By Dr Arno Maierbrugger,
Qatar has recently stepped up its effort to get engaged in investment opportunities in Sarawak, Malaysia’s largest state that reported GDP growth rates of around 5% in 2012
First of all, Qatar has recently reiterated its interest to invest in Sarawak’s halal hub at Tanjung Manis, with the production of halal gelatine, pharmaceuticals and food production among its identified industries. The move followed a meeting by Sarawak’s Chief Minister Abdul Taib Mahmud with Qatar’s Prime Minister HE Sheikh Hamad bin Jassim bin Jabor al-Thani to discuss possible Qatari direct investments in Sarawak at the Inside Asia Forum 2012 organised by Inside Investor in October 2012 in Doha. At the forum, Sheikh Hamad identified halal food production, halal fashion and halal cosmetics as possible investment targets for Qatari companies in Sarawak.
On March 6, acting Charge d’Affaires of the Qatari Embassy in Malaysia Rashid al-Mulla, who was on a working visit to Sarawak, said Qatar was now planning to build a hub in Doha where products manufactured in Sarawak would be exported to its capital for the Middle East market
In another move, the Qatari government has said it wants to have more interaction with Sarawak to further explore the potential for future co-operation in the local aviation industry. In particular, Qatar has set sight on Sarawak-based Hornbill Skyways whose services cover the entire state of Sarawak and parts of neighbouring Sabah.
Other possible investment of Qatar in Sarawak could take place in the palm oil sector, timber industry, aquaculture and aluminium.
Among the 13 states of the Malaysian federation, Sarawak has one of the strongest economies and is the only state to have an A-rating from Standard & Poor’s. Despite the global economic crisis, Sarawak has maintained a steady growth over the past few years.
The largely Muslim-dominated state represents an opportunity for Qatar as the economic structure of Sarawak is largely export oriented, with primary commodities dominating trade. Mining, agriculture and forestry contribute about 40% to the state’s total GDP, while secondary sectors like manufacturing and construction contribute slightly more than 30%.
Under the Tenth Malaysia Plan (2011-2015), $7.2bn has been pledged towards the development of Sarawak. Foreign direct investment net inflows stood at $10.6bn in 2011 as per latest available figures.
In Southeast Asia, Qatar has so far dished out capital to the Malaysian financial services industry, Singapore’s hospitality sector, farming projects in Thailand and Cambodia, tourism complexes in Myanmar and Laos and a planned mining project in the Philippines. Sarawak could be next in line.
*Our columnist Dr Arno Maierbrugger is Editor-in-Chief of www.investvine.com, a news portal owned by Inside Investor focusing on Southeast Asian economic topics as well as trade and investment relations between Asean and the GCC. The views expressed are his own.