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A Growing Industry in Brunei

| 04/11/2009 | Reply

Ensuring
domestic food security and developing a viable export sector are at the
heart of Brunei’s efforts to establish a strong commercial food
processing industry, though the country has to balance its staunch
commitment to environmental protection with the need to achieve
self-sufficiency in basic staples.

At present, Brunei
Darussalam’s agriculture only partially meets the country’s food needs,
with a small contribution to both employment and the economy, something
that may well change in the near future.

Last year, the total
output of Brunei Darussalam’s domestic food sector was just $158m,
though under a new strategy developed by the Department of Agriculture
this is to increase to $430m in 2013 and $1.9bn by 2023. While the
strategy aims to improve yields from farms, the emphasis is on growing
the agri-industry.

Speaking at the launch of the new strategy
on October 10, the industry and primary resources minister, Pehin Yahya
Bakar, said the challenge was to develop sustainability.

“I
wish to stress that the basis of agricultural development for the next
two decades will be directed at efforts to strengthen the capacity in
the agricultural sector, not only in increasing primary agricultural
commodity production sustainably, but more so in the development of the
capacity of the secondary sector, food processing, which will invite
more agri-business opportunities, locally and internationally,” he
said.

One of the cornerstones of Brunei Darussalam’s ambitions
is the Agro Technology Park to be located near the capital, a project
being developed on a 260-ha site to cater to the needs of the industry.
When operational in 2011, the park is expected to create up to 8000
jobs and combine research and logistics hubs alongside a processing
cluster. With the state contributing $140m and private investors
expected to match that, the project is one of the largest industrial
developments outside of the energy and petrochemicals sectors.

The
other building block on which the Sultanate’s food processing sector is
to be constructed is the state policy of supporting the halal food
industry, promoting the production of fresh and processed foods that
comply with the requirements of sharia laws.

Brunei Darussalam
officials have identified the growing demand for halal products, a
market that already represents around 12% of global food sales and
which is expected to increase to 30% by 2025, as an industrial niche
the Sultanate can help fill, both through testing and certifying
products from overseas through the Brunei Halal Brand and by expanding
domestic production.

Though Brunei Darussalam wants to boost
its agri-industrial base, along with the primary industries needed to
support it through the growing of raw materials, there are a number of
constraints that may restrict the scope of development. One of these is
a shortage of land.

Though the Agro Technology Park and other
smaller-scale projects are being developed to serve the food industry,
there is only a limited amount of land available for extending
agricultural production.

According to figures released by the
minister of development, Pehin Abdullah Bakar, on October 17, just 5%
of Brunei Darussalam’s land is listed as accessible for housing or
industrial purposes, with housing having the priority.

There
are only some 28,825 ha of the country’s total landmass of 576,500 ha
that has not been marked for preservation or that is already being
utilised, the minister said.

With some 17,000 applicants on
waiting lists for state housing, a figure that is expected to rise to
30,000 by 2012, the minister said care had to be taken to manage land
resources.

“So far, the nation’s housing scheme requires 5000
ha of land, which is 17% of the land available,” Pehin Abdullah said.
“This shows the need for us to use land more wisely.”

To
combat the lack of wide open spaces, Brunei Darussalam officials are
promoting the better use of what land is available, both through
utilising improved technology and techniques, and by focusing on crop
strains that are best suited to local conditions. One example of this
is the introduction of a specially developed high yield rice variety,
Bera Laila, part of the campaign to meet 20% of domestic rice demand by
2010, up from the current single-digit levels.

Another way
that Brunei Darussalam is looking at overcoming its deficit of primary
produce for processing is through imports, a strategy outlined by Abdul
Latif Sani, a senior official with the Department of Agriculture’s
Halal Development Division.

Brunei Darussalam was considering
forming partnerships with foreign firms to provide bulk raw materials
to be exported to the Sultanate where they could be processed so as to
meet halal standards, Abdul Latif told the Borneo Bulletin while
attending the sixth China-ASEAN Expo in late October.

“Basically
the objective is, as a Muslim nation, to provide halal food to Muslims
worldwide,” he said. “The second objective is that we are tapping into
the lucrative halal global market, which is believed to be worth
billions of US dollars. The third is that we want to take the small and
medium-sized enterprises’ products to explore the global halal market.”

While it will take time for Brunei Darussalam’s agri-industry
to fully get off the ground, having identified a potential growth
market, the government is putting in place the necessary capital and
infrastructure to sustain the sector’s development.

Category: Asia

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