As Brunei wraps up 2024, the nation finds itself at a crossroads - celebrating impressive economic growth yet grappling with deep-seated challenges. With just a decade left to achieve the ambitious Wawasan 2035, can Brunei turn its vision into reality? From hybrid rice harvests to fiscal deficits, underemployment, and missed opportunities, this is the story of a nation racing against time to secure a sustainable and prosperous future. The question is: Will it succeed?
By Malai Hassan Othman
BANDAR SERI BEGAWAN, DECEMBER 2024: As 2024 draws to a close, Brunei stands at a defining moment.
Official numbers highlight encouraging signs of economic recovery, yet behind the figures lies a deeper reality - one of progress tempered by persistent challenges and missed opportunities.
For many Bruneians, Wawasan 2035—the nation’s ambitious vision of a diversified, sustainable, and inclusive economy—feels both hopeful and distant.
The year reflects small but important strides in agriculture, manufacturing, and aquaculture alongside ongoing struggles with fiscal resilience, underemployment, and overreliance on oil.
With just a decade left to deliver on its promises, the question remains: Is Brunei moving fast enough to secure its future?
Brunei’s economy expanded by 6.8% in the first quarter of 2024, a rebound driven by 8.9% growth in oil and gas, with crude production reaching 102,000 barrels per day.
Hydrocarbons continue to dominate government revenues, but progress outside the oil sector is beginning to take shape, signalling early steps toward diversification.
The agriculture sector, long overshadowed, is showing encouraging signs of revival.
In March 2024, the first successful harvest of high-yield hybrid rice at the Lekiun Agricultural Development Area marked an important step toward addressing food security.
Farmers trained in modern rice management techniques have reported higher yields, reflecting the potential of partnerships and innovation in the sector.
Yet, challenges remain. Agriculture currently contributes only 0.49% to GDP, and the sector continues to rely heavily on an ageing workforce, with the average age of farmers hovering around 55 years old.
Younger generations, while recognising the potential in agriculture, remain hesitant to engage due to financial risks, limited access to affordable credit, and outdated perceptions of farming as an unprofitable endeavour.
This financial gap is where the proposal for a Bank Pertanian, or Agricultural Development Bank, could play a transformative role.
Such a bank would focus on providing low-interest loans, grants, and financial products tailored to the needs of farmers, agripreneurs, and agro-industrial businesses.
It could also support financing for modern tools, machinery, and irrigation systems critical to increasing productivity and reducing operational risks.
Agripreneur Dayang Rosenta, who has been part of the hybrid rice project, reflects on this need:
“We need more accessible and affordable financing. Many of us can’t afford new equipment or expand our farms without support. A dedicated agricultural bank could give us the boost we need to make agriculture viable.”
In addition to traditional loans, Bank Pertanian could integrate innovative financial models, such as the muzara’ah profit-sharing scheme, to attract younger farmers into the sector.
By partnering with landowners and sharing farming risks, these models lower the entry barriers for aspiring agripreneurs, ensuring long-term sustainability for Brunei’s agricultural ecosystem.
The establishment of such a bank would align with Brunei’s broader goals of reducing import dependency, improving food security, and creating a productive and sustainable agricultural economy.
It would not only address financial challenges but also reframe agriculture as a viable and respected career for the next generation.
Progress is also emerging in manufacturing, particularly in small-scale industries.
The clothing sector grew by 24.8%, and local food production businesses have begun exporting poultry and processed goods to regional markets.
However, entrepreneurs continue to face significant hurdles. Haji Rosli, a café owner who expanded into food production, highlights the challenges:
“We have good products, but access to better packaging and bigger markets is tough. If we want to compete outside Brunei, we need support to improve quality and visibility.”
While industrial parks such as Sungai Liang offer opportunities, bureaucratic processes, limited infrastructure, and market access remain barriers for small businesses.
The aquaculture industry also shows promise as Brunei explores its blue economy potential.
Sustainable fish farming initiatives at Sungai Liang Industrial Park have increased local production of sea bass, tilapia, and shrimp, contributing to food security and reducing imports.
Still, small-scale operators face challenges with outdated tools, inconsistent technical support, and limited access to financing.
Progress in Downstream Industries
Brunei’s downstream industries continue to be pillars of the non-oil economy, showing strong growth and export potential in 2024.
Brunei Methanol Company (BMC) and Brunei Fertilizer Industries (BFI) exemplify this progress, with significant contributions to industrial output and exports.
BFI, operational since 2021, has expanded its production capacity, exporting $356 million worth of urea in 2024, further solidifying Brunei’s position in the global fertiliser market.
The facility not only creates jobs but also drives economic activity in supporting sectors like logistics and supply chain management.
Similarly, BMC, a major player in the methanol sector, has strengthened its output to cater to growing regional demand.
Methanol, a key feedstock in various industries, has bolstered Brunei’s export profile while positioning the country as a reliable supplier in Asia.
These downstream ventures are not only adding value to Brunei’s hydrocarbon resources but also laying the groundwork for broader industrial diversification.
Together, they demonstrate the potential of leveraging Brunei’s natural assets to create sustainable economic opportunities beyond crude oil and LNG exports.
While these gains provide cautious hope, Brunei continues to face deep-rooted structural challenges.
The fiscal deficit, projected to reach $2.99 billion for FY 2024/25, underscores the economy’s heavy dependence on hydrocarbons as its primary revenue stream.
Despite diversification efforts, oil and gas remain Brunei’s economic backbone, leaving it vulnerable to price fluctuations and global market uncertainties.
Traditionally, navigating such deficits has involved calls for prudent spending and cost-cutting.
However, observers argue that Brunei must adopt a smart investment mindset - one that prioritises strategic spending in growth sectors such as agriculture, manufacturing, and ICT.
These investments could unlock long-term revenue streams and reduce dependency on oil and gas.
Brunei’s $70 billion reserve, a testament to decades of resource wealth, offers a unique opportunity to accelerate this transformation.
Strategic use of these funds - focused on building infrastructure, supporting emerging industries, and fostering innovation - could serve as a catalyst for sustainable economic growth.
However, analysts caution that the reserve, while substantial, must be leveraged wisely.
Overreliance could risk depleting the nation’s financial buffer, but targeted investments in future-ready industries could secure Brunei’s fiscal resilience for generations to come.
A smart investment approach would mean directing resources toward sectors that create jobs, foster innovation, and position Brunei as a competitive player in regional and global markets.
While fiscal prudence remains essential, growth-oriented spending is key to breaking the cycle of deficit reliance and ensuring the economy thrives beyond hydrocarbons.
At the same time, Brunei’s employment landscape reflects another pressing challenge: underemployment and job mismatch.
Many graduates are forced to settle for roles that do not match their qualifications, leading to frustration and a sense of wasted potential.
Yasin, an engineering graduate working part-time in retail, sums up the reality:
“I studied engineering, but I’ve been working part-time in retail. There just aren’t enough quality jobs that fit what we’ve trained for.”
For years, efforts to address unemployment have focused on balancing supply and demand, often by pushing job seekers into available vacancies.
However, this approach inadvertently contributes to underemployment - where individuals are underutilised in roles far below their capabilities.
A mindset shift is needed: from simply reducing unemployment numbers to creating meaningful, quality job opportunities.
This means investing in future-ready industries, such as renewable energy, ICT, and the creative economy, and fostering entrepreneurship to empower Brunei’s youth to build their own opportunities.
Such a focus would not only address job mismatch but also align employment strategies with Brunei’s economic aspirations under Wawasan 2035.
With 2025 approaching, Brunei is now just a decade away from its Wawasan 2035 target.
The seeds of progress - seen in hybrid rice cultivation, sustainable aquaculture, and small business ventures—are beginning to sprout.
However, without bold, sustained action, these opportunities risk being lost.
Observers argue that Brunei must act urgently to address these challenges by:
- Expanding investment in non-oil sectors like agriculture, aquaculture, and manufacturing.
- Supporting farmers and young entrepreneurs with innovative financing models such as the muzara’ah profit-sharing scheme and establishing a dedicated Bank Pertanian
- Leveraging its $70 billion reserve for smart, growth-oriented investments that create resilience beyond hydrocarbons.
Brunei’s economy has shown its resilience in 2024, but growth alone is not enough.
The time for bold execution is now - because a vision without action is just a dream.
The next ten years are Brunei’s opportunity to build a future that its people can see, feel, and believe in.
As we close the chapter on 2024, let us look forward to 2025 with renewed hope and determination.
May the new year bring prosperity, progress, and the realisation of a brighter future for all Bruneians. (MHO/12?2024)
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