Sarawak needs mix of old and new for greater economic growth, say experts
Published on: Saturday, May 04, 2024
By:
FMT, Lynelle Tham
Economists say Sarawak could enlarge its contribution to national GDP by introducing new industries but there are challenges. (Bernama pic)
PETALING JAYA: Sarawak must ensure sustainable development of its natural resources as well as introduce new industries to expand its economy, according to economists.
Evan Lau of Universiti Malaysia Sarawak told FMT that sustainable management of Sarawak’s resources is crucial to ensure long-term prosperity without harming the environment.
ADVERTISEMENT
“This is in line with the Sarawak government’s post Covid-19 development strategy,” he said in response to the state government’s plans to become Malaysia’s second highest contributor to gross domestic product before the next state elections, which must be held by April 2027.
Sarawak’s contribution of RM140 billion puts it in fourth place, behind Selangor (RM422 billion), Kuala Lumpur (RM263 billion) and Johor (RM142 billion).
Lau and fellow economist Barjoyai Bardai are optimistic that Sarawak will achieve its goal within the next three years but the state would face challenges.
Lau said Sarawak’s growth had come from natural resources such as oil and gas, timber, hydroelectric power and agriculture, as well as tourism.
ADVERTISEMENT
The state must ensure that its resources are sustainably managed to ensure it achieves its goal, he said. “Infrastructure development is also vital for economicgrowth,” he added.
Bardai, of the Malaysia University of Science and Technology, said Sarawak’s venture into unconventional industries such as hydrogen energy can be key to it achieving its economic target.
ADVERTISEMENT
The state had recently received permits to import hydrogen-powered and electric vehicles, which could pave the way for Sarawak to venture into the hydrogen power sector.
“That will make it much easier for them (to attract investors)”, he said, because Sarawak would not be competing with regions such as Kuala Lumpur and Selangor which focus on manufacturing of electronic and electrical products, automotive and aerospace components as well as finance.
Lau said Sarawak will have to diversify its economy beyond the traditional oil and gas sector while addressing socio-economic disparities.
“An over-reliance on commodities such as oil and gas can make the state vulnerable to price fluctuations and market uncertainties,” he said.
He said the state can turn to tourism and manufacturing as alternative sectors to reduce its high dependence on commodities.
Lau said Sarawak must also ensure that its development policies are inclusive enough to bridge the urban-rural divide to bring sustainable growth and nurture social cohesion.
Bardai said Sarawak’s slower growth rate compared with Kuala Lumpur and Selangor could pose a challenge.
In 2022, Selangor recorded an economic growth of 11.9% compared to 6.5% by Sarawak.
Stay up-to-date by following Daily Express’s Telegram channel.
Daily Express Malaysia
