Purchase OBG Publications

As Brunei Darussalam prepares to diversify its economy away from oil and gas, it is looking toward other sectors to contribute further to GDP. The transport industry has thus found itself in the spotlight, with expectations of the sector’s economic and strategic potential running high. The extent to which the various transport- and logistics-related initiatives are successful remains to be seen; however, the government appears to be taking the challenge of transforming the sector into a regional powerhouse seriously. Foreign investors and the private sector are also beginning to recognize that transport and logistics are now ripe for investment. If all goes according to plan, mega-projects like Temburong Bridge – which will connect Brunei Darussalam’s western and eastern halves – could catalyze greater economic efficiency for the entire Sultanate. This chapter contains an interview with Dermot Mannion, Former Deputy Chairman, Royal Brunei Airlines.

The government of Brunei Darussalam has taken the initiative with regards to fostering a strong ICT sector in the Sultanate. The government is mindful of technology’s potential to create value for the country’s economy and to ensure social development for its citizens. To date, government officials, in concert with the private sector, have initiated various strategic ICT infrastructure projects and pursued the development of a comprehensive e-government system.These undertakings are fully aligned with the goals set out in the country’s long-term strategic vision, Wawasan Brunei 2035, which charts a course toward a “smart society” composed of an educated, highly skilled work force, with its people enjoying a high quality of life in a country where there is dynamic and sustainable economic growth. This chapter contains an interview with Pengriran Zain, Chief Executive, and Authority for the Info-communications Technology Industry (AITI).

Consisting of both Islamic and conventional insurers, the Sultanate’s insurance sector has held steady in recent times, despite strong external pressures on Brunei Darussalam’s economy. Non-life remains a dynamic segment, with Islamic takaful products making up the bulk of these general insurance premiums. This pattern looks set to continue in the year ahead, too, with the next 12 months also promising to be one of further professionalization of the sector’s distribution channels, in response to increased globalization and liberalization as the ASEAN Economic Community takes hold. The potential future impact of the Trans-Pacific Partnership agreement on the sector is also now a subject of debate by industry players. This chapter contains an interview with Osman Jair, Managing Director, Insurans Islam TAIB; and Chairman, Brunei Insurance and Takaful Association (BITA).

With a strong Islamic banking sector, a growing Islamic insurance (takaful) industry and an expanding market for Islamic bonds (sukuk), Brunei Darussalam has recently been drawing much attention internationally as a center for Islamic financial services (IFS). Indeed, Brunei Darusslam is now amongst the nine countries worldwide where Islamic finance has reached systemic importance – places where more than 15% of total domestic banking assets belong to the sector. Located in the heart of a region that contains five of the 10 largest Muslim countries by population, Brunei Darussalam is also well placed to capitalize on the fast-growing role Asian Islamic finance is taking in this robust global industry. With some two-thirds of the world’s Muslims living in Asia, many of them in seriously under-banked markets, such as Indonesia, the region continues to hold strong potential for the industry. This chapter contains an interview with Javed Ahmad, Former Managing Director, and Bank Islam Brunei Darussalam (BIBD).

The Sultanate’s small but solid banking sector has been going through some significant changes in recent times. Consolidation has led to fewer lenders, a process that is likely to continue, while at the same time those banks that do remain are some of the best resourced in the region. Indeed, Brunei Darussalam’s banks have high levels of liquidity, good capital adequacy ratios and well-managed levels of non-performing loans. The sector includes both Islamic and conventional banks, with the former being dominant – a feature that makes the Sultanate unique in Asian banking. This chapter contains interviews with Yusof bin Haji Abdul Rahman, Managing Director, Autoriti Monetari Brunei Darussalam (AMBD); Pierre Imhof, CEO, Baiduri Bank; and Ajay Kanwal, Regional CEO, ASEAN and South Asia, Standard Chartered.

With the recent descent of oil and gas prices on international markets, the role and future direction of the Sultanate’s industrial sector has never been of greater importance to Brunei Darussalam’s economy. Indeed, diversification away from hydrocarbons production is greatly contingent on industry taking a larger share of the country’s GDP. This necessary shift towards more knowledge-based, value-added economic activities has also long been central to the development goals of the government. A series of plans and programmes have thus been launched over the years with this objective in mind. These now add up to a robust framework that provides investors and enterprises with many opportunities and incentives to do business in the Sultanate.