By Siti Radziah Hamzah
KUALA LUMPUR, May 25 (Bernama) -- Amid global economic shifts, Sabah is making deliberate, calculated moves to position itself not just as a regional player, but as a formidable force in global trade and sustainability.
Armed with a clear economic vision, abundant resources, and bold policy innovation, the state is carving a distinctive identity -- one that fuses industrial ambition with environmental stewardship.
A Land Rich in Promise
Nestled in northern Borneo, Sabah is blessed with enviable geographic and economic assets, underpinned by its strategic position within ASEAN -- projected to become the world’s fourth-largest economic bloc -- and intrinsically tied to emerging global production networks.
Sabah's natural wealth strengthens its strategic advantage. The state holds a third of Malaysia’s oil reserves, and 49 per cent of the country’s crude palm oil exports originate from Sabah, making it a key contributor to the sector with an estimated 10 per cent share of global palm oil supply.
Its marine economy is equally impressive.
“We are one of those states where our self-sufficiency level in marine resources, particularly fisheries, is more than 100 per cent. That’s something we are really proud of,” said Invest Sabah Bhd chief executive officer Dr Firdausi Suffian.
Diversification Through Industrialisation
While resource wealth is a cornerstone, Sabah’s forward-looking strategies emphasise economic diversification.
Under the Sabah Maju Jaya (SMJ) plan, the state is pivoting to expand its downstream industries and enhance its manufacturing capabilities.
“In 2023, Sabah recorded a 4.4 per cent manufacturing growth rate, the highest among Malaysian states. This reflects our commitment to expanding the manufacturing industry,” said Firdausi.
The state’s total approved investment over the last five years stands at RM56.43 billion, reflecting sustained investor confidence and proactive industrial policies.
Three new industrial parks in Kota Belud, Kudat, and Beaufort are being developed to further expand this capacity.
Policy Innovation: Biomass, Blue Economy and Energy Master Plan
Sabah is also setting the pace on green growth. In 2024, it became the first Malaysian state to introduce a Biomass Policy, leveraging its palm oil waste to support renewable energy (RE) initiatives.
“We introduced the policy because we have close to one-third of Malaysia’s total biomass. It’s important to regulate this and ensure we have sufficient feedstock so we can boost our biomass energy,” he said.
These efforts are complemented by Sabah’s Blue Economy Policy, aimed at harvesting and managing marine resources sustainably.
The Ocean Thermal Energy Conversion Enactment (OTEC) further cements Sabah’s status as a pioneer in ocean-based RE.
To support these transitions, the Sabah Energy Roadmap and Master Plan outline a path toward energy reliability and net zero emissions by 2050, and the state’s power infrastructure is being modernised with support from the Energy Commission of Sabah and Sabah Electricity Sdn Bhd.
Oil, Gas, and Shared Prosperity
Oil and gas continue to be a key pillar of Sabah’s economy, contributing over 30 per cent of Malaysia’s oil and condensate output and 18 per cent of its natural gas production.
The Sabah Oil and Gas Development Corporation and the Sabah Ammonia Urea (SAMUR) project in the Sipitang Oil and Gas Industrial Park (SOGIP) underscore the state’s commitment to building an integrated and value-added oil and gas ecosystem.
”We have already received more than RM50 million in dividends from the commercial collaboration with Petronas.
“The Commercial Collaborative Agreement (CCA) between Sabah and Petronas has expanded the state’s participation and revenue-sharing in its hydrocarbon wealth,” said Firdausi.
Unlocking Sabah’s Frontier Energy Potential
While Sabah is already rich in proven reserves, recent developments point to a potentially game-changing new frontier: the Layang-Layang, Sandakan and Semporna basins.
Through the cluster approach, which groups exploration blocks for strategic development, Sabah is unlocking what are currently classified as non-producing hydrocarbon basins.
Two of these exploration blocks -- SB306A and SB360B -- are already gaining traction with companies such as Tokyo-based INPEX Corporation and Petronas Carigali Sdn Bhd involved, and state-backed SMJ Energy Sdn Bhd (SMJE) playing an increasingly prominent role.
“These are Discover Resource Opportunities (DROs). That means there’s already a known quantity there. The contractor’s job is to confirm how much is recoverable and then extract it,” Firdausi explained.
He opined that this push into the frontier basins is not just about expanding reserves but about spurring job creation and industrial activity, especially in Sabah’s east coast, which stands to benefit from the cascading effects of oil and gas operations.
“You’re looking at around 10,000 jobs a year. And with the OGCE (Oil and Gas Conference and Exhibition), there will be another spin-off for the industry, helping the east coast area develop further,” Firdausi said.
The development model also encourages competitive collaboration between operators.
“By having two sets of operators run the asset -- north and south -- you see different ways of developing and exploring. It brings a bit more competition,” he said.
This strategy reflects Sabah’s maturing approach to natural resource development: collaborative, innovative, and geared for both economic and social returns.
Future-Proofing Sabah: The Road Ahead
Looking ahead to 2030, Sabah is forecasting an 8.0 per cent gross domestic product growth rate, driven by agriculture, manufacturing, oil and gas, and a burgeoning digital economy.
“Sabah has almost everything when it comes to growth,” said Firdausi.
The state is also focusing on helping small and medium enterprises (SMEs) transition toward sustainability.
“SMEs need time to transition. Incentives help, but we also need to be realistic,” Firdausi said.
Invest Sabah: Leading the Transformation
At the heart of Sabah’s transformation is Invest Sabah, a one-stop investment facilitation centre under the Ministry of Industrial Development and Entrepreneurship.
“We want to ensure the state has a vibrant domestic ecosystem, an inclusive economy, and a pro-investor climate. Private sector is the engine of growth for the state,” said Firdausi.
With strong policies, strategic vision, and untapped potential, Sabah is no longer just preparing for the future — it is helping to define it.
-- BERNAMA
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