Dialogue On Economic Diversification
By Ben Ng

Bandar Seri Begawan - Asia Inc Forum held an open dialogue session and invited Sami Sindi to present his views yesterday.

His views included suggestions on how Brunei can reduce its dependency on its single source of revenue, oil, and what the Gulf Cooperation Council (GCC) is doing in its efforts to diversify the economy.

Brunei Darussalam in its efforts to reduce dependency on its oil wealth will have to focus on creating capable well trained human resource as well as to create a legal environment that better facilitates economic diversification.

"One of the key missing ingredients is the, availability of well-trained, educated human resources," said Sindi who is also the Founding Partner of Crescent Point and Harvard Law School's Centre for Islamic Studies.

The problem, he feels, is one that nobody has really put much focus on. "It's been discussed a lot, but the solutions have always been 'We'll build more schools' or ‘We'll build more classrooms', but nobody actually ever went to look at what's really needed."

Capable human resource, he believes, is something that you cannot train somebody in a whim. "It is a 30-year programme. From pre-school, if you have not trained a person through primary and secondary education, you've pretty much lost the battle."

He considered the "fundamental flaw" with all the economies that are trying to diversify away from a single revenue source were the inefficiencies that came with "forced solutions".

"So when we talk about diversification, we have to be aware of the inefficiencies introduced by some of the initiatives to achieve diversification," he added.

Another critical part is a clear and comprehensive legal system to better allow diversification, he said, adding that most countries have tried to do that, but missed the mark, as they do not always focus on the right solutions.

"For example, Dubai. They have the legal infrastructure done right, but they did not develop the human resource... so when you measure the success of a country, that is a major failure."

Sindi, who received his honours in Jurisprudence from Oxford University and an LLM from Harvard Law School, went on to speak about foreign labour and its roles in diversifying Brunei's economy.

"Foreign labour is viable, so long as you have hand-inhand a development process for the nation. And for us to expect that we will be able to develop from scratch, a human resource capability that can interact with today's global world, would be very naive," Sindi said. "So it is critical to bring in foreign labour, but it is also vital for us to develop the human resources and learn from that and go up in the ranks and take over." Singapore, he said, is an incredible example.

"They were in a position where they have no natural resources, but they had untrained human resource. So they opened up completely for foreigners to come in and at the same time they created a legal infrastructure that allows for the private sector to thrive building businesses, to service regional requirements.

They worked very hard at developing an educational system that truly educates and teaches students on how to be productive as well as on how to think and move away from a complete welfare state.

"When you tell somebody that you're going to pay for their education and for their health, there's no incentive for that person to work, to be productive," he added. The Singaporeans, he said, have taken charge of their economy. "They've 'singaporised' the economy without any artificial ways, and this is what we lack in the region."

Brunei, he thought, is small and much more manageable, and diversifying away from an oil-based economy need not be just in Brunei itself.

"Today we live in a global world. I grew up and went to New York. I went and built my businesses in Asia, not Saudi Arabia. And today, I go back to Saudi with lots of ideas.

"And this is what you want to build. You want to try and build a generation that is capable of operating on a global level. Brunei can be the base of the operations, provided you don't have an isolationist and nationalistic view."

"Some of the key learnings were the importance of communication among stakeholders, timely implementation and education. We put this together with our partners TOTAL, HSBC and ALCOA to foster greater discussions among the public and private sector on how we can diversify the economy and learn from other regions such as the GCC," said the CEO of Asia Inc Forum, Allen Lai. -- Courtesy of Borneo Bulletin

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