Transcript Sabah Development Corridor 2008-2025
Slide 1
Sabah Development Corridor 2008-2025
Briefing
EU Economics & Commercial Counsellors
IDS Conference Room
14th May 2009
0
Slide 2
1.
Key development challenges:
•
High cost of doing business – poor infrastructure and high freight costs
•
Shortage of critical mass of human capital
•
Highest incidence of households living in poverty
2. High cost of doing business mainly due to high shipping costs and poor infrastructure
•
Shipping costs: low originating cargo, low ship call frequency and double handling
•
Unreliable electricity supply and shortage of water supply
•
Poor road and rail connectivity leading to high transportation costs
3. Shortage of talents in strategic sectors; and heavy dependence on foreign labour
4. Largely rural, with a poverty rate of 23% (6.5% hardcore poor).
5. Gross Domestic Product: Sabah’s GDP of RM15.1 Bn is 7th largest in Malaysia
6. GDP per capita in 2005: RM5,100 ; Malaysian average: RM9,800
7. Monthly household income in 2004: RM2,487; Malaysian average: RM3,249
8. Unemployment is currently at 5.8%; Current workforce is 1.198 million (2006),
9. Population: 3.1 million (2006)
10. Education: 79% of persons aged 6 and over attended school (national av: 90%)
Slide 3
Sabah Development Corridor 2008-2025:
The National Context: Issues and Benefits
•
Narrow-base of national export: too dependent on electronics, oil &
gas and palm oil
•
Relatively weak resource-based industries
•
Widening income inequality
•
Employment growth lagging behind economic growth
•
Relatively weak linkage between economic growth and poverty
incidence
•
Lack of human capital in strategic sectors
•
Heavy dependence on foreign labour in agriculture and construction
Slide 4
KLSE COMPOSITE INDEX: JANUARY-DECEMBER 2008
39% Decline over the period
Slide 5
WORLD ECONOMY ‘WEAKEST SINCE 30’s:
the United Nations
The United Nations says “the world economy faces its
worst downturn since the Great Depression... [and]
expects world economic output to shrink by as much
as 0.4% in 2009, due to a slump among developed
countries - particularly the US and in Europe. …
“This would mark the world economy's first year of
contraction since the 1930’s”
“The eurozone economy will
shrink 1.9% in 2009 and grow by
only 0.4% in 2010….”
(the European Commission, 2009)
(Source: the BBC)
Slide 6
Sabah Development Corridor 2008-2025
The vision for Sabah is to be a vibrant,
economically successful and liveable state
SDC is underpinned
by 3 key principles
•
Capture higher value economic
activities
•
Promote balanced economic growth
with distribution
•
Ensure sustainable growth via
environmental conservation
Phase 1 (2008-2010)
Phase 2 (2011-015)
Building the foundation
for growth
Accelerating
economic growth
Catalysing future growth via
infrastructure as well as high
economic impact and poverty
eradication projects
Higher order value-add
activities, the presence of global
companies and a strong base of
local SMEs
Phase 3 (2016-2025)
Expansion
An attractive destination for
FDIs with strong supporting
infrastructure, global companies
and knowledge workforce
Slide 7
January 2008
The vision for Sabah is to be a vibrant, economically
successful and liveable state by creating and articulating a
set of 5 unique attributes that will mould the future of Sabah:
•
A preferred gateway for trade, investment and leisure for leading
businesses and talent from around the world in key areas
•
A happy and cohesive community that lives in harmony and
prosperity regardless of race, language or religion
•
A tech-savvy state that uses and showcases technology in
enhancing quality of daily life
•
A place of opportunity where residents and foreign talents find
rewarding employment opportunities
•
Amongst the most liveable place in Asia with culture, heritage,
quality of life and clean environment
6
Slide 8
Sabah is blessed with excellent Location, Resources and
Bio-diversity which it can build on…
Location
Resources
Cultural and
Bio-diversity
• Gateway for regional trade
• Ideal for transhipment and value add for
cargo between Kalimantan–South Philippines
and North Asia (China, Japan, Korea)
• Capitalise on market deregulation of AFTA
• Rich in natural resources (oil & gas, fertile
agriculture land, minerals, forestry)
• Capture high value add downstream activities
such as oleo chemicals, gas processing plant,
oil refineries and wood based products
• Position Sabah as centre of excellence for
agriculture
• Rich bio-diversity (flora-fauna and marine life)
• 32 ethnic groups spawning diverse cultural
backgrounds
• Capture knowledge from international
researchers
• Stimulate biotech activities
7
Slide 9
Vision & Sectoral
Focus
Slide 10
SDC VISION
To be a leading economic region
in Asia by being the preferred gateway
for trade, investment and leisure
Physical
infrastructure
Structured
infrastructure
development in
transportation,
utilities and
communication to
enhance living
standards and
enable commercial
activities
Social
Environment
Sector-specific visions
Agriculture:
Services:
Manufacturing:
Highly
productive
Premier ecotourism
High value
jobs
Food selfsufficiency
Second
home
High value
add
downstream
Sustainable
and safe
Low cost of
business
Successful
pool of SMEs
Harmonious and
Cohesive society
Pristine and well
conserved
No Hardcore
Poverty
Soft
Infrastructure
Systematic skills
upgrading of
existing workforce
in key industries,
retain talented
Sabahans and
targeted import of
foreign talent in
professional and
managerial
positions
Confident and
Independent
Renowned
worldwide
9
Slide 11
Sabah Development Corridor is made up
of 3 sub-regions
Characteristics of Sabah Development Corridor
• SDC is made up of 3 sub-regions
– Western Sub-region: Kudat, Kota Belud,
Tuaran, Kota Kinabalu, Penampang, Papar,
Beaufort, Kuala Penyu, Sipitang
– Central Sub-region: Pitas, Kota Marudu,
Ranau, Tambunan, Keningau, Tenom,
Nabawan
– Eastern Sub-region: Sandakan, Beluran, Kota
Kinabatangan, Tongod, Lahad Datu, Kunak,
Kalabakan, Semporna, Tawau
• Sabah consists of 5 administrative divisions*,
subdivided into 24 sub-divisions (or districts)
• 32 officially recognised ethnic groups
• Area = 73,997 km2 (22.4% of Malaysia);
Population = 3.1 million**
* 1. West Cost Division: Kota Belud, Kota Kinabalu, Papar, Penampang, Ranau, Tuaran; 7,588 km2, popn.=953,900. 2. Interior Division:
Beaufort, Nabawan, Keningau, Kuala Penyu, Sipitang, Tambunan, Tenom; 18,298 km2, popn.=420,800. 3.Kudat Division: Kota Marudu,
Kudat, Pitas; 4,623 km2, popn.=189,500. 4.Sandakan Division: Beluran, Kinabatangan, Sandakan, Tongod; 28,205, popn.=676,000. 5.
Tawau Division: Kunak, Lahad Datu, Semporna, Tawau; 14,905km2, popn.=756,800
** Department of Statistics Malaysia (2006)
Source: IDS Concept Paper; Team analysis
10
Slide 12
Core Components of Sabah Development Corridor
Sub-Regions
11
Slide 13
CURRENT URBAN HIERARCHY AND
LINKAGES FOR SABAH
Sub-Regions
KUDAT (11):
27,443
KOTA BELUD (10):
31,001
TUARAN (8):
35,499
KOTA KINABALU (1):
RANAU (12):
Regional Growth Centre
22,425
323,817
PAPAR (6):
42,598
SANDAKAN (2): 268,821
Secondary Regional Growth
Centre
Penampang (4):
81,867
KENINGAU (9):
32,754
LAHAD DATU (5):
71,176
SEMPORNA (7):
41,624
TAWAU (3): 155,099
Sub-Regional Growth Centre
Slide 14
Sub-Regional
Growth Centre
Urban Growth
Centre
Sub-Regions
Rural Growth
Centre
KOTA KINABALU
CONURBATION
Regional Growth Centre
THE PROPOSED URBAN HIERARCHY
AND LINKAGES TO REDUCE SUBREGIONAL AND RURAL-URBAN GAP
Secondary Regional
Growth Centre
Sub-Regional
Growth Centre
Slide 15
Services
Tourism &
Logistics
Slide 16
TOURISM: Sabah’s beauty and rich cultural and bio diversity
Tropical Research
Centre of Excellence
ECO-CERTIFIED
Ecotourism
Eco-Certification
One District One
Product
ECO-CERTIFIED
Ecotourism
ECO-CERTIFIED
Ecotourism
Poring Hot
Spring Spa
Tropical Research
Field Station
Tourism Skills
Training Centre
ECO-CERTIFIED
Ecotourism
ECO-CERTIFIED
Ecotourism
ECO-CERTIFIED
Ecotourism
Maliau
Basin
Danum
Valley
ECO-CERTIFIED
Ecotourism
ECO-CERTIFIED
Ecotourism
Arts & Culture
Development Fund
Keningau Handicraft
Production Village
ECO-CERTIFIED
Ecotourism
ECO-CERTIFIED
Ecotourism
15
Slide 17
Four main strategies under the tourism sector...
Tourism Strategy
1
2
3
Rationale
Position Sabah as the
premier eco-adventure
destination
• Leveraging on Sabah’s natural endowment
• Tapping on fastest growing segment of tourism industry; ecotourism growth of 20% compared to 7% for overall tourism1
Develop new tourism
products anchored by
signature resorts
• Moving towards high-yield market
• Leveraging off their marketing efforts and loyal customer base
Market Sabah as the
exclusive holiday home
destination
• Increasing demand for exclusivity among the rich and famous –
Sabah is still largely undeveloped unlike Phuket and Bali
• Extending length of stay of high-end visitors
4
Encourage rural
participation through
community-based
tourism
1
• Enhancing rural income
• Encouraging entrepreneurship
The International Ecotourism Society, Ecotourism Fact Sheet (September 2005)
16
Slide 18
Agriculture
Slide 19
AGRICULTURE: Focus on food sustainability, high value
export to North Asia and poverty eradication
Bengkoka Rubber
Resettlement
(2,500 families)
Jatropha Site
Palm Biotech R&D
Centre
Integrated Collection
Centre
R&D Centre
Jelapang Padi
Programme
(7,000 families)
Permanent Food Crop
Production Parks
Upgraded fishery landing
sites
E
Sabah Agro-Industrial
Precinct
Sandakan Education hub
Aquaculture zones
E
National Marine
Aquaculture Centre
Seafood Terminal
Livestock cluster
Agrifood production
zones
Agrifood industrial
zones
Jatropha Pilot Site
Keningau Integrated
Livestock Centre
18
Slide 20
Three main strategies for the agricultural sector...
Agriculture Strategy
1
Develop high-value,
high-potential products
• To move towards high value markets
• Leveraging off the natural biodiversity strengths of Sabah from
both sea and land
• Potential enhancement via increased R&D and marketing
Enhance food-based
agriculture sub-sectors
• To reduce Sabah’s food import requirement
• To enhance involvement and income of rural community
• Potential enhancement via increased technical and financial
support
Position Sabah as the
centre of excellence for
oil palm
• Sabah is the single largest contributor to the oil palm industry
in Malaysia
• Sabah has high potential in downstream activities for palm oil
2
3
Rationale
19
Slide 21
Manufacturing
Slide 22
MANUFACTURING: Sabah will focus on leveraging its
natural resources as feedstock to capture value in
downstream activities
Wood-Based Industry
Cluster
Industrial Corridor
POIC Sandakan
Sabah Oil and Gas
Terminal
Minerals Based
Industry
Energy Intensive
Cluster
POIC Lahad Datu
21
Slide 23
MANUFACTURING: Integrated Petrochemical Complex at the Kimanis
landing site will generate RM5bn of private investments and create high
value jobs
…to an integrated gas or petrochemical complex,
attracting investments and spawning high value jobs
From landing site…
Export
Natural
gas
LPG bottling
plant
Hydrogen
peroxide
Stabilisation
unit
Condensate
Crude
oil
LPG
Tank farm
Slug catcher
and gas
conditioning
Gas
Ammonia/
urea
Off gas
GPP
Future
NPK plant
300MW
Power
plant
Compressor station
Gas pipe to Bintulu LNG plant
Source: Interviews with Oil & Gas expert
22
Slide 24
Three main strategies for manufacturing sector...
Manufacturing Strategy
1
Enhance basic
infrastructure, focus on
reducing cost of doing
business
• Basic infrastructure is crucial to operational efficiencies of
manufacturers
• Cost of doing business is fundamental to investors’ choice of
location
Invest in human capital
for existing and new
industries
• Skilled manpower is key to manufacturing competitiveness
• Systematic approach to matching industry needs with supply of
human capital via fine-tuning current education and training
courses
Attract world class
companies in high
value add downstream
activities
• Leverage Sabah’s natural resources as feedstock raw
materials
• Elevate the standards of local SMEs supplying to world class
companies
• Serve as a draw for talent and quality FDIs (management and
technical knowhow) into Sabah
2
3
Rationale
23
Slide 25
Infrastructure
and Human Capital
Slide 26
INFRASTRUCTURE
SDC infrastructure vision
Key targets by 2025
1
CONNECT SABAH
• 61% of all roads are still gravel & earth roads
Ensure connectivity to enable • 80% of all gravel roads to be sealed by 2025
productivity via roads, rail, sea • Focus on enabling intercity connectivity and SDC
and air
projects
2
POWER UP SABAH
Provide sufficient & reliable
electricity for Sabah
•
•
•
•
3
QUENCH SABAH’S THIRST
Provide sufficient water to
keep pace with demand
• Current demand outstrips supply by 23%
• Supply to meet demand by 2010
• Reduce NRW from current levels of 57% to 25% by
2025
4
EMBRACE TECHNOLOGY
Enhance data connectivity
• Current broadband penetration is 4.9%
• 65% of population connected by 2025
• Enable businesses and move towards a knowledge
based economy
5
• 3.95% of population with tertiary education in 2000
INVEST IN SABAH’S
• 15% of population with tertiary education by 2025
TALENT
Build human capital to provide • Using companies and MNCs to develop talent
skilled talent pool
Current coverage is 67%
90% of population covered by 2010
Enhance rural electrification
Increase capacity and strengthen grid
25
Slide 27
Environment
Slide 28
Adventure Experience…
of Pristine Wilderness in Primeval Rain Forests
Mt. Kinabalu
Mt.
Tambayukon
Mt. Trusmadi
Crocker Range
Danum Valley
Imbak Canyon
Maliau Basin
‘Sabah’s Lost World’
Nature at its Best
Heart of Borneo
Slide 29
ENVIRONMENT: Conservation is necessary to preserve our heritage,
boost tourism and export of agriculture related products
Education and awareness
• Educate public on recycling,
cleanliness, conservation of
biodiversity, preservation of
clean river system, etc.
Infrastructure
• Manage sewage and solid
waste
• Protect settlements, river
systems, mangrove
Forests
• Clearly demarcate boundaries and
regulate forest reserves
• Restore degraded forests
By 2025,
most liveable
place in Asia
Biodiversity
• Preserve marine and
wildlife
• Preserve flora and fauna
• G2G agreements on
protection of highly
migratory species
Physical conservation
• Shoreline management
• Conserve World Heritage
sites
Sustainable development
• Promote certification of agriculture
produce to comply with credible
sustainable standards (s.a. RSPO)
Source: Team analysis
28
Slide 30
Implementation &
Expectation
Slide 31
Key tenets need to be in place for SEDIA to have the best chance to
successfully deliver the programmes planned in the SDC Blueprint
Key tenets for SEDIA
• The Sabah Economic Development
and Investment Authority (SEDIA)
Enactment 2009
Measure of
successful
implementation
• Joint Working teams comprising of
federal and state agencies to expedite
approvals
• Commitment and obligation on all
Impactful programmes
Targeted resource delivery
Balanced socio-economic
parties concerned to meet set service
levels
• Permanency to stay the course of the
Blueprint
• Right management structure and
enablers
30
Slide 32
SDC INVESTORS
“The government will put in place
policies to make it easier to do
business here ... We will not
compromise on the environment
and our culture"-
SEDIA
DATUK SERI PANGLIMA MUSA AMAN
Company
Registration
Licence
Approval
Work
Permits
Land
Matters
Planning
Approvals
Utility
Approvals
Incentives
Slide 33
Mega biodiversity, relatively unaffected by
the Ice Age
Kinabalu Park – Malaysia’s first World
Heritage Site (UNESCO: Dec, 2000)
Danum Valley Research Centre and Sepilok
Orang Utan Rehabilitation Centre
Islands (esp. Sipadan), Maliau Basin, Tabin
Wildlife, Caves (Gomantong & Madai)
Valuable ethnobotanical knowledge from
the indigenous communities
Infrapro & Deramakot (since 1992,FSC cert.)
carbon sequestration model
Multi-racial society with rich cultural
heritage (Tingkayu Valley archeological
sites
Largest oil palm plantation area in Malaysia;
Fertile soil, adequate rainfall and conducive
climate
Relatively clean and unpolluted natural
environment
Livestocks free from foot and mouth
disease
Access to deep water and sheltered ports
Moves the economy up the value chain and
promotes economic growth by optimising
the utilisation of Sabah’s factor
endowments, locational advantages and
competencies
Rationalises the spatial distribution of
Sabah’s population and facilitates the
integration of Sabah sub-regional
economies, thereby reducing regional
imbalance
Enhances human capital thereby improving
the quality of life and thus reducing social
imbalances
Attracts private investments, tourists,
highly skilled workers as well as scientific
researchers
Offers Sabah and Malaysia generally, to
participate in the vibrant knowledge-based
economy driven by S&T convergence
Reduces poverty by creating new business
and employment opportunities
Slide 34
“Big ticket” items for remaining 9MP*
• Roads
• Replicate Agropolitan
• Sea Port
• POICs (Sandakan and Lahad Datu)
• Human Capital: Sandakan Education Hub
• Biodiversity Conservation: Heart of Borneo, wildlife, marine eco-syst
• Agri-Business Accelerator: eg SAIP, Integrated Fisheries Compl
• AgriExcel Outreach: Food Security and High Value Crops
• Direct assistance (hardcore)
• Tropical Biodiversity Research: Sabah Bio-X
• Mini Estet Sejahtera (MESEJ)
Slide 35
1.
2.
3.
4.
Tourism targets
•
Increase average tourist spending from RM2,517 in 2006 to RM3,383 by 2012 and RM5,364 by 2025
•
Increase tourism receipts from RM2.88 billion in 2006 to RM8 billion by 2012 and RM48.5 billion by
2025
•
Increase rural community tourism receipts (handicrafts and homestay) from RM139 million in 2006
to RM 432 million by 2012 and RM4.5 billion by 2025
Agriculture targets
•
Multiply GDP contribution by 4.1 times from RM4.1 billion to RM 17 billion by 2025
•
Increase total value of exports from RM9.1 billion to RM60 billion
•
Reduce negative balance of trade of food by 60% from RM955 million to RM353 million
Manufacturing targets
•
Increase capital investments from RM208 million (2006) to RM2.96 billion by 2025
•
Enhance employment in manufacturing sector from 135,000 to 228,704 by 2025
•
Increase proportion of manufacturing workforce with tertiary education from under 10% (2005) to
45% by 2025
Infrastructure targets
•
Roads: all major towns and rural collection centres are connected by sealed roads
•
Electricity: 90% of population is connected with SAIDI of 500 minutes (from 2,540 currently)
•
Water: Reduce NRW from 57% to 25% and increase capacity to meet supply
•
Data connectivity: Broadband penetration of 35 per 100 inhabitants from 4.9 currently
•
Talent: Skilled talent pool for all targeted industries in Sabah
Slide 36
Expected Outcome
Enhancing The Quality Of Life, And Reducing Regional Imbalance
And Poverty Incidence In A Sustainable Manner
HUMAN
CAPITAL
DEVELOPMENT
PRODUCTION
AREAS
FACTOR
ENDOWMENT
BASIC INFRA.
UTILITIES &
SERVICES
INCENTIVE
SCHEMES TO
ATTRACT
INVESTORS
IMPROVE
RURAL-URBAN
LINKAGES
ENHANCE SUPPLY
CHAIN EFFICIENCY
ATTRACT
INVESTMENTS TO
TARGETTED AREAS
AND ECONOMIC
SECTORS
OPEN UP NEW
ECONOMIC
OPPORTUNITIES:
THE PRODUCTION
POSSIBILITY
FRONTIERS
CREATING
EMPLOYMENT
OPPORTUNITIES
BUSINESS
OPPORTUNITIES
FOR
FARMERS
BUSINESS
OPPORTUNITIES
FOR
SMEs
BUSINESS
OPPORTUNITIES
FOR LARGE
CORP & GLCs
REDUCE POVERTY
HIGHER
QUALITY
OF LIFE
EXPEDITE
ECONOMIC
GROWTH
REDUCING
RURAL-URBAN
GAP: REDUCING
RURAL-URBAN
MIGRATION
REGIONAL
BALANCE
REDUCING
INCOME
INEQUALITIES
SUSTAINABLE
DEVELOPMENT
Slide 37
With SDC
Sabah GDP per Capita (1987 constant prices) (RM)
9MP growth target
16,000
14,784
2.9x
14,000
12,000
11,363
10,000
8,000
6,000
5,100
4,000
2,000
0
2005
GDP
(RM’bn)
15.1
2006
2007
2008
2009
2010
21.9
20.3
2011
2012
2013
2014
2015
32.0
27.1
2016
2017
2018
2019
2020
45.7
36.3
2021
2022
2023
2024
2025
63.2
48.6
* ADB forecast a growth of 5.5% for Malaysia for 2006-2010. Constant growth is based on 6% in line with 9MP. SDC model in Appendix
Source: Team analysis; Asian Development Outlook 2006
36
Slide 38
Thank You
******INSTITUTE FOR DEVELOPMENT STUDIES SABAH ******
Sabah Development Corridor 2008-2025
Briefing
EU Economics & Commercial Counsellors
IDS Conference Room
14th May 2009
0
Slide 2
1.
Key development challenges:
•
High cost of doing business – poor infrastructure and high freight costs
•
Shortage of critical mass of human capital
•
Highest incidence of households living in poverty
2. High cost of doing business mainly due to high shipping costs and poor infrastructure
•
Shipping costs: low originating cargo, low ship call frequency and double handling
•
Unreliable electricity supply and shortage of water supply
•
Poor road and rail connectivity leading to high transportation costs
3. Shortage of talents in strategic sectors; and heavy dependence on foreign labour
4. Largely rural, with a poverty rate of 23% (6.5% hardcore poor).
5. Gross Domestic Product: Sabah’s GDP of RM15.1 Bn is 7th largest in Malaysia
6. GDP per capita in 2005: RM5,100 ; Malaysian average: RM9,800
7. Monthly household income in 2004: RM2,487; Malaysian average: RM3,249
8. Unemployment is currently at 5.8%; Current workforce is 1.198 million (2006),
9. Population: 3.1 million (2006)
10. Education: 79% of persons aged 6 and over attended school (national av: 90%)
Slide 3
Sabah Development Corridor 2008-2025:
The National Context: Issues and Benefits
•
Narrow-base of national export: too dependent on electronics, oil &
gas and palm oil
•
Relatively weak resource-based industries
•
Widening income inequality
•
Employment growth lagging behind economic growth
•
Relatively weak linkage between economic growth and poverty
incidence
•
Lack of human capital in strategic sectors
•
Heavy dependence on foreign labour in agriculture and construction
Slide 4
KLSE COMPOSITE INDEX: JANUARY-DECEMBER 2008
39% Decline over the period
Slide 5
WORLD ECONOMY ‘WEAKEST SINCE 30’s:
the United Nations
The United Nations says “the world economy faces its
worst downturn since the Great Depression... [and]
expects world economic output to shrink by as much
as 0.4% in 2009, due to a slump among developed
countries - particularly the US and in Europe. …
“This would mark the world economy's first year of
contraction since the 1930’s”
“The eurozone economy will
shrink 1.9% in 2009 and grow by
only 0.4% in 2010….”
(the European Commission, 2009)
(Source: the BBC)
Slide 6
Sabah Development Corridor 2008-2025
The vision for Sabah is to be a vibrant,
economically successful and liveable state
SDC is underpinned
by 3 key principles
•
Capture higher value economic
activities
•
Promote balanced economic growth
with distribution
•
Ensure sustainable growth via
environmental conservation
Phase 1 (2008-2010)
Phase 2 (2011-015)
Building the foundation
for growth
Accelerating
economic growth
Catalysing future growth via
infrastructure as well as high
economic impact and poverty
eradication projects
Higher order value-add
activities, the presence of global
companies and a strong base of
local SMEs
Phase 3 (2016-2025)
Expansion
An attractive destination for
FDIs with strong supporting
infrastructure, global companies
and knowledge workforce
Slide 7
January 2008
The vision for Sabah is to be a vibrant, economically
successful and liveable state by creating and articulating a
set of 5 unique attributes that will mould the future of Sabah:
•
A preferred gateway for trade, investment and leisure for leading
businesses and talent from around the world in key areas
•
A happy and cohesive community that lives in harmony and
prosperity regardless of race, language or religion
•
A tech-savvy state that uses and showcases technology in
enhancing quality of daily life
•
A place of opportunity where residents and foreign talents find
rewarding employment opportunities
•
Amongst the most liveable place in Asia with culture, heritage,
quality of life and clean environment
6
Slide 8
Sabah is blessed with excellent Location, Resources and
Bio-diversity which it can build on…
Location
Resources
Cultural and
Bio-diversity
• Gateway for regional trade
• Ideal for transhipment and value add for
cargo between Kalimantan–South Philippines
and North Asia (China, Japan, Korea)
• Capitalise on market deregulation of AFTA
• Rich in natural resources (oil & gas, fertile
agriculture land, minerals, forestry)
• Capture high value add downstream activities
such as oleo chemicals, gas processing plant,
oil refineries and wood based products
• Position Sabah as centre of excellence for
agriculture
• Rich bio-diversity (flora-fauna and marine life)
• 32 ethnic groups spawning diverse cultural
backgrounds
• Capture knowledge from international
researchers
• Stimulate biotech activities
7
Slide 9
Vision & Sectoral
Focus
Slide 10
SDC VISION
To be a leading economic region
in Asia by being the preferred gateway
for trade, investment and leisure
Physical
infrastructure
Structured
infrastructure
development in
transportation,
utilities and
communication to
enhance living
standards and
enable commercial
activities
Social
Environment
Sector-specific visions
Agriculture:
Services:
Manufacturing:
Highly
productive
Premier ecotourism
High value
jobs
Food selfsufficiency
Second
home
High value
add
downstream
Sustainable
and safe
Low cost of
business
Successful
pool of SMEs
Harmonious and
Cohesive society
Pristine and well
conserved
No Hardcore
Poverty
Soft
Infrastructure
Systematic skills
upgrading of
existing workforce
in key industries,
retain talented
Sabahans and
targeted import of
foreign talent in
professional and
managerial
positions
Confident and
Independent
Renowned
worldwide
9
Slide 11
Sabah Development Corridor is made up
of 3 sub-regions
Characteristics of Sabah Development Corridor
• SDC is made up of 3 sub-regions
– Western Sub-region: Kudat, Kota Belud,
Tuaran, Kota Kinabalu, Penampang, Papar,
Beaufort, Kuala Penyu, Sipitang
– Central Sub-region: Pitas, Kota Marudu,
Ranau, Tambunan, Keningau, Tenom,
Nabawan
– Eastern Sub-region: Sandakan, Beluran, Kota
Kinabatangan, Tongod, Lahad Datu, Kunak,
Kalabakan, Semporna, Tawau
• Sabah consists of 5 administrative divisions*,
subdivided into 24 sub-divisions (or districts)
• 32 officially recognised ethnic groups
• Area = 73,997 km2 (22.4% of Malaysia);
Population = 3.1 million**
* 1. West Cost Division: Kota Belud, Kota Kinabalu, Papar, Penampang, Ranau, Tuaran; 7,588 km2, popn.=953,900. 2. Interior Division:
Beaufort, Nabawan, Keningau, Kuala Penyu, Sipitang, Tambunan, Tenom; 18,298 km2, popn.=420,800. 3.Kudat Division: Kota Marudu,
Kudat, Pitas; 4,623 km2, popn.=189,500. 4.Sandakan Division: Beluran, Kinabatangan, Sandakan, Tongod; 28,205, popn.=676,000. 5.
Tawau Division: Kunak, Lahad Datu, Semporna, Tawau; 14,905km2, popn.=756,800
** Department of Statistics Malaysia (2006)
Source: IDS Concept Paper; Team analysis
10
Slide 12
Core Components of Sabah Development Corridor
Sub-Regions
11
Slide 13
CURRENT URBAN HIERARCHY AND
LINKAGES FOR SABAH
Sub-Regions
KUDAT (11):
27,443
KOTA BELUD (10):
31,001
TUARAN (8):
35,499
KOTA KINABALU (1):
RANAU (12):
Regional Growth Centre
22,425
323,817
PAPAR (6):
42,598
SANDAKAN (2): 268,821
Secondary Regional Growth
Centre
Penampang (4):
81,867
KENINGAU (9):
32,754
LAHAD DATU (5):
71,176
SEMPORNA (7):
41,624
TAWAU (3): 155,099
Sub-Regional Growth Centre
Slide 14
Sub-Regional
Growth Centre
Urban Growth
Centre
Sub-Regions
Rural Growth
Centre
KOTA KINABALU
CONURBATION
Regional Growth Centre
THE PROPOSED URBAN HIERARCHY
AND LINKAGES TO REDUCE SUBREGIONAL AND RURAL-URBAN GAP
Secondary Regional
Growth Centre
Sub-Regional
Growth Centre
Slide 15
Services
Tourism &
Logistics
Slide 16
TOURISM: Sabah’s beauty and rich cultural and bio diversity
Tropical Research
Centre of Excellence
ECO-CERTIFIED
Ecotourism
Eco-Certification
One District One
Product
ECO-CERTIFIED
Ecotourism
ECO-CERTIFIED
Ecotourism
Poring Hot
Spring Spa
Tropical Research
Field Station
Tourism Skills
Training Centre
ECO-CERTIFIED
Ecotourism
ECO-CERTIFIED
Ecotourism
ECO-CERTIFIED
Ecotourism
Maliau
Basin
Danum
Valley
ECO-CERTIFIED
Ecotourism
ECO-CERTIFIED
Ecotourism
Arts & Culture
Development Fund
Keningau Handicraft
Production Village
ECO-CERTIFIED
Ecotourism
ECO-CERTIFIED
Ecotourism
15
Slide 17
Four main strategies under the tourism sector...
Tourism Strategy
1
2
3
Rationale
Position Sabah as the
premier eco-adventure
destination
• Leveraging on Sabah’s natural endowment
• Tapping on fastest growing segment of tourism industry; ecotourism growth of 20% compared to 7% for overall tourism1
Develop new tourism
products anchored by
signature resorts
• Moving towards high-yield market
• Leveraging off their marketing efforts and loyal customer base
Market Sabah as the
exclusive holiday home
destination
• Increasing demand for exclusivity among the rich and famous –
Sabah is still largely undeveloped unlike Phuket and Bali
• Extending length of stay of high-end visitors
4
Encourage rural
participation through
community-based
tourism
1
• Enhancing rural income
• Encouraging entrepreneurship
The International Ecotourism Society, Ecotourism Fact Sheet (September 2005)
16
Slide 18
Agriculture
Slide 19
AGRICULTURE: Focus on food sustainability, high value
export to North Asia and poverty eradication
Bengkoka Rubber
Resettlement
(2,500 families)
Jatropha Site
Palm Biotech R&D
Centre
Integrated Collection
Centre
R&D Centre
Jelapang Padi
Programme
(7,000 families)
Permanent Food Crop
Production Parks
Upgraded fishery landing
sites
E
Sabah Agro-Industrial
Precinct
Sandakan Education hub
Aquaculture zones
E
National Marine
Aquaculture Centre
Seafood Terminal
Livestock cluster
Agrifood production
zones
Agrifood industrial
zones
Jatropha Pilot Site
Keningau Integrated
Livestock Centre
18
Slide 20
Three main strategies for the agricultural sector...
Agriculture Strategy
1
Develop high-value,
high-potential products
• To move towards high value markets
• Leveraging off the natural biodiversity strengths of Sabah from
both sea and land
• Potential enhancement via increased R&D and marketing
Enhance food-based
agriculture sub-sectors
• To reduce Sabah’s food import requirement
• To enhance involvement and income of rural community
• Potential enhancement via increased technical and financial
support
Position Sabah as the
centre of excellence for
oil palm
• Sabah is the single largest contributor to the oil palm industry
in Malaysia
• Sabah has high potential in downstream activities for palm oil
2
3
Rationale
19
Slide 21
Manufacturing
Slide 22
MANUFACTURING: Sabah will focus on leveraging its
natural resources as feedstock to capture value in
downstream activities
Wood-Based Industry
Cluster
Industrial Corridor
POIC Sandakan
Sabah Oil and Gas
Terminal
Minerals Based
Industry
Energy Intensive
Cluster
POIC Lahad Datu
21
Slide 23
MANUFACTURING: Integrated Petrochemical Complex at the Kimanis
landing site will generate RM5bn of private investments and create high
value jobs
…to an integrated gas or petrochemical complex,
attracting investments and spawning high value jobs
From landing site…
Export
Natural
gas
LPG bottling
plant
Hydrogen
peroxide
Stabilisation
unit
Condensate
Crude
oil
LPG
Tank farm
Slug catcher
and gas
conditioning
Gas
Ammonia/
urea
Off gas
GPP
Future
NPK plant
300MW
Power
plant
Compressor station
Gas pipe to Bintulu LNG plant
Source: Interviews with Oil & Gas expert
22
Slide 24
Three main strategies for manufacturing sector...
Manufacturing Strategy
1
Enhance basic
infrastructure, focus on
reducing cost of doing
business
• Basic infrastructure is crucial to operational efficiencies of
manufacturers
• Cost of doing business is fundamental to investors’ choice of
location
Invest in human capital
for existing and new
industries
• Skilled manpower is key to manufacturing competitiveness
• Systematic approach to matching industry needs with supply of
human capital via fine-tuning current education and training
courses
Attract world class
companies in high
value add downstream
activities
• Leverage Sabah’s natural resources as feedstock raw
materials
• Elevate the standards of local SMEs supplying to world class
companies
• Serve as a draw for talent and quality FDIs (management and
technical knowhow) into Sabah
2
3
Rationale
23
Slide 25
Infrastructure
and Human Capital
Slide 26
INFRASTRUCTURE
SDC infrastructure vision
Key targets by 2025
1
CONNECT SABAH
• 61% of all roads are still gravel & earth roads
Ensure connectivity to enable • 80% of all gravel roads to be sealed by 2025
productivity via roads, rail, sea • Focus on enabling intercity connectivity and SDC
and air
projects
2
POWER UP SABAH
Provide sufficient & reliable
electricity for Sabah
•
•
•
•
3
QUENCH SABAH’S THIRST
Provide sufficient water to
keep pace with demand
• Current demand outstrips supply by 23%
• Supply to meet demand by 2010
• Reduce NRW from current levels of 57% to 25% by
2025
4
EMBRACE TECHNOLOGY
Enhance data connectivity
• Current broadband penetration is 4.9%
• 65% of population connected by 2025
• Enable businesses and move towards a knowledge
based economy
5
• 3.95% of population with tertiary education in 2000
INVEST IN SABAH’S
• 15% of population with tertiary education by 2025
TALENT
Build human capital to provide • Using companies and MNCs to develop talent
skilled talent pool
Current coverage is 67%
90% of population covered by 2010
Enhance rural electrification
Increase capacity and strengthen grid
25
Slide 27
Environment
Slide 28
Adventure Experience…
of Pristine Wilderness in Primeval Rain Forests
Mt. Kinabalu
Mt.
Tambayukon
Mt. Trusmadi
Crocker Range
Danum Valley
Imbak Canyon
Maliau Basin
‘Sabah’s Lost World’
Nature at its Best
Heart of Borneo
Slide 29
ENVIRONMENT: Conservation is necessary to preserve our heritage,
boost tourism and export of agriculture related products
Education and awareness
• Educate public on recycling,
cleanliness, conservation of
biodiversity, preservation of
clean river system, etc.
Infrastructure
• Manage sewage and solid
waste
• Protect settlements, river
systems, mangrove
Forests
• Clearly demarcate boundaries and
regulate forest reserves
• Restore degraded forests
By 2025,
most liveable
place in Asia
Biodiversity
• Preserve marine and
wildlife
• Preserve flora and fauna
• G2G agreements on
protection of highly
migratory species
Physical conservation
• Shoreline management
• Conserve World Heritage
sites
Sustainable development
• Promote certification of agriculture
produce to comply with credible
sustainable standards (s.a. RSPO)
Source: Team analysis
28
Slide 30
Implementation &
Expectation
Slide 31
Key tenets need to be in place for SEDIA to have the best chance to
successfully deliver the programmes planned in the SDC Blueprint
Key tenets for SEDIA
• The Sabah Economic Development
and Investment Authority (SEDIA)
Enactment 2009
Measure of
successful
implementation
• Joint Working teams comprising of
federal and state agencies to expedite
approvals
• Commitment and obligation on all
Impactful programmes
Targeted resource delivery
Balanced socio-economic
parties concerned to meet set service
levels
• Permanency to stay the course of the
Blueprint
• Right management structure and
enablers
30
Slide 32
SDC INVESTORS
“The government will put in place
policies to make it easier to do
business here ... We will not
compromise on the environment
and our culture"-
SEDIA
DATUK SERI PANGLIMA MUSA AMAN
Company
Registration
Licence
Approval
Work
Permits
Land
Matters
Planning
Approvals
Utility
Approvals
Incentives
Slide 33
Mega biodiversity, relatively unaffected by
the Ice Age
Kinabalu Park – Malaysia’s first World
Heritage Site (UNESCO: Dec, 2000)
Danum Valley Research Centre and Sepilok
Orang Utan Rehabilitation Centre
Islands (esp. Sipadan), Maliau Basin, Tabin
Wildlife, Caves (Gomantong & Madai)
Valuable ethnobotanical knowledge from
the indigenous communities
Infrapro & Deramakot (since 1992,FSC cert.)
carbon sequestration model
Multi-racial society with rich cultural
heritage (Tingkayu Valley archeological
sites
Largest oil palm plantation area in Malaysia;
Fertile soil, adequate rainfall and conducive
climate
Relatively clean and unpolluted natural
environment
Livestocks free from foot and mouth
disease
Access to deep water and sheltered ports
Moves the economy up the value chain and
promotes economic growth by optimising
the utilisation of Sabah’s factor
endowments, locational advantages and
competencies
Rationalises the spatial distribution of
Sabah’s population and facilitates the
integration of Sabah sub-regional
economies, thereby reducing regional
imbalance
Enhances human capital thereby improving
the quality of life and thus reducing social
imbalances
Attracts private investments, tourists,
highly skilled workers as well as scientific
researchers
Offers Sabah and Malaysia generally, to
participate in the vibrant knowledge-based
economy driven by S&T convergence
Reduces poverty by creating new business
and employment opportunities
Slide 34
“Big ticket” items for remaining 9MP*
• Roads
• Replicate Agropolitan
• Sea Port
• POICs (Sandakan and Lahad Datu)
• Human Capital: Sandakan Education Hub
• Biodiversity Conservation: Heart of Borneo, wildlife, marine eco-syst
• Agri-Business Accelerator: eg SAIP, Integrated Fisheries Compl
• AgriExcel Outreach: Food Security and High Value Crops
• Direct assistance (hardcore)
• Tropical Biodiversity Research: Sabah Bio-X
• Mini Estet Sejahtera (MESEJ)
Slide 35
1.
2.
3.
4.
Tourism targets
•
Increase average tourist spending from RM2,517 in 2006 to RM3,383 by 2012 and RM5,364 by 2025
•
Increase tourism receipts from RM2.88 billion in 2006 to RM8 billion by 2012 and RM48.5 billion by
2025
•
Increase rural community tourism receipts (handicrafts and homestay) from RM139 million in 2006
to RM 432 million by 2012 and RM4.5 billion by 2025
Agriculture targets
•
Multiply GDP contribution by 4.1 times from RM4.1 billion to RM 17 billion by 2025
•
Increase total value of exports from RM9.1 billion to RM60 billion
•
Reduce negative balance of trade of food by 60% from RM955 million to RM353 million
Manufacturing targets
•
Increase capital investments from RM208 million (2006) to RM2.96 billion by 2025
•
Enhance employment in manufacturing sector from 135,000 to 228,704 by 2025
•
Increase proportion of manufacturing workforce with tertiary education from under 10% (2005) to
45% by 2025
Infrastructure targets
•
Roads: all major towns and rural collection centres are connected by sealed roads
•
Electricity: 90% of population is connected with SAIDI of 500 minutes (from 2,540 currently)
•
Water: Reduce NRW from 57% to 25% and increase capacity to meet supply
•
Data connectivity: Broadband penetration of 35 per 100 inhabitants from 4.9 currently
•
Talent: Skilled talent pool for all targeted industries in Sabah
Slide 36
Expected Outcome
Enhancing The Quality Of Life, And Reducing Regional Imbalance
And Poverty Incidence In A Sustainable Manner
HUMAN
CAPITAL
DEVELOPMENT
PRODUCTION
AREAS
FACTOR
ENDOWMENT
BASIC INFRA.
UTILITIES &
SERVICES
INCENTIVE
SCHEMES TO
ATTRACT
INVESTORS
IMPROVE
RURAL-URBAN
LINKAGES
ENHANCE SUPPLY
CHAIN EFFICIENCY
ATTRACT
INVESTMENTS TO
TARGETTED AREAS
AND ECONOMIC
SECTORS
OPEN UP NEW
ECONOMIC
OPPORTUNITIES:
THE PRODUCTION
POSSIBILITY
FRONTIERS
CREATING
EMPLOYMENT
OPPORTUNITIES
BUSINESS
OPPORTUNITIES
FOR
FARMERS
BUSINESS
OPPORTUNITIES
FOR
SMEs
BUSINESS
OPPORTUNITIES
FOR LARGE
CORP & GLCs
REDUCE POVERTY
HIGHER
QUALITY
OF LIFE
EXPEDITE
ECONOMIC
GROWTH
REDUCING
RURAL-URBAN
GAP: REDUCING
RURAL-URBAN
MIGRATION
REGIONAL
BALANCE
REDUCING
INCOME
INEQUALITIES
SUSTAINABLE
DEVELOPMENT
Slide 37
With SDC
Sabah GDP per Capita (1987 constant prices) (RM)
9MP growth target
16,000
14,784
2.9x
14,000
12,000
11,363
10,000
8,000
6,000
5,100
4,000
2,000
0
2005
GDP
(RM’bn)
15.1
2006
2007
2008
2009
2010
21.9
20.3
2011
2012
2013
2014
2015
32.0
27.1
2016
2017
2018
2019
2020
45.7
36.3
2021
2022
2023
2024
2025
63.2
48.6
* ADB forecast a growth of 5.5% for Malaysia for 2006-2010. Constant growth is based on 6% in line with 9MP. SDC model in Appendix
Source: Team analysis; Asian Development Outlook 2006
36
Slide 38
Thank You
******INSTITUTE FOR DEVELOPMENT STUDIES SABAH ******