A hardworking year to improve state economy

MILESTONE: Abang Johari (third right) unveils the DBOS logo, witnessed by (from right) Deputy Chief Minister III Datuk Amar Awang Tengah Ali Hasan, Morshidi, Deputy Chief Minister I Datuk Amar Douglas Uggah Embas, former deputy chief minister Datuk Patinggi Tan Sri Alfred Jabu and Second Finance Minister Dato Sri Wong Soon Koh. — Photo by Chimon Upon

DATUK Patinggi Abang Johari Tun Openg has gone all out to transform Sarawak’s economy over the past one year – and his efforts are paying off.

His ‘Digital Economy’ master plan headlines the initiatives to connect Sarawakians regardless of distance and geography.

“I have been entrusted to lead and I will continue to complete the jobs left to me, but at the same time, I bring in new development policies.

“Digital economy will bring Sarawak forward,” the chief minister, who is also Parti Pesaka Bumiputera Bersatu (PBB) president, spoke at the party’s Zone 9 triennial delegates meeting in Bintulu last November.

He acknowledged that his predecessors had contributed vastly to the state’s growth – now is his time to bring new dimension to Sarawak economy by focusing on technology not only in the urban, but also in the rural areas.

This zeal was solidified last December when Abang Johari launched the Sarawak Multimedia Authority (SMA) and unveiled the first version of the Sarawak Digital Economy Strategy Book 2018-2022 – heralding the start of digital transformation of ‘Bumi Kenyalang’, the ‘Land of the Hornbills’.

SMA, as the key authority of Sarawak’s digital economy transformation, serves to oversee and regulate the digital strategies and initiatives of the state.

The Sarawak Digital Economy Strategy 2018-2022 is a document that spells out the vision, mission and 47 strategic actions to be implemented and improved as they go along the digital economy journey.

“Year 2030 is the year we want Sarawak to be a developed state in Malaysia, one with high-income economy. There must not be any rural and urban divide by then; hence, digital connectivity is important,” he said.

Abang Johari said to achieve this goal, Sarawak had no other options other than being bold enough, facing the reality and taking the risks to leapfrog its development plan.

 

“We have not even reached 3.0 Industrial Revolution and yet we want to reach 4.0 Revolution. We have to bypass the 3.0. Looking at the talents of Sarawakians and with our fighting spirit including a strong civil service, I have the conviction that we can bypass 3.0 and achieve 4.0 Industrial Revolution.

“With these comprehensive strategies and action plans, I am very confident that our digital economic developments are progressing towards the right direction,” he assured Sarawakians.

Digital economy, he stressed, would affect everyone – the civil servants and the ‘rakyat’ (people).

“That is why I’m also launching the State Multimedia Authority on this Civil Service Day, so that all civil servants in Sarawak can recognise and understand the significance of this digitalisation initiative.”

Digitalisation, according to him, is affecting the people’s economic development as well as their social lives, causing constant disruptions.

It poses a potential threat to those who are reluctant to embrace new technologies; at the same time, it provides new opportunities to others who are prepared to venture into this new field.

Sarawak, Abang Johari reiterated, had no choice but to strengthen its development strategies to accelerate growth further, in overcoming the challenges of global economy.

“This is imperative, especially with the emergence of digital economy driven by the rapid explosion of technological advancement and the disruptive forces of the digital revolution.”

The Sarawak Digital Economy Strategy 2018-2022 covers eight sectors – agriculture, manufacturing, tourism, Smart City, digital health, e-commerce, digital government, as well as sports, social, arts and culture.

They are supported by seven enablers consisting of digital infrastructure, digital skills and talent development, research and development, digital innovation and entrepreneurship, digital and data, cyber security, and digital inclusivity.

Other notable initiatives slated for kickstarting digital economy include the Development Bank of Sarawak (DBOS), Sarawak Digital Economy Corporation (SDEC), enhancements to the ICT infrastructure, the setting-up of ‘Digital Village’, promotion of e-Learning, promotion of data hosting and ‘Big Data’, as well as the organisation of digital economy laboratories.

 

DBOS

One cannot talk about economic improvements in Sarawak without going into DBOS – a one-of-its-kind initiative to facilitate the state’s venture into strategic, high-impact projects that could propel its transformation.

The state-owned bank would focus on several fronts such as infrastructure development, O&G (O&G) industry, renewable energy, urban transport, telecommunication, digital economy, healthcare and integrated agriculture.

It is to have a paid-up capital of RM500 million upon the start of its operations.

According to Abang Johari, DBOS serves as the way forward for Sarawak to expedite its development through the provision of financial facilities such as term loans, bridging loans and revolving credit facility for working capital financing, loan syndications and bank guarantees.

“These strategic projects will be financed via the state’s own resources – through DBOS. We have learnt from some developed countries that they owe much of their success to their ability of using their homegrown resources.

“We want to invest in some specific areas in order to harness the vast potential of our resources, as well as to increase consumption in order to further boost our domestic economy in the long term.”

Experienced banker Sim Kheng Boon will helm DBOS as its chief executive officer (CEO), supported by a board headed by State Secretary Tan Sri Datuk Amar Mohamad Morshidi Abdul Ghani.

Members of the board include Deputy State Financial Secretary Datu Laura Lee Ngien Hion, lawyer Datuk Sharkawi Alis, consultant engineer Christopher Adrian and Ho Swee Huat, who has vast experience in the securities and banking industries.

In terms of transparency, Deputy Chief Minister II Tan Sri Datuk Amar Dr James Masing affirmed that DBOS would be regulated by Bank Negara.

“DBOS is going to become a bank that makes profit as it will be regulated by Bank Negara. What it means is whoever borrows from it, including the government that owns it, will have to pay back with interest.

“It also means that with the establishment of the bank, it will regulate our own reserves, which will be used as the seed capital.

“So even if the government borrows from its own bank, it will still have to pay back with interests – except now we will manage our own money instead of allowing others to manage it for us. Without the setting up of the bank, it would be difficult for us to obtain the necessary loans to translate our policies into reality.

“But with the setting up of the bank, we can now focus on strategic projects such as key development sectors, namely ICT infrastructure (for digital economy), energy sector including energy power generation as well as O&G, public transportation and services sector including healthcare and tourism,” said Masing.

As provided under Sections 137 and 138 of the Development Financial Institution Act, DBOS would not undertake or advertise for public deposits.

 

Petros

Another important milestone in Abang Johari’s economic shake up is Petroleum Sarawak Bhd (Petros) – the state-owned O&G company aimed at creating better job opportunities for local talents, and also attracting Sarawak expertise currently serving outside the state.

The primary object of Petros is to enable Sarawak to participate in the upstream O&G development, particularly the exploration and extraction of these resources within Sarawak waters.

Petros will not be a ‘partner’ of Petroliam Nasional Bhd (Petronas), unlike other oil giants. Abang Johari said Petros would be granted the ‘same status’ as the national petroleum company.

With Petros, Sarawak would have its own vehicle to work with Petronas in the upstream O&G business.

“We have

to protect the state’s interests in the O&G industry,” he said.

Specifically, Abang Johari pointed out that the setting up of Petros was separate from the state’s demand for a 20-per cent O&G royalty from Putrajaya.

On Aug 25 last year, the chief minister announced the appointment of Tan Sri Datuk Amar Dr Hamid Bugo as Petros chairman, with the board members comprising industry veterans Dato Mohammad Medan Abdullah, Sharbini Suhaili, Zuraimi Sabki and Heng Hock Cheng.

On Petros, it was reported that Petronas president and group chief executive officer Datuk Wan Zulkiflee Wan Ariffin would welcome any involvement by state government entities in the O&G business, but it must be within the Petroleum Development Act (PDA).

“We have a strong relationship with the Sarawak government; as such, we welcome its participation in the O&G industry.

“But we also have regulations in place – under the PDA, Petronas is the custodian and manager of the O&G resources in Malaysia,” he told reporters at a briefing on Petronas’ mid-year results recently.

Wan Zulkiflee added in the report that the partnership with Petros could be similar to others with Petronas – either as service providers or as a partner under the production-sharing contract.

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