US$1 Billion In Brunei-China Trade By 2010?
By Azaraimy HH

Bandar Seri Begawan - With a total bilateral trade volume standing at under half a billion dollars (B$487.5 million), can Brunei and China deliver their 2010 trade target of US$1 billion set by the leaders of the two countries? This poses a huge challenge and at the rate it is going, the goal might not be attainable.

However, Dato Paduka Haji Hamdillah Haji Abdul Wahab, Acting Minister of Industry and Primary Resources, is optimistic and spelt out what needs to be done to achieve what he called the common goal of the two countries.

Highlighting Brunei's very attractive investment environment and trade opportunities with China, he sought to bring out the necessary dynamism to help achieve the US$1 billion trade target.

Brunei's bilateral business relationship with China has never been better, Dato Paduka Hj Hamdillah, said yesterday at the Rizqun International Hotel during the Guangxi-Brunei Investment and Cooperation Seminar.

Also present were Guo Shengkun, General Secretary of the CPC Party Committee of Guangxi Zhuang Autonomous Region, Chinese Ambassador Tong Xiaoling, Li Jin Zao, Vice Governor of Guangxi Zhuang Autonomous Region, prominent local figures, as well as business delegations from Guangxi Zhuang and Brunei Darussalam.

China, Dato Paduka Hj Hamdillah said, is among Brunei's 10 most important trading partners and peopleto-people contacts last year were enhanced when about 30,000 tourists from China visited Brunei for holiday and business. This is the second highest tourist arrivals after Malaysia, and one that registered the highest growth at 48 per cent in 2007 compared to 2006.

"The question that I ask myself is: how does this strong partnership translate in terms of trade and investment?" he said. Speaking to over a 100 Chinese officials and business delegates, and at least 100 delegates from Brunei, he said, "after my private dialogue with Your Excellency this morning before we entered the Seminar Hall, I am very much encouraged by the passion and deep interest on your part to capitalise on those four opportunities which we signed up to under the MoUs".

To achieve the US$1 billion trade goal, he said, the two countries need to triple their efforts, aggressively pursue more sales of oil and accelerate their investment drive in mutually beneficial areas like tourism, education, Brunei Halal Brand, agrotech products, aquaculture and deepwater captured fisheries, the PMB deepwater port development and transhipment.

"Let me now share with you what Brunei Darussalam has to offer to Guangxi investors and potential partners."

He emphasised the Sultanate's strong fundamentals, stating that the country's employment regulations are among the best in the world. In a study by the World Bank Institute on 212 countries from 1996 --2006, Brunei Darussalam achieved percentile rankings of 50 and above in five dimensions, including political stability at 92.8; regulatory quality at 80; government effectiveness at 72; and control of corruption 63.4. These are strong fundamentals for sound and enabling business environment. For Ease of Doing Business Index, Brunei's global rank is 78 out of 178.

He also cited UNDP Human Development Report in 2007 which ranked Brunei as 30th out of 175 countries.

"Our people are well educated with 92.7 per cent adult literacy rate and our citizens and residents have a broad range of language skills. Mandarin and other Chinese dialects are widely spoken in Brunei Darussalam."

Dato Paduka Hj Hamdillah also spoke of his ministry's vision in the country's economic drive. "Our Vision for Brunei is - A diversified, competitive and sustainable economy," he said. To achieve this vision, the ministry focuses ona three main areas, namely, the Brunei Halal Brand and export agro-business; Heart of Borneo and Eco-Tourism and in aquaculture, Integrated Technical Service Support and seafood processing in conjunction with exploiting further Zones 3 and 4 of the country's deep water."

Brunei Halal Branding project offers a strong strategic partnership between Brunei and Australian food manufacturers to capitalise on Brunei's strong 600-year Islamic credentials and cater to the 1.9 billion global Muslim population. He said, "We are starting with food and our ambition is to extend the Brunei Halal Brand to pharmaceuticals and cosmetics. Our target is to capture a minimum one per cent of the 500 billion US dollars global halal market by 2020".

Brunei is pretty optimistic, he said, that its goals in the global halal market and industry are offering avenues where foreign firms can become its partners. He also invited Chinese involvement in what could be a mutually profitable partnership.

"In particular, we welcome the development of export-oriented halal industries in areas such as the supply of raw materials (and I am pleased to report here that we are importing frozen meat already from Inner Mongolia for example); production and manufacturing; packaging; storage; transportation, logistics and other related services".

In the primary resources sector, namely, fisheries and agribusiness, Brunei offers opportunities to work together to develop its deep-sea fishing for tuna and tuna-like species; in shrimp and fish culture production; eco-aqua park development; livestock production; biotechnology; high technology crop production - all of these with particular emphasis on environmentally-friendly and high-tech agro-business.

Brunei also has unique local ornamental fish species which can be developed commercially, he said.

In the manufacturing sector, Dato Paduka Hamdillah said, Brunei also welcomes investments in the commercial production of printed circuits, construction materials, metal products, silica-based products, ceramics, furniture, ICT products, spare parts and aircraft components, leather goods and cosmetics.

In the tourism and hospitality services, Brunei welcomes investment and partnerships in eco-hotels and resorts, ground handling, and restaurants. "We're also looking for partners to develop our eco-marine tourism and health tourism sectors in conjunction with sports tourism".

"I was made to understand, three separate minutes of meeting have been signed between the Agriculture, Fisheries and Tourism dep'artments of my Ministry and another one with Ports Department of the Ministry of Communication with (their) Guangxi Zhuang counterparts yesterday. I believe that these minutes will help lay a foundation and provide the groundwork for future expansion of collaboration in these sectors".

To further make investment in Brunei Darussalam more attractive, Dato Paduka Hj Hamdillah said, the government has earmarked and developed several industrial sites such as 263 hectares for Agro Technology Park, 250 hectares for shrimp aquaculture and 40 hectares for Eco-Aqua Park in Tutong, 200 hectares for offshore cage culture, tuna fishing in Zone 4 (that is between 45 to 200 nautical miles from the coast) and thousands of hectares of land for high yielding rice plantation in Temburong with some requiring infrastructure development like irrigation and drainage. There are also 11 ready-to-occupy industrial sites under the Brunei Industrial Development Agency, with ready facilities and amenities, he added.

In addition to these investment and business opportunities, Brunei Darussalam is also a tax haven for investors and businesses.

Dato Paduka Hj Hamdillah said, "We have no personal income tax, payroll tax, sales tax, manufacturing tax, nor export tax. Since the beginning of this year, His Majesty the Sultan and Yang Di-Pertuan of Brunei Darussalam has consented to reduce the corporate income tax, from 30 per cent to 27.5 per cent. This rate will be further reduced to 25.5 per cent by 2009. Exemption from corporate tax is also possible for targeted high-tech and pioneering investments.

"As further encouragement for investment in certain sectors, capital allowances in industrial building and structures, including hotels, have been increased from 10 per cent to 20 per cent."

Dato Paduka Hj Hamdillah said Guo Shengkun's presence in Brunei signalled the Chinese intention to reinforce the economic and commercial links and business exchanges between Brunei Darussalam and Guangxi Zhuang Autonomous Region. "We believe that expansion of our economic and commercial contacts would provide the necessary dynamism to our relationship in realising our common goal of delivering the US$1 billion by 2010."

This brings a matter of mutual interest to Brunei Darussalam and Guangxi — that is the organisation of the Asean-China Expo or more commonly known as the CAEXPO. Dato Paduka Hj Hamdillah said this year will be the fifth time Brunei Darussalam will participate in the expo. "Led by the ministry, Brunei Darussalam's business delegation has been increasing in numbers each year — a sign of our conviction and support to make this expo the platform for business and investment cooperation development between Asean countries and the People's Republic of China, specifically the Guangxi region.

"This year, I was made to understand that the main theme of the Expo is Asean-China Information and Communication Technology Cooperation."

Under the Ministry of Communication, ICT development is also very much on the country's agenda. Through the BEDB, Brunei Darussalam recently launched the iCentre —an industry incubation programme to develop the next generation entrepreneurs in the ICT sectors. "I am very sure, with the support of the Ministry of Communication and BEDB, our ICT sectors' presence at the 5th CAEXPO will be of considerable strength and would create another opportunity for collaboration in ICT investment, trade and services," Dato Paduka Hj Hamdillah added. -- Courtesy of Borneo Bulletin

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