Country’s economy projected to grow 2% this year: UN survey

National 1 minute, 52 seconds

BANDAR SERI BEGAWAN

BRUNEI’S economy is projected to grow two per cent this year and three per cent in 2017, according to the recently published UN Economic and Social Survey of Asia and the Pacific 2016.

The projected growth is in line with the outlook of the region’s economies in the next two years as countries continue to rebound from downturns in growth rate in 2015.

However, the projected economic growth for Brunei will maintain its position as among the slowest-growing economies in the ASEAN region, along with Singapore, at a projected rate of two to 2.5 per cent in the next two years, the only economies experiencing the same growth rates. Myanmar will continue its rise as the fastest growing economy in the region at eight to 8.5 per cent in the next two years.

The survey, conducted by the UN Economic and Social Commission for Asia and the Pacific (UNESCAP), attributed the projected growth of Brunei mainly to a sustained increase in petroleum production in the coming years, amongst other factors. “Fiscal support, backed by substantial savings under the national wealth fund, will also continue to buoy the economy and provide employment,” it said.

“Nonetheless, the likely persistence of low global prices of oil and gas poses a considerable challenge for the country in the coming years,” it said.

The survey also reiterated the need for the sultanate to diversify the economy in the medium term to ensure its resilience and reduce its reliance on the energy sector.

“Aside from improving the business environment, the Brunei government needs to actively support the development of small and medium-sized enterprises through both public procurement and reducing the constraints of access to finance for businesses,” it said.

“The creation of the ASEAN Economic Community and the Trans-Pacific Partnership trade agreement, when ratified, would also open up more opportunities to attract investment into non-energy sectors, such as agro-processing, eco-tourism and financial services,” it said.

The survey noted that plans are already in place in Brunei to establish a stock market and create an Islamic bond (sukuk) market to boost syariah-compliant financial services.

Meanwhile, the survey projected the inflation rate in Brunei this year at 0.2 per cent and 0.4 per cent in 2017, after a deflation of 0.4 per cent in 2015.

The Brunei Times