procedures to encourage local entrepreneurs without overly strict restrictions such as providing blueprint plans and substantial financial guarantees should be considered so that local entrepreneurs do not feel hindered in entering this field.
Even though there are grants and financial schemes provided through relevant agencies, the processes can sometimes be difficult to undergo. Changing the original plan upon receiving the scheme is not allowed or requires a very solid basis for the change, which can lead to loss of interest and ultimately entrepreneurs not venturing into this field.
With this, kaola call for the ministry to help create an entrepreneur-friendly environment for the growth of local entrepreneurship by making access to capital easier. Generating connections to adequate supply and providing the necessary support to implement the business plan.
By doing so, we can encourage more local entrepreneurs to join the retail business sector which is still few and contribute to the development of our country's economy.
Thank you, Yang Berhormat Pengerusi.
Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II
Thank you, Yang Berhormat Pengerusi. Thank you, Yang Berhormat Awang Zainol bin Haji Mohamed regarding the issue of local business especially the convenience stores which at this time seem to be dominated by foreigners with their workforce also from foreign countries. Perhaps, kaola’s colleague can answer or explain this.
Enforcement and the like are indeed in place. One effort we must continue, among others, is to check and so forth. Convenience store owners often apply for quotas to obtain foreign workers. To address the issue of convenience stores being dominated by foreigners, Ghanim International Corporation Sdn. Bhd. has an initiative that was started a few years ago.
At that time, kaola shared with the public that this, it is not the first time we try this initiative will be guaranteed successful, but we must try and learn from it, and hopefully, we can improve. So this initiative is called The Junction.
The Junction, after opening several outlets with local businesses, we cooperate with some expenses borne by Ghanim International Corporation Sdn. Bhd., some run by local businesses themselves.
Thus, together we run these convenience stores so that we can employ local workers and so forth. There are indeed several challenges that we encountered. This is truly a lesson learned, from there we improve again.
Currently, Ghanim International Corporation Sdn. Bhd. is still continuing this initiative, taking into account expenses and failures so that we can improve.
So for entrepreneurs wishing to proceed on their own, not necessarily must work together with The Junction and so on. Indeed, DARE has a co-matching grant scheme that can support the business capital. Business capital that might be successful will be given a grant to support our local entrepreneurs.
In the name of Allah the Most Gracious, the Most Merciful, this issue has indeed been long outstanding for our government because using GLCs to collectively tackle this issue. So, we continue efforts under The Junction initiative, hopefully one day it will be successful and gradually we can hopefully take over, but at the same time, we might also need to investigate why convenience stores are dominated by foreign business people in this country. That's all, Yang Berhormat Pengerusi.
Yang Berhormat Pengerusi
I invite Yang Berhormat Menteri Hal Ehwal Dalam Negeri.
Yang Berhormat Menteri Hal Ehwal Dalam Negeri: Thank you, Yang Berhormat Pengerusi and colleague, Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II for the question regarding convenience stores.
As we have discussed during the allocation presentation for the Ministry of Home Affairs, kaola also announced every application for Foreign Worker License (LPA). Previously we called it a quota. This quota determines the allowed amount but now it is based on application.
If 10 is applied for, not necessarily 10 will be allowed, it is subject to the project and before the Foreign Worker License is allowed it really goes through certain processes such as cooperation with Job Centre Brunei.
Job Centre Brunei also identifies local youths who can work, for example as shop laborers, packers, supervisors, butchers, and so forth. However, before the LPA is allowed it indeed requires proof that the convenience stores, which are applicants for the LPA, are not run by those applying but by the owners of the license themselves, the locals.
So, if advertising processes have been made and there are still no locals, then foreign workers are allowed to come to fill the specified positions.
Depending on time, during the renewal of Foreign Worker License, it is practiced like that to ensure locals are also given the opportunity to work.
This is also our role as a Whole of Government and Whole of Nation just as kaola mentioned before we want each village to have its convenience store that is 100% run by our local. That's what we will implement. Not that we want to compete, but just to ensure what is raised is actually the case.
Why is the local license borrowed, used, and run by foreigners? It's because of us lending it. That’s all, Yang Berhormat Pengerusi.
Yang Berhormat Pengerusi
I invite Yang Berhormat Dr. Awang Haji Mahali bin Haji Momin.
Yang Berhormat Dr. Awang Haji Mahali bin Haji Momin
Thank you, Yang Berhormat Pengerusi.
In the name of Allah, the Most Gracious, the Most Merciful, Praise be to Allah, the Lord of the Worlds, and prayers and peace be upon the honor of prophets and messengers, our Master Muhammad and all his family and companions.
and peace be upon you. Thank you, Yang Berhormat Dato Seri Setia Dr. Awang Haji Mohd. Amin Liew bin Abdullah, Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II for the introduction and congratulations on the initiatives and efforts that have been carried out.
Kaola would like to express views and questions regarding the industry related to the halal industry which in kaola's opinion has great potential to be expanded in the regional and international markets.
This industry has also been ventured into by the ministry to further expand our country's and overseas industry.
However, at this time, the modernization that is hoped for has not reached the level as expected. If its impact is achieved as expected, it would surely improve the Gross Domestic Product and subsequently reduce unemployment in this country.
The industry kaola is referring to is the halal industry such as pharmaceutical, Islamic banking, and takaful, where some of these industries have already grown rapidly in our country and other countries.
However, for some products that still lack visibility in terms of exporting to other countries, it is not comprehensive, especially for industries that have advanced especially Islamic banking and takaful.
Kaola is aware of the grant for capital agreement to develop a Shariah-compliant Digital Finance and Economic Zone, the first in this region, especially in the BIMP-EAGA area. However, there has been no news about it since it was announced by the related parties in 2021.
Regarding the pharmaceutical industry, according to forecasts made in 2021, the halal pharmaceutical industry market is expected to reach USD$105 billion this year, 2024. In addition, the value of the global pharmaceutical market will exceed USD$1 trillion.
Regarding the halal pharmaceutical industry, perhaps the public is not aware of the existence of Simpor Pharma, which has been said to be the main leader in the halal pharmaceutical industry in this country. Simpor Pharma, a $26 million joint venture with a foreign company, developed in the Salambigar Industrial Area and allocated more than two acres.
The company produces medication under its brand, but in kaola's opinion, the progress of this company needs to be enhanced and sustained.
So, what are the current efforts to develop and enhance these high-potential enterprises. Asking for enlightenment and explanation from Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II. What is the current narrative about the Shariah-compliant Digital Finance and Economic Zone initiative and what is the direction of the ministry to also empower the economy and halal pharmaceutical industry in this country and also abroad.
Kaola would like to suggest for the country's financial industry like Bank Islam and Takaful Company to also expand its wings regionally to increase its asset value and increase revenue for the country.
This shows that the ministry’s previous initiatives in the mentioned industry should be pursued more aggressively by taking more proactive steps to achieve and continue the ministry's vision.
That is all, Yang Berhormat Pengerusi. May Allah bless you, peace, mercy, and blessings of Allah be upon you.
Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II
Thank you, Yang Berhormat Pengerusi and thank you, Yang Berhormat Dr. Awang Haji Mahali bin Haji Momin.
There might be two questions, one concerning the halal industry for takaful and banks. The second about the Digital Syariah Finance Zone and perhaps the third about pharmaceuticals.
Firstly, regarding why we do not develop our takaful industry abroad, exporting our products. We need to understand that compared to our banks in Negara Brunei Darussalam, even though we see Bank Islam Brunei Darussalam (BIBD) as the largest, when compared with banks abroad, it is still small.
If we want to expand internationally, we must find a niche strategy. This niche strategy might be takaful or other types of Islamic products. So before we dive in, we need to conduct a study. For example, in Thailand, there was the Islamic Bank of Thailand.
In the past few years, this bank failed and was not successful. Singapore had an Islamic Bank supported by the government, which has been closed in the recent past years.
So we also need to understand, to make a real study before we venture abroad, and before that, I think let's not take this high risk given that there are already several examples that have not yet appeared successful.
Indeed, there is an intention like Bank Islam Brunei Darussalam (BIBD) to expand internationally. At this time, there is indeed an office in Singapore, there is also an office in Dubai. This is somewhat the first step for us to better understand the market in each country before directly opening branches and so on.
So this is a less risky approach for us to try and study the market. When the time comes, and we feel confident to succeed, only then we will invest in larger amounts and take potentially higher risks.
Regarding the Digital Syariah Finance Zone, kaola is not too knowledgeable about the Digital Syariah Finance Zone within BIMP-EAGA. Maybe when kaola can do some research, kaola will answer in writing, إن شاء اللّٰه. Regarding pharmaceuticals, there is Simpor Pharma in Negara Brunei Darussalam currently. It has indeed been established for more than 10 years with several operational challenges and so on.
To establish a pharmaceutical company indeed has its own challenges. At this time, the government is still contemplating negotiations with some technical partners to further develop this industry. That is all kaola can share. Thank you, Yang Berhormat Pengerusi.
Yang Berhormat Pengerusi
I invite Yang Berhormat Chong Chin Yee.
Yang Berhormat Dayang Chong Chin Yee
Thank you, Yang Berhormat Pengerusi. Yang Berhormat Pengerusi and Your Honourable Members.
Kaola appreciates all initiatives and actions by the Ministry of Finance and Economy in achieving goals as well as the development and progress of the nation's economy.
Kaola's first question is about the infrastructure of Digital Payment in economic development. With the ASEAN Digital Economy expected to reach nearly US$1 trillion by 2030, the importance of digital payments is clear and significant to highlight.
Referring to the 18th Meeting of the National Legislative Council, Yang Berhormat Menteri stated that Digital Payment Hub could reduce cash transactions to the government by 90%, which could save a large amount up to millions of dollars a year.
However, kaola believes that achieving a significant reduction in cash transactions undoubtedly requires widespread and comprehensive digital use across all levels of government operations.
Kaola's first question is what steps the government is currently implementing to ensure a high rate of digital use in achieving the stated goal of reducing 90% in cash transactions.
Kaola appreciates all initiatives and actions by the Ministry of Finance and Economy in achieving goals as well as the development and progress of the nation's economy.
Kaola's first question is about the infrastructure of Digital Payment in economic development. With the ASEAN Digital Economy expected to reach nearly US$1 trillion by 2030, the importance of digital payments is clear and significant to highlight.
Referring to the 18th Meeting of the National Legislative Council, Yang Berhormat Menteri stated that Digital Payment Hub could reduce cash transactions to the government by 90%, which could save a large amount up to millions of dollars a year.
However, kaola believes that achieving a significant reduction in cash transactions undoubtedly requires widespread and comprehensive digital use across all levels of government operations.
Kaola's first question is what steps the government is currently implementing to ensure a high rate of digital use in achieving the stated goal of reducing 90% in cash transactions.
Given the anticipation of the National Digital Payment System launch, a significant step towards increasing inter-trade among micro, small, and medium enterprises with other ASEAN countries. Kaola wants to understand the current scale of our digital economy and the Ministry's developments to enhance the nation's digital economy in the future.
Furthermore, will the ministry consider mandating the use of QR Interoperability for all shops including petrol stations to ensure a seamless and integrated digital payment ecosystem.
How will such enforcement support the country's micro, small, and medium enterprises and the broader economic landscape.
Kaola's second question is about the cybersecurity of digital payments.
With the development of digital payment platforms, the increase of cybersecurity threats such as push payment fraud, peer to peer fraud, and exploitation of mule accounts will pose apparent and clear risks to users. Those involved in fraud and scammers are undoubtedly quick in overcoming new technologies and often exploit social engineering, and they commonly target users who are less skilled and prepared for technological advancements.
These issues could reduce user-confidence in online payment systems and indirectly affect the plans and success of the Digital Payment Hub.
Kaola's questions are:-
- With the sophistication of online scams on the rise, what steps and strategies are implemented by the ministry to enhance and strengthen digital usage security?;
- In addition, how does the ministry plan to ensure financial institutions are held accountable to prevent fraud, especially involving mule accounts?
Lastly, about enhancing market intelligence to develop local businesses.
Kaola would like to congratulate the Brunei Economic Development Board, Darussalam Enterprise, and other related agencies for their remarkable achievements last year.
These achievements include Brunei's Inaugural Startup Summit, The Initial Innovation Challenge, main shipment of local products to Mustafa Center, Singapore, the first commercial-scale export of processed food and beverage products to East Malaysia, the launch of the first cooking oil, and other achievements.
The primary role of the Ministry of Finance and Economy in providing market intelligence is crucial for local businesses in considering regional or international expansions. Market intelligence is important for local businesses aiming for or has the potential for expansion outside the country borders since it involves the collection, analysis, and interpretation of market size, trends, development potentials, and competitive landscape.
Kaola's question is:-
How does the ministry collaborate with other agencies to enhance market intelligence for businesses in Brunei and ensure they are knowledgeable about the market potential for their businesses.
Given the concerns about the reliability of Brunei's data, especially in foreign publications, are there plans to produce and distribute our data more effectively and securely?
Furthermore, can the ministry facilitate the publication of infographics and reports that are understandable and absorbable and encourage contributions from local economists and statisticians to this country's media?
In addition, does the ministry have initiatives to collaborate with trustworthy social media content creators to disseminate and enrich this information?
Kaola believes these steps will enhance the international defense of local traders regarding Brunei's economic potential and support the development and growth of our local enterprises.
That is all from kaola, thank you Yang Berhormat Pengerusi.
Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II
Thank you Yang Berhormat Dayang Chong Chin Yee. There are several questions, especially about digital payments, how 'we' encourage more transactions through digital payments.
Indeed, to support this effort, several infrastructures must be provided, not just relying on 'kitani' to proceed towards digital payment, 'kitani' must ensure our connectivity as implemented by UNN where connectivity throughout the country is reliable, and secondly, cybersecurity must be maintained before 'kitani' implement digital payment and others, possibly including data centers and so forth.
Therefore, اَلتَّكْرَارُ, several efforts have been carried out by the government and the time has come for 'kitani' to introduce digital payment. This digital payment has several benefits; it will reduce payment fees and so on. Currently, if 'kitani' use a debit card or credit card, there are indeed charges at the store must pay charges and so forth.
So with Digital Payment, charges will decrease اِنْ شَاءَ ٱللَّٰهُ, it will benefit not only the public but also companies, businesses. Hence, digital payment has its advantages for 'kitani' to address together the issue of anti-money laundering. This is one of the advantages of digital payment.
Digital payment is a proposal from the Asian Business Advisory Council. If 'kitani' look at neighboring states, such as the Republic of Singapore, they have had an e-payment gateway within the country for a long time. So, with their e-payment gateway, they can collaborate with Thailand with Thailand's own payment gateway. Currently, the Republic of Singapore has an agreement with 4-5 states in ASEAN. So, a proposal from the Asian Business Advisory Council, it is necessary for every ASEAN state to have its own digital payment gateway.
So, 'kitani' can link up, work together with the other nine ASEAN states, hence there truly is connectivity. When 'kitani' go abroad later, 'kitani' use this payment gateway card just like when 'kitani' are in the country, it can be used in ASEAN states. This promotes intra-trade within the ASEAN community. So it reduces costs, for example, currency exchange can 'kitani' know before 'kitani' pay. This is one of the government's efforts that has started to implement this e-payment gateway for several years now.
بِسْمِ اللهِ الرَّحْمٰنِ الرَّحِيْمِ eventually at the beginning of next year, بِسْمِ اللهِ الرَّحْمٰنِ الرَّحِيْمِ it will be launched. Currently, several local banks are collaborating with 'kitani' to provide this e-payment gateway.
Kaola believes, if e-payment gateway is launched later, the response from the public will indeed increase. As 'kitani' have seen in the recent MSME Festival at Bridex, with 180 businesses participating, all were provided with QR codes and so on for online payments and so forth. This is one way for 'kitani' to further enhance the use of digital payment. Indeed, this is considered a new trend, which kaola believe will encourage a positive response.
Next, regarding the use of QR interoperability like in gas stations and so forth. This matter has already been discussed with Brunei Shell Marketing (BSM) in terms of whether 'kitani' can pay without needing to use cash, using mobile and so forth.
So there is indeed a concern because currently, at gas stations, 'kitani' cannot use mobile phones because of the signal and so forth. So, this is one issue that slows 'kitani' down in using QR codes at gas stations and so forth. But QR codes in the business community are already widely used at this time.
Regarding online scams, indeed it is an issue not only occurring in Negara Brunei Darussalam, but in other states, many cases of this exist. So, several banks in Brunei have taken their own steps to ensure that when 'kitani' pay, to know whose account 'kitani' will pay on behalf of who and so forth so that 'kitani' can double-check if the account 'kitani' pay to is owned by the person 'kitani' will pay.
This is one way for 'kitani' to ensure that when 'kitani' make payments, it is known who actually receives the payment, whether possibly a scam and so forth. That's one step several banks have introduced as shared earlier.
There's also an addition in limits to some devices. Some account holders give their password to family members. So, these family members sometimes use their computers to log in and so forth to make payments without his knowledge.
So, some banks have limited the use of the device to one laptop and one mobile. So if he lends the password to other family members, they cannot make transactions. This is another step to tackle this issue.
Next, market intelligence. Currently, Darussalam Enterprise (DARe) indeed has appointed a company to conduct surveys and so forth in terms of our business community and so forth. So, the Brunei Darussalam Central Bank (BDCB) has also conducted research and so forth.
Currently, it's not centralized so it appears that now 'kitani' local products have started to export and so forth. This is good information if 'kitani' can share with the local business community so that they see there are companies that have been able to export, utilize export opportunities and so forth. Perhaps they're more encouraged to follow as well. So if market intelligence can be shared with the business community, it truly is a positive step. So currently, this information is not centralized. Kaola welcomes this suggestion whether it is later considered which agency can take over this task to make a regular market intelligence report.
Regarding the reliability of Brunei's data. Kaola would like to share this on behalf of the Department of Economic Planning and Statistics (JPES). Currently, the statistics issued by JPES follow international standards recommended in the guideline books set by international bodies such as the International Monetary Fund (IMF), United Nations Statistics Division, International Labour Office, and so forth.
So, indeed, what is issued is of quality and reliable. Moreover, Negara Brunei Darussalam as a member of the ASEAN Community Statistical System. So, this as a platform ensures ASEAN members meet the standard in producing, distributing, and communicating effective statistics.
So for the public, any interested parties can use the published material in a responsible manner to spread knowledge or for their own research. So, for the public to better understand what is shared with them regarding research data and so forth, إِنْ شَاءَ ٱللَّٰهُ, indeed we will do it in a user-friendly manner, easy to understand such as the infographic provided to increase layman's understanding and reports have already been issued through website, Instagram, and media releases.
That's all maybe kaola can share. Thank you, Yang Berhormat Pengerusi.
Yang Berhormat Pengerusi
Thank you, Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II. I now invite Yang Berhormat Pehin Orang Kaya Indera Pahlawan Dato Seri Setia Haji Awang Suyoi bin Haji Osman.
Yang Berhormat Pehin Orang Kaya Indera Pahlawan Dato Seri Setia Haji Awang Suyoi bin Haji Osman
Thank you, Yang Berhormat Pengerusi.
أَحْمَدُ ٱللَّٰهَ عَزَّ وَجَلَّ وَأَشْكُرُهُ تَعَالَى عَلَى نِعْمَائِهِ وَأَسْأَلُهُ تَعَالَى أَن يُعِينَنِىْ وَيَعْفُوَ عَنِّىْ وَيَغْفِرَ لِىْ وَيَتُوبَ
أَسْأَلُمُ ٱلْعَافِيَةَ وَٱلْغِنَى وَٱلْإِسْتِغْنَاءَ وَأَسْأَلُهُ تَعَالَى وَأَدْعُوَهُ أَحْمَدُ
أُسْكُنٌ اِسْمَعِيلُمُ عَائْشَمُنُ فَرْحَةَ ٱللَّٰهِ وَبَرَكَتِهُ and greetings of peace. First and foremost, kaola would like to express my sincere gratitude to Yang Berhormat Dato Seri Setia Dr. Awang Haji Mohd. Amin Liew bin Abdullah, Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II for the detailed presentation of the allocation.
Kaola will not comment on the budget presentation of the Ministry of Finance and Economy which was delivered elegantly and in detail, and kaola would like to express my sincere thanks and congratulations to Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II for being able to provide an allocation to ensure the government machinery continues alongside an allocation of $4 billion under RKN-12 for the purpose of progress. الخجلة
Kaola hopes that the allocations approved can spur the economic growth we anticipate and support sectors that can bring significant growth to the economy through activity enhancement, including new infrastructure projects that will have a large impact on the development and overall economic growth.
Yang Berhormat Pengerusi, as has been raised in this congress, we have identified three main industries that in kaola's opinion need support:
- Construction industry including housing, government and commercial buildings, highways, bridges, etc.;
- Agriculture, fisheries and the agri-food industry.; and
- Tourism industry which has the potential to generate many jobs, food industry, transportation, accommodations, hotels, etc.
Kaola would like to inquire whether there's room to reassess the addition of allocations if truly needed because in the discussions a few days ago, it was found that the allocations are insufficient. So if there is room, if needed to consider the provision of additional allocations.
Many local entrepreneurs have ventured into these fields. The future of their companies or enterprises depends on how much the government continues to support these industries as key sectors. Kaola asks how often does the Ministry of Finance and Economy go down to feel the pulse of our business community regarding the industries kaola mentioned?
In the introduction by Yang Berhormat Menteri, one of the budget management goals is to enhance the country's economic diversity through the oil and gas supply industry by creating a conducive trade environment. There's a concern of a mismatch between the reality of the allocations allowed and the expectations especially for those involved with the current economic situation including government ministries and agencies expecting reasonable allocations to enable them to carry out their strategic planning for the years 2024/2025 and also under RKN-12. Some entrepreneurs have mentioned that the current allocations will not significantly change the situation on the ground.
Additionally, Yang Berhormat Pengerusi, kaola also believes our economic growth not only needs financial injections into the economy but also to scrutinize any laws and regulations that are not business-friendly, to be reviewed or suspended temporarily to provide a more conducive and supportive business environment. In the uncertain economic climate, our companies need a lifebuoy to save them and less regulation or laws only complicating matters.
That concludes Yang Berhormat Pengerusi's views from 'abiskaola'.
وبالله التوفيق والهداية، والسلام عليكم ورحمة الله وبركاته
Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II
Thank you, Yang Berhormat Pengerusi. Thank you, Yang Berhormat Pehin Orang Kaya Indera Pahlawan Dato Seri Setia Haji Awang Suyoi bin Haji Osman for the questions regarding the government's spending to support several key industries for our country.
To answer this, kaola will share some background. If we look at the allocations provided by the government, let's take the figure for the year 2018/2019 as an example, up to now our proposed budget of $6.25 billion has already increased by $1 billion.
So the question might not only be about financial injections to support industries, perhaps there are policies that we need to review to collectively support these important industries. Indeed, for RKN-12, we have prepared a Macro-Economic Cluster Development allocation.
Therefore, an allocation has been made available. Not yet earmarked for any specific project. If there's a need to support our macroeconomic development, this allocation can be used. So, there's a chance for us not necessarily tied within the $4 billion. There's a part of the allocation provided for us to consider if there is a need, we don't have to wait until RKN-13 to develop any identified clusters.
Kaola also want to share that in these areas, not only is the expenditure expected from the government. As explained in the economic blueprint, it also involves GLC's, involves FDI, and so on. If we look at it now, we're going to further expand the Muara Port, adding another terminal, spending hundreds of millions, this does not use government allocation, this uses joint venture GLCs with FDI to get funding to expand the terminal, etc.
So, for tourism, there's one project being planned in the Temburong District that does not use government allocations. This is considered private investment. So that's our economic blueprint, not only relying on government allocation, but wherever there's a chance we use private capital. We'll make sure this private capital is used commercially, so it can be sustainable. Not to find one day in the future relying on the government for support again.
In terms of agriculture, it has been an effort from the past by the government to assist this field with subsidies, by bank, etc. These three kaola feel have already got sources of funding to support these three industries. However, we must think because some part of the business problem, as explained by Yang Berhormat Yang Berhormat Pehin Orang Kaya Indera Pahlawan Dato Seri Setia Haji Awang Suyoi bin Haji Osman earlier, is not necessarily about finance.
Maybe some of the government policies need to be reviewed, changed to support our economy. So, as kaola suggested this morning too if possible kaola want to meet with these traders so to better understand what exactly their issues are because kaola explained the other day, sometimes the economic structure will change from one time to another. So, the previous business model may not be viable anymore. Therefore, it's necessary for us to change, change with time. The business model needs to be changed too. So if there is anyone having this business feeling their business needs to change, kaola really encourages them to continue to invest in this country, maybe not in the business they have now maybe in other opportunities like manufacturing industries, etc. Maybe they can expand and divert into other industries.
بِسْمِ ٱللّٰهِ it is hoped there will be an opportunity to meet with business entrepreneurs as mentioned by the Honourable Member. Maybe it can be arranged for us to meet together. Like what kaola always do, meet with the National Chamber of Commerce, Brunei Economy Roundtable Discussion, and so on. This as an additional grouping that may be beneficial and assist the Ministry of Finance and Economy in its duties. Thank you, Yang Berhormat Pengerusi.
Yang Berhormat Pengerusi
Thank you, Yang Berhormat Menteri di Jabatan Perdana Menteri and Ministry of Finance and Economy.
I understand that Yang Berhormat Menteri Pengangkutan dan Infokomunikasi wishes to make an intervention, additional explanation regarding the question raised by Yang Berhormat Dayang Chong Chin Yee. Please go ahead.
Yang Berhormat Menteri Pengangkutan dan Infokomunikasi
Thank you, Yang Berhormat Pengerusi. Indeed, kaola would like to add a bit from what was shared by Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II regarding the issue of cyber security.
Kaola would like to share that a safe and secure cyber ecosystem is one of the key enablers in expanding the use of online methods for business transactions or payment methods. In this relation, it is also shared that the 3 main pillars of cyber security are people, process, and technology. Hence, the measures and strategies implemented are directed towards these 3 main pillars.
At the same time, it cannot be denied that the issue of online fraud is worrying, and based on the report gathered by the Royal Brunei Police Force and BruCERT (Brunei Computer Emergency Response Team), most of the top 5 modus operandi at this time involve social re-engineering tactics, be it through online buying and selling, investment scams, WhatsApp impersonation, loan scheme scams, and also scams offering loan schemes.
In this regard, while increasing public awareness and knowledge in terms of preventing fraud by this social engineering modus operandi, various public security measures that cover various layers of society whether senior citizens, school children, and alike are ongoing and in progress. At the same time, it is also shared that the cyber security order which has recently received consent and was gazetted in 2023.
Currently, in the process of 'operationalizing' the requirements to system owners categorized as critical information infrastructure or critical information infrastructure. This legislation will require all institutions owning critical information infrastructure which also includes financial institutions like banks.
They are required to ensure and implement measures to prevent their systems from being easily breached. At the same time, it is also acknowledged in the issue of dealing with online scams, it requires different actions from traditional crimes which also necessitate smart actions.
In this regard, it is shared that a taskforce has been established to address the crime of fraud and scamming under the National Security Committee, chaired by the Director of the Criminal Investigation Department Royal Brunei Police Force and its members consist of the Attorney General's Chambers, officers of the Royal Brunei Police Force Crime Department, Internal Security Department, the Authority for Info-communication Technology Industry (AITI), and also ad hoc members consisting of Cyber Security Brunei, UNN, and also the Brunei Darussalam Bank Association. These are among the steps being implemented to address the public's difficulty or concerns regarding this scam issue.
Additionally, AITI has also currently implemented actions to block known numbers and short message scheme scams used, and also block websites known and used or included in the link to the short messages system. These, Yang Berhormat Pengerusi, are the steps being implemented by the government in addressing the issue of online scams. Thank you.
Yang Berhormat Pengerusi
Thank you, Yang Berhormat Menteri Pengangkutan dan Infokomunikasi, for the additional explanation that has just been presented.
Now I invite Yang Berhormat Pehin Orang Kaya Johan Pahlawan Dato Seri Setia Awang Haji Adanan bin Begawan Pehin Siraja Khatib Dato Seri Setia Haji Md. Yusof.
Yang Berhormat Pehin Orang Kaya Johan Pahlawan Dato Seri Setia Awang Haji Adanan bin Begawan Pehin Siraja Khatib Dato Seri Setia Haji Md. Yusof
In the name of God, the Most Gracious, the Most Merciful. I praise Him and thank him as He deserves, and I bear witness there is no god but Allah, Alone without partners, and I bear witness that Muhammad is His servant and messenger.
Yang Berhormat Pengerusi and Your Honourable Members. First of all, kaola would like to express the highest appreciation and thank you to Yang Berhormat Pengerusi for the opportunity given to kaola to jointly debate the Ministry of Finance and Economy's Budget for the Fiscal Year 2024/2025.
Kaola would also like to congratulate and thank Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II for the comprehensive keynote that outlines, among other things, the directives and action plans that have been and will be implemented towards achieving this ministry's vision, which is a progressive fiscal and economy towards a prosperous nation.
Additionally, various strategies and initiatives that have been successfully implemented will continue to generate a more sustainable economic growth solely for the welfare and wellbeing of the citizens and residents in this country.
Yang Berhormat Pengerusi and Your Honourable Members. In particular, kaola would like to address the issue concerning Micro, Small, and Medium Enterprises (MSMEs). Kaola would like to draw the attention of this honorable Council to Micro, Small, and Medium Enterprises.
Referring to the statistics and report of the Annual Census of Enterprises (ACE) 2023, playing a crucial role as a driver of the national economy, comprising approximately 97.6% or 6,411 enterprises out of 6,570 total businesses in this country. While the rest are 159 or 3% categorized as enterprises in large scale business.
In this case, it is understood that MSMEs are also significant contributors to job opportunities, comprising 60% of employment in private sectors and 40% of the country's GDP, proving their importance in generating economic sustainability. If we look at the statistics from 2021 to 2022, Micro, Small, and Medium Enterprises have increased by 3.4%.
While data has shown an increase in the proportion of enterprises from 42.4% to 43.1%. The proportion of medium enterprises also increased from 846 enterprises in 2021 to 928 enterprises in 2022. This proportion, for medium enterprises, is at a rate of 14.1% of the total business types. However, from the indicators of the Annual Census of Enterprises (ACE), this showed an increase in micro and small enterprises in 2021 and 2022. Yet, small and large enterprises have experienced a decline. Small enterprises decreased by 0.3%, from 2,661 enterprises in 2021 to 2,652 enterprises in 2022.
For large enterprises, there has also been a decrease in percentage from 5.4% from 2021 to 2022. What we can see, from kaola's own perspective, is the challenge to encourage and further increase more entrepreneurs whether in small, medium, or even large scale that experience a decline instead of an increase.
Looking at the income trend of companies or private enterprises, what is understood has shown an increasing trend since 2017. The most significant increase was from 2021 to 2022 from 31.9 million to 40.8 million. This increase is encouraging. What is hoped, so that this increasing momentum will continue to be enhanced over time, God willing.
Realizing the role of the private sector as one of the engines of growth in the economic aspect and through government agencies acting as key pillars serving as facilitators and creating a conducive and friendlier business environment, i.e., a better ecosystem, kaola would like to request insights on what strategies or initiatives in encouraging and further promoting entrepreneurs to the level of reaching large scale businesses and further having the potential to penetrate foreign exports.
Secondly, kaola would like to touch on fiscal policy. As it is known, the vision of the Ministry of Finance and Economy is "Progressive fiscal and economy towards a prosperous nation". Meanwhile, three out of four aspirations of the Ministry of Finance and Economy's strategic plan for 2021-2025.
The first is economic development and diversification. Second, promoting fiscal sustainability through efficient public finance use. Third is effective engagement and cooperation among stakeholders.
At the same time, among the challenges kaola sees here is, as we all know, the country's fiscal balance has experienced a deficit for several years. For example, for the Fiscal Year 2024 to 2025, it is projected at 2.99 billion.
Secondly, the procedures to balance and strengthen the country's fiscal stability, and more importantly, how does the country control or mitigate all risks and negative impacts now and in the future, even in the long term? In other words, we do not want to burden the economy on future generations.
As we collectively move forward facing an unstable socio-economic situation and slow economic growth, alongside economic activities that have not been very prominent, including aggressively encouraging Foreign Direct Investment (FDI). Thus, it would be delightful to receive enlightenment from Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II on what strategies or initiatives to strengthen and solidify the country's fiscal position more directed and to ensure a more sustainable and resilient financial position?
Here kaola believes a very important role to be more earnest and aggressive requiring alignment and harmonization of government policies, especially as facilitators in achieving more sustainable and sustainable national economic growth targets until reaching the aspirations or Wawasan Brunei 2035.
Thirdly, kaola would like to address the issue concerning cooperative enterprises. Cooperatives can be interpreted as an autonomous association of people united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly owned and democratically controlled enterprise according to enforced cooperative regulations.
The cooperative model, as practiced in many regional countries, is based on principles that transcend profits, capable of generating significant impacts on the development of a local community and even encompassing the socio-economic of a country.
However, it requires transformation or innovation in cooperative development according to current and future developments. According to the International Cooperative Alliance World 2022 article, at the global level, strong cooperative enterprises are a sector capable of contributing to more sustainable economic growth where their earnings amount to USD$2 trillion contributed by approximately 3 million cooperatives and 1 billion members.
A majority of the world's best cooperatives, based in Europe, account for 24% out of 300 cooperatives, with most of these cooperatives headquartered in France, Germany, and the Netherlands. This has proven how crucial it is to pay attention to the cooperative sector and that it needs to be transformed according to best practices, serving as an example and model for the benefits of expanding, developing, and activating the cooperative sector in this country.
In relation to this, regarding the position of the cooperative sector in this country, kaola request enlightenment from Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II on the following matters:
What is the status of the development and activity of the cooperative sector in this country?
How many cooperative enterprises are registered, including their members, have increased or otherwise?
From what kaola personally notices, the performance of the cooperative sector in contributing to the socio-economy of its members and the cooperative enterprises themselves has not been encouraging in this country. Therefore, what are the main reasons many cooperative enterprises are not very active and developed, and even not increasing in number? What strategies or initiatives are planned to advance the cooperative sector as a catalyst for local socio-economic growth in particular and the country in general?
Furthermore, Yang Berhormat Pengerusi and Your Honourable Members, what kaola would like to address here is in the book under the Ministry of Finance and Economy title regarding the indicator toward participation in regional and international expos and trade shows. It appears in the Budget Book that there were only 3 exhibitions or expo participations in 2021/2022, whereas from 2022/2023 to 2024/2025, there are only 2 participations in exhibitions and expos. Completing this, what kaola can observe here, as recently conducted by the Economic Development Board, was hosting Invest In Brunei in Australia during the ASEAN Special Summit Market Place, showcasing a conducive and friendly business ecosystem. This is a way to provide actual information on how "kitani" attracts investors and also how these expos can promote to bring in tourists and export local products.
What kaola would like to get enlightenment from Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II, is whether there are initiatives to capture strategies for more country participations in exhibitions or expos in "kitani's" joint effort to attract more foreign investors as well as, as mentioned earlier, to draw in more tourists and any local products that "kitani" can promote for export.
Furthermore, kaola would like to raise under the Treasury Department title concerning the percentage of reducing collection arrears for the government sector. From what kaola understands, in the Fiscal Year 2021/2022, it amounted to 7% - $31.71 million in arrears.
From the target indicators to reduce arrears for 2022/2023 - 2.7%. While it decreases to 2.0% in 2023/2024. Kaola is still reviewing here to request enlightenment from Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II, why are our targets decreasing instead of aiming to increase collection to generate more revenue from these arrears.
As "kitani" are well aware, in the Fiscal Year 2024/2025, "kitani" are expected to face a deficit of $2.99 billion. From this perspective, kaola believes that the country's deficit situation is something "kitani" should think about together, not just a burden on the Ministry of Finance and Economy, but also other ministries and government agencies should not only consider obtaining allocations but we collectively unite on how "kitani" might reduce the deficit by at least thinking of introducing a system that could generate additional revenue for the government of Kebawah Duli Yang Maha Mulia Paduka Seri Baginda Sultan dan Yang Di-Pertuan Negara Brunei Darussalam.
Undoubtedly, if we introduce a system to impose charges or reissue licenses to traders, we should also think so that it does not burden those with low incomes.
Thus, 'perhaps' what kaola can raise here. Kaola once again would like to express great thanks to Yang Berhormat Pengerusi and Your Honourable Members, kaola concludes with بِسْمِ اللهِ الرَّحْمٰنِ الرَّحِيْمِ اللَّهُمَّ صَلِّ وَسَلِّمْ وَبَارِكْ عَلَى سَيِّدِنَا مُحَمَّدٍ
Yang Berhormat Menteri di Jabatan Perdana Menteri dan Menteri Kewangan dan Ekonomi II
Thank you, Yang Berhormat Pengerusi and thank you to Yang Berhormat Pehin Orang Kaya Johan Pahlawan Dato Seri Setia Awang Haji Adanan bin Begawan Pehin Siraja Khatib Dato Seri Setia Haji Md. Yusof, for the several questions raised earlier. Firstly, about MSMEs where it was shared that large and small enterprises have decreased, while micro and medium have increased. For the Ministry or for the Government no matter if they are small, micro, large or medium, "kitani" will continue to help and provide assistance.
Several programs have been provided by Darussalam Enterprise and also support such as co-matching and business helpdesk, etc. So, regardless of who or what size they are, indeed part of "kitani’s" MSMEs will continue to grow into large scale businesses. Thus, to further develop "kitani's" MSMEs so that they become a large enterprise, "kitani" must look at our market, if we consider the domestic market with a population of 450 thousand people from year to year also about the same, to grow further it is either they grow by taking pie from others or they must look into the export market.
This is indeed what kaola share, we continuously encourage "kitani's" enterprises to look into the export market and not just rely on the domestic market given that the population or demand of 450 thousand people will remain the same. If they grow, maybe they take pie from another local company. This is not how we develop "kitani's" enterprises; we need to look into the export market, etc. This is one issue when meeting with local traders and maybe can share how to get a business model they need to look beyond the current operation.
The second question about fiscal policy, indeed since 10 years ago, "kitani" have started to experience a fiscal deficit. This is indeed not sustainable, we must think together how to address this issue from encouraging excessive spending, etc., that may achieve reducing the deficit but not necessarily the only solution.
The Ministry of Finance and Economy indeed, for several years now, has been implementing a fiscal consolidation programme encouraging where can we through methods like PPP, corporatization, etc. These are the issues that "kitani" continue to address so that "kitani" can reduce "kitani's" deficit.
So, to maintain sustainability, thinking of the future generation, what spending at present must produce positive outcomes for the future. As kaola have shared before, investing in our future so "kitani’s" expenses hopefully in the future will reduce allocations from the government. This is "kitani’s" strategy at present. Another thing kaola wants to share because of fiscal policy in Brunei Darussalam is different from other states even though "kitani’s" economy is advancing, even though GDP 'kitani' continues to increase, it does not necessarily guarantee the government's fiscal position will improve (improved) because 'kitani' punya fiscal policy especially tax is different from other states.
For other states, as the economy advances, many people working, and receiving income tax, corporate tax, property tax, sales tax, tourist tax, etc. For 'kitani', even though tourists increase, even though many people buy houses, etc., the income does not increase. This is the difference in 'kitani’s' country compared to other states. 'Kitani' indeed continue to help 'kitani's' MSMEs but not necessarily the objective to increase government revenue.
Indeed, if there are those who register their company as private limited they are paying corporate tax but besides that, there's no other income like in neighboring countries. Next regarding cooperatives, indeed from the past 'kitani' have faced challenges with cooperatives, some do not make financial statements, do not make accounts from year to year.
In the last two to three years, the Ministry of Finance and Economy has taken steps to increase cooperatives at the time such as 'kitani' me improve governance for cooperatives financial statement. Most cooperatives are now up-to-date and then 'kitani' also to help can digitalize (adoption of digital payment) using computer systems. Most cooperatives previously involved mainly in petrol stations. Now 'kitani' encourage them to involve their activities in priority sectors under the economic blueprint, cooperatives also collaborate with one village one product to expand of production through business merchant and so on.
Some steps have already been taken to assist and look into the business strategies for cooperatives within this country. As of now, there are indeed 160 cooperatives across Brunei with a membership of over 33,000 people and a share capital of $36.3 million, assets nearly $69 million. This is what we continue to do.
Indeed, what was shared by Yang Berhormat earlier about the importance of cooperatives playing a role in expanding the economy as well as helping members involved in some of these cooperatives. We continue to help and support. This effort is new to us in these past few years, definitely an effort that will continue.
Next, regarding the question on indicator expo, indeed, at this time the results of our involvement of our companies in various expos have been seen. At BEDB, DARe each have expos and for the Ministry of Finance and Economy, supports some expos but not involved in all expos. What is listed, two or three expos under BEDB or DARe, the expo concerned is not included in the calculation of the Ministry of Finance and Economy.
Next, regarding arrears, kaola would like to explain, last year reduced arrears by 2.7% for 2023, 2024 to further reduce by another 2% not reduced from the previous year. Meaning this year we achieve 2.7%, next year we continue to achieve another 2% not until it's reduced. This is because at this time we are still installing prepaid meters, most of the arrears at this time are electricity bills, water bills, and perhaps housing.
Since 2016, we have decided to change our prepaid meter with a more sophisticated prepaid meter. Which previously could not be used in large buildings like supermarkets, etc. This new prepaid meter can be used in any building. There were some challenges because of COVID and because of the shortage of microchips worldwide. Production of prepaid meters had a delay. At this time if not mistaken we have already installed more than 20,000 prepaid meters in houses and shops.
We need more than 100,000 prepaid meters. At this time still waiting for the arrival of the new stocks and this delay is caused by the global shortage of microchips and shipment issue, logistics, etc. إِنْ شَاءَ ٱللَّٰهُ it will continue if we could speed up the installation of prepaid meters and so on, then our arrears could have a higher target so that it can be reduced more quickly. This is what we have been trying and إِنْ شَاءَ ٱللَّٰهُ due to unavoidable reasons, this may be reduced as soon as possible. That’s all that koala can share. Thank you, Yang Berhormat Pengerusi.
Yang Berhormat Pengerusi
Thank you, Yang Berhormat Minister at the Prime Minister's Office and Minister of Finance and Economy II for the responses and explanations that have been made which have provided further clarifications regarding the questions and doubts that have arisen from Your Honourable Members who have been appointed.
Your Honourable Members, I think it is sufficient for us to discuss this matter this evening. I think it would be best for us to adjourn our committee meeting and reconvene in the Legislative Council Conference.
(Committee Meeting adjourned)
(Legislative Council Meeting resumed)
Yang Berhormat Yang Di-Pertua
Your Honourable Members, we reconvene in the Legislative Council Conference. I would like to propose that we adjourn our meeting for now so that we can rest. إِنْ شَاءَ ٱللَّٰهُ we will reconvene subject to the sighting of the Ramadan moon. If the moon is not sighted, we will reconvene on Monday, 11 March 2024 as usual starting from 9.30 am and if the Ramadan moon is sighted, we will reconvene on Tuesday 12 March 2024 starting at 10.00 am.
On this occasion, I would like to take this opportunity to wish Your Honourable Members, a blessed Ramadan fasting.
That is all, وَبِاللَّهِ التَّوْفِيقِ وَالهِدَايَةِ. وَالسَّلَامُ عَلَيْكُمْ وَرَحْمَةُ اللَّهِ وَبَرَكَاتُهُ
(Legislative Council Meeting adjourned)
The information provided on this website is for general informational purposes only. While we strive to keep the information up to date and correct, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the website or the information, products, services, or related graphics contained on the website for any purpose. Any reliance you place on such information is therefore strictly at your own risk.
In no event will we be liable for any loss or damage including without limitation, indirect or consequential loss or damage, or any loss or damage whatsoever arising from loss of data or profits arising out of, or in connection with, the use of this website.
Through this website, you may be able to link to other websites which are not under our control. We have no control over the nature, content, and availability of those sites. The inclusion of any links does not necessarily imply a recommendation or endorse the views expressed within them.
Every effort is made to keep the website up and running smoothly. However, we take no responsibility for, and will not be liable for, the website being temporarily unavailable due to technical issues beyond our control.