Efforts are under way to direct greater focus to Brunei Darussalam’s agriculture sector, in order to both improve food security and create a niche in the global market. Crude oil and natural gas production comprise 60% of GDP and more than 90% of exports, while the agriculture sector’s share of GDP is only 0.72% and employs just 1.4% of the population. To overcome its dependency on food imports, which account for 80% of the national food supply, the sultanate aims to achieve self-sufficiency by increasing capacity while continuing to specifically target halal foods.
Innovation and collaboration
In 2013, the government launched a series of initiatives for enhancing the position of agriculture, including increasing livestock production to lower the significant imports of livestock from Australia. A master plan for building a combined livestock and fruit tree farm in Tutong was also started and is expected to support feedlotting activity.
A key initiative likely to have a knock-on effect for the industry is a $21m irrigation project in the area of Imang Dam, which will supply other regions with water. With new cultivation projects also under way, a promising development has been the joint-venture agreement signed between a Bruneian and Chinese company to establish an agricultural industrial park. Estimated at $4m and encompassing some 80 ha, the site is expected to be ready within five years and will integrate the production of vegetables, rice, fruits and a chicken farm, as well as a reservoir for breeding fish.
Adding value to output is also a key part of the sectoral strategy and Brunei Darussalam is taking aim at the global halal market. The country has constructed a Halal Science Centre, which will launch its operations in July 2014 with key equipment and machinery for conducting halal food analyses. The Brunei Darussalam Halal Centre will cooperate with three international institutions, including Florida State University, the Graduate School of Engineering at Osaka University and Japan Food Research Laboratories. Corporation South Korea will also participate in the research and development of halal products as a biotech partner.
The growing demand for halal food in Brunei Darussalam has opened new development trends in the food industry. Unexploited agricultural resources, combined with skilled domestic employees, are an important combination for the development of halal research activities. The country is represented globally by its Brunei Halal (BH) brand and with an operational office in the UK.
According to officials, the BH brand will strictly follow requirements governing the slaughtering of animals and special feeding methods for chickens, which constitute a value-added cost. Due to the strict adherence to the halal food requirements, BH is expected to be well received among Muslim nations, with the sultanate aiming to become a top regional player in the manufacture and handling of food, cosmetics, pharmaceuticals and agricultural products.
Enhancements to specific niches include a government goal to achieve self-sufficiency in rice production. By 2015, it is expected that 60% self-sufficiency will be achieved. To boost output a new hybrid rice, titih, which can increase yields from 2 to 3 tonnes per ha to the 3.8-8.7 tonnes per ha range, is being deployed.
The fisheries industry also has a promising future in Brunei-Darussalam. By 2023, the sector is expected to grow by 170% and account for $187.7m, while the livestock breeding segment is predicted to increase to BN140m ($109.83m). The government is aiming for the farming sector to expand by 18% and account for BN44m ($34.52m) over the same period, while the seafood processing segment is set to grow 24% and account for BN57m ($44.72m). The sultanate is also building a stronger regional reputation as a centre for oyster farming. This niche in East Asian markets is potentially highly profitable and currently accounts for BN3.34m ($2.62m).
Brunei Darussalam has all the prerequisites for developing and diversifying its agriculture sector, including an alignment of the government’s policy goals with those of private enterprise and modernising administrative capacity to reduce outdated practices. With key international partnerships and the support of domestic and foreign companies, the entire sector is set to be transformed and enable the country to be an exporter of a variety of goods.
*This article was originally published in the Oxford Business Group on 20 May 2014. Read the original article here.