Sarawak's resilient, sustainable growth

KUALA LUMPUR: Sarawak stands as a beacon of successful economic development, drawing the attention of domestic and international investors.

The state's resilience and prosperity can be attributed to the diversification of business sectors and the introduction of innovative strategies this year.

This emphasis not only fortifies the economy's resilience but also creates avenues for sustainable growth.

This year, Sarawak achieved its highest revenue performance with RM13.1 billion, primarily attributed to dividends received this month.

Its commitment to adaptability and forward-thinking measures are exemplified through a series of innovative business initiatives.

By embracing technological advancements and advanced business models, the state positions itself as a dynamic player in the global economic landscape.

These initiatives contribute to the overall vibrancy of Sarawak's economic environment. In essence, Sarawak's success story is a result of meticulous strategic planning, deliberate sectoral diversification and a proactive approach to business.

This combination not only attracts investors but also solidifies Sarawak as a promising hub for sustained economic growth and development.

Strategic Budgeting for Sustainable Growth Sarawak Premier Tan Sri Abang Abdul Rahman Johari Abang Openg recently presented a groundbreaking 2024 state budget of RM12.363 billion under the theme "Development for All".

The budget reflects a commitment to prosperity, sustainability and unity, with a breakdown of RM4.563 billion for operational expenditure and RM7.8 billion for the development fund. Abang Johari anticipates a surplus of RM386 million, highlighting 12 key areas such as economic growth, rural development, investment and digital transformation.

The budget's focus on economic development is expected to drive a five to six per cent growth next year despite the global challenges.

Noteworthy sectors contributing to this growth include the service sector, a robust palm oil industry and a construction sector poised for a 5.7 per cent expansion this year.

The state's commitment to digital transformation is evident in, among others, the Sarawak Linking Urban, Rural, and Nation (SALURAN) initiative and a substantial investment of RM26 million in key digital projects.

Revenue collection has surpassed projections, reaching RM11.63 billion up to October. Abang Johari is optimistic about ending the year with a record revenue of RM12.718 billion, citing various sources.

Looking ahead, the state is committed to inclusive economic growth, having allocated RM9.04 billion for development projects, including the People's Project and the Rural Transformation Project.

The launch of SarawakID Corporate is set to streamline online services and provide a unified platform for business sectors.

As Sarawak charts a course for economic growth and digital excellence, the 2024 state budget underscores its commitment to a prosperous and sustainable future for its residents, making it Malaysia's preferred investment destination.

Facilitating Business and SMEs To support small and medium enterprises (SMEs) in Sarawak, the 2024 state budget introduced a range of initiatives aimed at fostering growth and resilience in the business community.

The emphasis is on tangible support, covering financial assistance, capacity building and digitalisation to ensure SMEs remain competitive in a changing market.

Among the initiatives is financial support for SMEs, where the budget allocates RM6 million to the Sarawak Micro Credit Scheme and Small and Medium Industry Loan Scheme (SPIKS).

This support has already made a difference, with RM13.9 million disbursed this year, benefiting 315 SMEs.

Another initiative is interest subsidies and recovery initiatives, where the Special Relief Fund, Targeted Relief & Recovery Facility (TRRF) and PENJANA Tourism Fund (PTF) provide a financial boost for SMEs.

With a total subsidy of RM77 million, these initiatives have benefited 3,320 recipients. Another area of focus is digital transformation. The Go Digital programme will take a central role next year with a RM4.5 million allocation. This initiative encourages SMEs to embrace digital entrepreneurship.

This year, 500 SMEs benefited from a total assistance of RM5 million, emphasising the programme's effectiveness in promoting digital adoption among businesses. Another aspect is entrepreneurial development with a focus on technical skills.

With an allocation of RM2.5 million, the Small and Medium Entrepreneurs Development programme and Program Pembangunan Latihan Keusahawanan provide practical support. These empower entrepreneurs with the technical skills necessary to start and expand their ventures.

InvestSarawak: Fostering Growth and Collaboration InvestSarawak, established as a one-stop agency for investments, is a testament to the state's commitment to fostering a conducive environment for both domestic direct investments (DDIs) and foreign direct investments (FDIs).

Abang Johari has announced an allocation of RM7 million to support Invest Sarawak's operations and activities. A significant development is the signing of a memorandum of understanding between Invest Sarawak and Surbana Jurong Infrastructure Pte Ltd to enhance collaboration in, among others, the green energy sector.

The government's commitment to supporting SMEs is evident in the comprehensive initiatives outlined in the 2024 Budget. These initiatives include programmes such as Skim Kredit Mikro Sarawak, Go Digital Programme and special relief funds.

As the government eagerly awaits the positive impact of these measures on enterprises and the overall economic landscape, the collaborative efforts between Sarawak and Surbana Jurong, as well as the potential involvement of the Sabah government, set the stage for transformative changes in Borneo's aviation landscape.

MASwings Acquisition: Bridging Connectivity In a bold move, Abang Johari announced the government's intention to acquire MASwings, positioning it as a vital infrastructure investment akin to constructing bridges or highways.

He emphasised the long-term commitment to creating a state-owned airline that ensures stable airfares, especially during festive seasons, and facilitates improved air connectivity for the people of Sarawak.

The acquisition process is currently undergoing due diligence, with both the state Transport Ministry and the Tourism, Creative Industry, and Performing Arts Sarawak actively involved. A joint working committee is exploring the possibility of including the Sabah government in the equity acquisition, demonstrating a commitment to regional cooperation.

The acquisition of MASwings, anticipated to be completed in the second or third quarter of next year, signifies Sarawak's ambition to establish a robust air infrastructure. BESarawak's Stellar Performance Sarawak's business events sector, under the umbrella of BESarawak, achieved remarkable success this year, surpassing expectations and solidifying its position as a leading hub for national and international events.

The state hosted an impressive 95 events, boasting an estimated total expenditure of RM346.5 million, exceeding the initial target by an impressive 139 per cent.

State Tourism, Arts, and Culture Minister Datuk Seri Abdul Karim Rahman Hamzah shared these accomplishments during a recent appreciation dinner for the BESarawak board of directors. The minister highlighted the strategic alignment with the post-Covid-19 Pandemic Development Strategy 2030 (PCDS 2030) as a key factor in the success of Sarawak's business events sector. Sarawak's achievements this year include playing host to 107 events, representing a seven per cent year-on-year increase.

Abdul Karim said this growth in delegate numbers and its economic impact signalled a robust return to the vibrant pre-pandemic Sarawak. Looking ahead, Sarawak aims to host 42,000 delegates, projecting a direct delegate expenditure of RM188.3 million with an anticipated tax revenue of RM20.8 million from 2024 to 2028.

This ambitious goal underscores Sarawak's commitment to sustaining the momentum and further establishing itself as a prime destination for conferences, exhibitions, and meetings. Trade Ties with the United Kingdom Trade between Sarawak and the United Kingdom surged to RM150.7 million, a significant increase from RM74.9 million in 2021.

Deputy Premier Datuk Amar Awang Tengah Ali Hasan highlighted the opportunities for collaboration in goods and services. Investments from the UK in Sarawak, primarily in the petrochemical and gas industries, have reached RM345 million.

The government is actively seeking more collaborations, with a special committee overseeing partnerships with companies from Abu Dhabi and Qatar. Sarawak is recording substantial domestic and foreign investments, with Invest Sarawak serving as a one-stop centre to facilitate trade and investment.

LONGi Malaysia's RM1.3 billion investment in a solar manufacturing plant in Bintulu is expected to create jobs and position Malaysia as a key hub for solar energy. A special committee has been formed for collaborations with Mubadala and Masdar from Abu Dhabi and Qatar, respectively, focusing on oil and gas, and green energy sectors.

British Petroleum's interest in collaborating with PETROS on carbon capture enhances Sarawak's global standing as "carbon negative". Blue Economy Policy and Roadmap Abang Johari announced Sarawak's commitment to sustainable development through the Sarawak Blue Economy Policy and Roadmap (SBEP).

Aligned with Sarawak's PCDS 2030, the SBEP focuses on fisheries, aquaculture, renewable energy, tourism and shipping. A key initiative is a deep-sea port in Tanjung Embang, positioning Sarawak as a maritime gateway.

The state also emphasises collaboration with Indonesia in maritime transport and shipping. Abang Johari highlighted progress in sustainable hydropower, aiming for 20,000MW capacity, with legislative changes to promote solar energy adoption.

The state also explores hydrogen applications and envisions becoming a hub for hydrogen production.    

Abang Johari has invited collaboration for sustainable growth, emphasising Sarawak's dedication to a green and sustainable economy. Green Energy Initiatives and Carbon Neutrality Abang Johari is actively advocating green energy initiatives and focuses on promoting the Autonomous Rapid Transit (ART) system for its carbon neutrality.

He highlighted Sarawak's efforts in developing hydrogen production plants and refuelling stations, particularly for the Kuching Urban Transportation System project.

He received recognition for leadership in sustainability at the World Green and Sustainability Summit and explored collaborations with British Petroleum on carbon capture projects.

Abang Johari also emphasises the state government's commitment to clean energy through the PCDS 2030. Sarawak's achievements in environmental sustainability and its status as a high-income state provide a foundation for attracting international investors.

During the 28th Conference of the Parties (COP28) in Bali, Abang Johari engaged in bilateral talks with Singapore and facilitated discussions between Sarawak Energy and Masdar on clean energy development.

He has also provided assurances that there are no issues regarding carbon capture, utilisation, and storage (CCUS) rights in the region. He emphasised that the Sarawak Land Code, particularly the Carbon Storage Rules amended last year, enshrines the state's ownership of CCUS rights and its continental shelf.

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