Labuan IBFC contributes RM4.6 bln to nation’s coffer

By Jailani Hasan

LABUAN, Nov 3 -- Labuan International Business and Financial Centre (Labuan IBFC) is becoming a more integral component of Malaysia's economy with its latest economic contribution of RM4.6 billion.

Labuan Financial Services Authority (Labuan FSA) director-general Nik Mohamed Din Nik Musa said  Labuan IBFC has been the engine of growth for Labuan island’s development and contributed more than 60 per cent to the gross domestic product (GDP) of Labuan in 2021.

“Labuan IBFC is one the largest employment providers with more than 6,000 people employed in the financial services sector or 15 per cent of the Labuan’s total employed workforce,” he said in an interview with Bernama today in conjunction with Labuan FSA’s 25th anniversary this year.

He said Labuan IBFC has contributed to more local spending and spur other economic spin-offs in the island with the introduction of the substantial activity requirements like additional manpower, increase in demand for office spaces, commercial building and eatery outlets, among others. 

“Labuan IBFC also plays an intermediation role to facilitate trade, investments and financial capital flows into Malaysia.  

“At the same time, Malaysians investing overseas also use Labuan as a conduit for outward investments,” he said.

Nik Mohamed Din said the Labuan IBFC has gone from strength to strength since its establishment in 1990 and has been a catalytic spur for economic and infrastructural development in Labuan.

“Since the establishment of the Labuan FSA 25 years ago, the guidance and leadership of Labuan FSA has been instrumental in charting the growth and development of Labuan IBFC which correspondingly contributed towards the physical and socio-economic development of Labuan as a whole,” he said.  

Nik Mohamed Din said Labuan FSA has also continuously been deepening Labuan IBFC’s business propositions to create greater value for investors.

“Labuan IBFC views Asia as a strategic growth area and more than 70 per cent of the entities incorporated originated from this region. 

“By offering a regional home to businesses across Asia, Labuan IBFC seeks to play an important role as a facilitator of trade and investment,” he said. 

Nik Mohamed Din said Labuan IBFC’s pragmatic midshore proposition combines the ease of doing business with high international standards of regulation and supervision, making the jurisdiction the ideal base for global business trailblazers seeking innovative growth in Asia. 

He disclosed that Labuan IBFC now hosts several top-ranked financial institutions and intermediaries, and it also has a pool of professional service providers serving clients from around the globe. 

“Labuan IBFC has welcomed more than 5,000 operating companies which include more than 850 licensed entities in banking, insurance, reinsurance, risk management, leasing, capital markets digital financial intermediation and wealth management with parallel offerings in Islamic finance,” he said.

-- BERNAMA