1. Brunei Darussalam’s Advantage
Recognised as the world’s most stable macroeconomy by the World Economic Forum (GCI 2010/11), Brunei Darussalam is ideally positioned as a destination for doing business and investment for the following reasons:
• High quality of lifeBrunei offers a high quality of life, ranking the highest in the Islamic World and 3rd in Asia, according to the UNDP Human Development Index 2009.
• Political stabilityBrunei’s outstanding record of political stability has been led by a benevolent monarchy that can be traced back, in an unbroken line of succession, over 600 years to when the first Sultan was installed in 1363.
• Strong oil and gas industryOil and gas have been the backbone of Brunei’s economy since their discovery in 1929. In line with its diversification efforts and with easy access to hydrocarbon resources, Brunei is a perfect location for the establishment of oil and gas related industries.
• Well educated populationWith an adult literacy rate of 94%, Brunei has one of the most highly educated populations in the world that is seen as an increasingly valuable resource.
• Modern infrastructureAt the top of Brunei’s development agenda is a well-developed social and business infrastructure that plays a major role towards increasing the nation’s competitiveness and attractiveness as an investment destination.
• Strategic locationStrategically located at the heart of South East Asia and along the East-West maritime trade route, Brunei’s easy connectivity to the growing economies within the region makes it an ideal location for export-oriented activities.
• Rich biodiversityBrunei is well known for its extraordinary biodiversity with approximately 70% of its natural land area reserved for conservation purposes. This is in line with the objective of the national strategy to promote sustainable development.
• Attractive investment incentivesBrunei has one of the most liberal tax regimes in the region with its corporate income tax being one of the lowest. There are also no taxes on personal income, sales, payroll, export, capital gains or manufacturing.
• Competitive utility ratesIn order to promote industrial growth in Brunei, the Government of His Majesty The Sultan offers highly competitive utility rates which are known to be among the lowest in the region.
• Readily available industrial sitesBrunei offers investors readily available industrial sites with supporting infrastructure in order to facilitate the establishment of new industrial investments in Brunei.
Brunei has the least number of taxes in the region. There is no personal income tax and there is no export, sale, payroll or manufacturing taxes. Only companies are subject to tax under the Income tax Act 1949.
Corporate income tax rate has been gradually reduced from 30% (2008) to the current rate of 22%.
3. Free Trade Areas
Brunei Darussalam has been actively engaged in Free Trade Areas (FTAs) through its membership in ASEAN as well as on a plurilateral and bilateral basis. To date it has concluded the following FTAs:
ASEAN:- Australia and New Zealand (ASEAN-Australia New Zealand FTA)- China (ASEAN-China FTA)- India (ASEAN-India FTA)- Japan (ASEAN-Japan FTA)- Republic of Korea (ASEAN-Republic of Korea FTA)
Bilateral:- Japan (Brunei-Japan Economic Partnership Agreement)
Plurilateral:- Agreement with Chile, New Zealand and Singapore (Trans Pacific Strategic Economic Partnership or P4))
Brunei Darussalam together with P4 partners are currently negotiating with Australia, Malaysia, Peru, the United States and Viet Nam to expand further the P4 scopes, which is referred to as the Trans-Pacific Partnership (TPP). The TPP will produce a high-quality Agreement that addresses new and emerging trade issues not yet adequately dealt with in existing trade agreements.
4. Investment Treatiest
Brunei has signed Bilateral Investment Treaty (BIT) which will protect investors and investments of both signatory countries. This includes:- Federal Republic of Germany- Sultanate of Oman- Republic of Korea- People’s Republic of China- Ukraine- Republic of India- Kingdom of Bahrain
Brunei is also a signatory to the ASEAN Agreement on the Protection and Promotion of Investment with all ASEAN countries. In addition, it has signed the Agreement on the ASEAN Investment Area.
5. Double Taxation Agreement
Brunei Darussalam has also signed Bilateral Double Taxation Agreement (DTA), which will ease transaction between businesses of both signatory parties, with the following countries:
- United Kingdom- Republic of Indonesia- People’s Republic of China- Republic of Singapore- Socialist Republic of Vietnam- Sultanate of Oman- Kingdom of Bahrain- Japan- Islamic Republic of Pakistan- Malaysia- Lao People’s Democratic Republic- Hong Kong SAR- Kingdom of Kuwait
1. Manufacturing Sector
Within the manufacturing sector, Brunei Darussalam has the potential to develop new industries both within and beyond the oil and gas industry not only through the utilisation of its rich biodiversity and natural resources but also its strategic location in the region. They include activities that can tap on its hinterland as well as those that will add value to its resources.
Strategically located in the BIMP-EAGA region where key raw materials such as sugar and cocoa can be drawn in from neighbouring countries, Brunei Darussalam sees itself as an ideal destination for the establishment of industries such as food & food ingredients and pharmaceuticals.
1.1 Food & Food Ingredients
The Government of Brunei Darussalam is particularly interested in the food Industry and would like to attract major food and food ingredients companies into the country for exports.
There are numerous opportunities that can take place in Brunei Darussalam, from sourcing and refining raw materials to food manufacturing and eventual distribution to key sizeable markets within the region.
Brunei Darussalam also has the potential to establish research and development centres for the development of innovative nutritional products through the utilisation of authentic local food ingredients that can lead to the manufacturing and processing of customised food products for global markets.
Another focus is on pharmaceutical and pharmaceutical ingredients industry in which the Government of Brunei Darussalam welcomes companies to establish a presence in the country.
Companies may also opt to produce halal pharmaceuticals as a value-add to their products. Brunei Darussalam has developed its very own guidelines and standards for the handling and manufacturing of halal pharmaceutical products with the objective to pave the way for the establishment and production of halal pharmaceuticals in the country while seeking to become a global leader in halal industry.
Brunei Darussalam’s strategic intent is to develop the country into a strategic location in the region for research and development with opportunities to generate new active compounds and manufacture new innovative and competitive pharmaceuticals. It welcomes investments from internationally well-established companies to utilise Brunei Darussalam as a strategic location for companies’ plans for expansion. We look forward to building a rapport and long-term partnership with such companies.
In December 2010, Brunei Darussalam witnessed the ground breaking of its first halal pharmaceutical manufacturing plant at the Lambak Kanan East Industrial Site. Vivapharm (Brunei) Sdn. Bhd. is a joint venture between Canadian firm Viva Pharmaceutical Inc, private equity fund Aureos (Brunei) Capital Sdn Bhd, and a group of local investors. Vivapharm is a B$26million project and is Brunei’s first halal and GMP (Good Manufacturing Practice) certified manufacturer of pharmaceutical and nutraceutical products and will be targeting the growing Halal market. Vivapharm will be focused on exporting Halal-certified natural health products, over-the-counter and prescription drugs to the Asia Pacific regional markets, Middle East, Western Europe and the United States.
Known for its strong oil and gas industry which dates back to the late 1920s, Brunei Darussalam forms a perfect location for the establishment of downstream petrochemicals. Presently, Brunei Darussalam is home to a US$600 million methanol plant developed by a Japan-Brunei consortium, Mitsubishi Gas Chemical Co Inc, Itochu Corporation and Brunei Petroleum. Located at Sungai Liang Industrial Park (SPARK) right next to Brunei Darussalam’s well-established oil and gas industry, the methanol plant started its first commercial operation in May 2010 with a capacity to produce 850,000 metric tonnes of methanol per year. A methanol export facility, known as Single Point Mooring, was also established by the BEDB to facilitate the export of methanol via tankers through a loading buoy connected to the subsea pipeline system.
The establishment of its first methanol plant is expected to pave the way for more opportunities in the downstream oil and gas industry in Brunei Darussalam including methanol-related derivatives, besides other potential gas-based petrochemical projects such as ammonia and urea.
1.4 Integrated Petrochemical Refinery
In further extending the oil and gas value chain, Brunei Darussalam also seeks to offer investors the opportunity to develop integrated petrochemical refineries. Its strategic location at the east-west trade route means that Brunei Darussalam connectivity to the neighbouring markets makes it a perfect location for the setting up of such facilities in order to meet the growing demand for oil-related products.
In July 2011, Brunei Darussalam gas agreed to proceed with the establishment of a US$2.5billion oil refinery and aromatics cracker. The project will be located at Pulau Muara Besar (PMB) and developed in two phases by a leading private Chinese company, Zhejiang Hengyi Group Co. Ltd. With a production capacity of approximately 135 thousand barrels per day, the 1st phase of the refinery and aromatics cracker project will comprise the production of refined petroleum products such as gasoline, diesel and jet A-fuel, as well as paraxylene and benzene, which are mainly used in textile production. The project is set to create about 800 jobs and is expected to catalyse the development of PMB as an economic hub for industrial activities. Following successful completion of Phase 1, the company plans a further investment of US$3.5 billion for the expansion into the production of olefins.
1.5 Renewable Energy
With a long history of oil and gas production, Brunei Darussalam is now looking to open up new frontiers and develop capabilities in renewable energy. Abundant deposits of silica sand available in this country have been seen as conducive to the development of a hub for solar glass manufacturing as well as solar cells and modules production.
2. Service Sector
Within the services sector, Brunei Darussalam seeks to further expand and develop its capabilities by capitalising on its connectivity to the growing economies as well as by building on its highly-skilled workforce and readily available infrastructure in a move towards making the country globally competitive. This includes encouraging the establishment of ICT-related activities in order to make Brunei Darussalam as a regional hub for ICT as well as activities that will help grow its supporting industries.
2.1 Regional Hub for ICT
Brunei Darussalam has identified ICT as one of the key catalysts for sustainable socio-economic development and thus the development of ICT industry continues to be a top priority. The BEDB hopes to promote Brunei Darussalam’s as a regional hub for ICT. Stable, secure, free of natural disasters, with competitive power tariffs and strategically located within the Asia-Pacific and BIMP-EAGA region, Brunei Darussalam is an ideal destination for activities such as data centre/disaster recovery centre as well as software development, wireless communication and multimedia.
2.2 Data Centre/Disaster Recovery Centre
Brunei Darussalam is increasingly competitive when it comes to the data centre industry as we offer one of the most competitive priced utilities in the region. In addition, it has an abundant bandwidth capacity through its web of international submarine cables and state-of-the art telecommunications infrastructure which enables efficient connectivity with the rest of the world. At least 80% of Brunei Darussalam’s SEA-ME-WE3 bandwidth capacity is still open for further utilisation.
To further enhance the international connectivity, Brunei Darussalam has also invested significantly in the Asia America Gateway (AAG) Submarine Cable System which lists Brunei Darussalam as one of its landing stations, providing a seamless direct link between Brunei Darussalam and the United States as well as other Asian countries via one single cable. Brunei Darussalam has also announced its plans to implement a third cable, the South-East Asia Japan Cable (SJC), to increase room for connection redundancy.
2.3 Aviation Support Services
The burgeoning low-cost carriers coupled with aircraft re-fleeting and acquisitions by legacy carriers in the region, and where airlines continue to outsource their maintenance activities outside of their organisation, marks a foreseeable demand for aviation-related activities. With readily available infrastructure in the form of modern and well equipped industrial hangar space at the Brunei International Airport, and with the availability of qualified workforce and technical expertise, Brunei Darussalam is ideally positioned for aviation support services such as aircraft maintenance, repair and overhaul (MRO), as well as flight crew simulation and training.
2.4 Oil Field Support Services – Marine Supply Base and Fabrication Yard
Oil and gas exploration activities are expected to commence in late 2011 with the successful award of Brunei Darussalam’s deep water offshore petroleum blocks CA1 and CA2. In order to support these exploration efforts, a wide range of services will be required by the operators, opening up the opportunity for Brunei Darussalam to develop a centralised Marine Supply Base and Fabrication Yard to house upcoming oil & gas support services industries. There is potential to develop national scale projects at the Pulau Muara Besar (PMB) Island whose naturally deep draft and tranquil harbour are ideal assets for a supply base.
3. Emerging Technologies
In a move to position Brunei Darussalam as a new technology player in the next 20-30 years, the BEDB is currently looking into the feasibility of bringing new frontiers of science and technologies into Brunei to create economic activities driven by accelerated technology developments with increasingly significant economic values. Subject to further research and dialogue with experts, the potential new technologies may be found within the identified sectors of Healthcare/Health Sciences, Food Security, Advanced Manufacturing Processes, Material Sciences, Electronics, as well as further research into the areas of Energy, Sustainable Environment and ICT.
For further information and clarification on the abovementioned sectors including industrial sites, please contact:The Brunei Economic Development BoardBlock 2K, Bangunan Kerajaan,Jalan Ong Sum Ping,Bandar Seri Begawan BA1311,Brunei DarussalamTel: (673) 223 0111 Fax: (673) 223 0082Website: www.bedb.com.bnE-mail: email@example.com
4. Fishery Sector
Brunei Darussalam’s marine fish per capita consumption is estimated at 47kg/year and 50 per cent of the fresh fish requirements are from import. The fisheries potentials of Brunei Darussalam are estimated to be worth at least B$400 million/year by the year 2023. Brunei Darussalam’s clean and unpolluted environment, the absence of typhoon and other food related epidemic or phenomena are amongst the reasons why Brunei Darussalam is an ideal choice for investment in the fishery sector. Furthermore, Brunei Darussalam is also found to be in the migration path of tuna.
Investment opportunities are available in the three major sectors of the fishing industries namely capture fisheries, aquaculture and seafood processing:
4.1 Capture Fisheries
The level of exploitation especially at Zone 3 and 4 are relatively untapped. In its effort to increase the contribution of fisheries towards the national GDP, Brunei Darussalam is opening up opportunities for more investments in this sector especially on the pelagic or tuna fishing. Besides giving supportive facilities and incentives, Brunei Darussalam is also:
i. encouraging participation of new operators either from the locals or as joint ventures;ii. giving technical guidance and assistance for the present operators to realise their maximum potentials;iii. promoting the establishment of more downstream processing industries; andiv. introducing the financial scheme to the local operators; among others.
In capture fisheries, fishing licences are available for operating purse-seiners, tuna long liners in Brunei Fishery Limits in Zone 3 and 4.
ZONE 3 – extends 20 – 45 nautical miles offshore and is open for the larger vessels as follows:
i. Purse-seiners with 60.1-150 Gross Tonnage (GRT) and 351 -600 Horse Power (HP).ii. Long liners with 60.1- 150 Gross Tonnage (GRT) and 351 -600 Horse Power (HP).
ZONE 4 – extends from 45-200 nautical miles offshore and is open for tuna long lining and tuna purse-seining.
Aquaculture is one of the fastest developing sectors in the fisheries industry. The potential of aquaculture in Brunei Darussalam is estimated to be at least B$200 million by the year 2023. Shrimp farming, off-shore fish cage culture, ornamental fish production and freshwater culture are amongst the targeted sectors in aquaculture.
Areas for shrimp farming, specifically a 200-hectare shrimp culture area in Telisai and a 40- hectare eco-aquaculture park in Sungai Paku have been identified. Basic amenities such as access roads, main electricity supply and water supply are provided by the Government. Support facilities are also provided. Technology verification and development are conducted to ensure that appropriate technology and suitable species are available to the aquaculture operators.
4.3 Seafood Processing
The fish processing sector is relatively at a small production of a variety of fisheries products. These products include frozen fish, crackers, fish ball and cakes, fish nuggets, shrimp pastes, marinated fish and dried fish. They are sold and easily available in the local markets. Foreign companies are therefore welcomed to form a joint venture company with local entrepreneurs in further developing the fish processing sectors into larger enterprises.
The local market for processed seafood products presently is estimated to worth B$17 million annually at a sustainable level. There is also the domestic requirement for fishmeal, which at present, about 5 metric tons are being imported per day and with the growing aquaculture, chicken farming, etc. in the country, the demand is set to increase. More rooms are still available for expansion and further development. The Seafood Products Handling Centre in Serasa, next door to Brunei deep-water port offers an integrated business proposition in a rapidly growing fishery industry.
The Department of Fisheries has verified the technology for the production of other value-added products such as smoked fish from underutilised fish.
For further information and clarification on Fishery Sector, please contact:Fisheries DepartmentMinistry of Industry and Primary ResourcesJalan Menteri Besar, Berakas BB3910Brunei Darussalam.Tel: +673 238 3067 / 238 3068 / 238 3412Fax: +673 238 2069Website: www.fisheries.gov.bnE-mail: firstname.lastname@example.org
5. Agricultural Sector
Brunei Darussalam is free from Foot and Mouth Diseases (FMD), Avian Flu and Mad Cow Diseases (BSE) and a member of the World Animal Organization (OIE) since 2004. Opportunities exist in all areas of agricultural production and agribusiness, ranging from primary production and food processing to providing professional services. Brunei Darussalam imports most of its food requirements except chicken and eggs. To ensure security of food supply, Brunei Darussalam is actively promoting agricultural development as well as facilitating in the outsourcing of agricultural commodities and food supply.
5.1 Primary Production
In the primary production sector, opportunities are available in fruit and vegetable production, floriculture, growing of herbal and medicinal plants, feed lot production of livestock and poultry production. Various kinds of agricultural infrastructure such as farm roads, irrigation and drainage as well as water and electricity supplies are given to help entrepreneurs to develop the farmlands.
Vegetable and fruit growing are still profitable ventures to meet domestic demands. Investments on high technology farm and modern technology could raise the productivity and it is still possible to stretch the profit margin of this sector.
The herbal and medicinal plants offer great potential for commercialisation. Some of these plants are already household “brands” for people in Brunei and in the region, but have yet to be exploited in agronomic scales. Enterprising investors could innovate to produce new health food products such as herbal cookies and other tonic beverages.
Floriculture in Brunei Darussalam is still small and steadily developing, but the available facilities offer great opportunity for investors to venture into either the domestic market or into the lucrative global markets. Investors with a wide business network should take advantage of the various incentives offered by the Government to establish their operations in Brunei Darussalam and export their products overseas.
Livestock production is mainly on poultry farming, particularly in the production of chicken meat and eggs. The closed house system of farming in Brunei Darussalam has contributed in raising the production efficiency of poultry farming. Brunei Darussalam is now self-sufficient in chicken meat and eggs. Currently, ruminant (cattle, buffaloes, cows, goats, etc) production is still low and the bulk of the requirement is imported. The feed lot system offers an opportunity for intensive cattle and buffalo production in Brunei Darussalam.
5.2 Secondary Production
Investment opportunities are also abundant for agribusiness in the secondary production which include processing of meat and eggs products, animal feed and fodder, processing of fruit and vegetable juices and cordial drinks, manufacturing of pharmaceuticals from medicinal plants and herbs as well as manufacturing of veterinary medications and biologics.
The processing sector offer vast opportunities for investors. Imported raw commodities can be value-added for domestic and regional markets such as BIMP-EAGA and ASEAN. For example, fresh eggs could be processed into dehydrated powdered eggs, egg whites and egg yolks, as well as liquid egg. Such processed products are easier to handle with longer shelf-life. These products undergo heat treatments process which makes it easier to comply with food safety requirements as compared to raw eggs. Ease of handling and compliance to safety regulations would contribute to transportation and distribution of these products to export market and remote market segments, which are normally not accessible by fresh whole eggs.
The poultry sector provides best opportunities of vertical integration that includes modern breeding farms, hatcheries and production farms of layer and broiler birds. Under the concept of cluster development, it is possible to integrate feed milling with oil-seed extraction and flourmill operations. Hence, the development of egg processing will have a positive chain-effect on the development of crop processing industry, particularly in the business of milling and edible oil extraction. Brunei Darussalam could outsource grains and oil, seeds to sustain its milling and edible oil extraction businesses. In this regard, multinational corporations with agrobased resources will be in the best position to take up the opportunities in milling, edible oil extraction and feed milling. Other than opportunities found in primary and secondary agro industries, the service sector too have many opportunities. Professional services marketing, veterinary practice, and trading of veterinary and agricultural products are needed by the business community and consumers. Such professional are welcomed to set up their practices in Brunei Darussalam.
5.3 Opportunities in ‘Halal’ Products
The Brunei Halal Branding project launched in 2007, aims to make Brunei Darussalam as one of the major players of the global trade in Halal food production and certificate. With its strong Islamic background, the global market can be assured that Brunei Darussalam’s Halal Certification is both stringent and credible for businesses to enter into the Muslim markets.
A 263-hectare area is currently being developed as agro-technological park for investments in Brunei. The park will support activities under the Brunei Halal brand, providing sites for research activities and support services and development of industries through joint-venture and Foreign Direct Investment. A “Halal Science Centre” too will be established within the park.
List of Preferred Industries
Primary ProductionAgriculture• Poultry farming• Cultivation of vegetables, tubers and roots• Cultivation of fruits• Livestock farming• Floriculture/ other ornaments• Production of planting materials• Cultivation of rice and other cereals• Cultivation of herbs and spices• Cultivation of fodder crops or animal feed ingredients• Cultivation of medicinal plants
Integrated Production and ProcessingAgriculture• Cultivation and processing of fodder crops for animal feed ingredients• Poultry farming and poultry products processing• Cultivation and processing of ornamental (cut flowers and other foliage preservation)• Cultivation and processing of fruits• Livestock farming and processing• Cultivation and processing of rice and other cereals• Cultivation and processing of herbs and spices• Cultivation and processing of medicinal plants
For further information and clarification on Agricultural Sector, please contact:Agriculture and Agrifood DepartmentMinistry of Industry and Primary ResourcesOld Airport, BerakasBandar Seri Begawan BB3510Brunei Darussalam
6. Tourism Sector
Tourism and hospitality is a growing industry in Brunei Darussalam. There are existing local, regional and international markets that can be tapped for further growth. Brunei’s well preserved nature, offering easily accessible ecotourism activities that can be further developed, addresses the growing trends towards nature, health and wellness tourism, and its deserted long sandy coastline offers a welcome respite from the more crowded and commercialized regional beach resort areas. Business and investment opportunities are available in the following area:
• Hotels and resort• Restaurants• Ecotourism and leisure tourism• Agro-aqua tourism• Ground handling operations and destinations management• Cruise tourism
For further information on Tourism, please contact:Brunei Tourism BoardJalan Menteri, Besar Bandar Seri Begawan BB3910Brunei DarussalamTel: (673) 238 2832 / Fax: (673) 238 2824Website: www.bruneitourism.travelE-mail: email@example.com