Realising Brunei’s economic potential

Reading Time: 3 minutes

Brunei ShellBrunei Darussalam, the country situated in the very center of Southeast Asia, has so much to give to the region. Not so much of its petro currency as many would think, but in terms of human potential, Islamic finance and its location as a trading hub.

These are some of the top three identified industries that could ultimately contribute to our nation’s economic growth and ultimately the nation’s survival.

But is the nation too complacent with oil money than to develop leaders to head on these projects effectively? If so, what would be the consequence of our current leaders today?

Let’s look back in history at a time when Spain was at its dynastic height in the 15th century. Their ascent to power were fueled by the discovery and exploitation of silver and gold in South America. Nothing seemed to slow their growth down in their ever-extending conquest of land and sea. Every neighbour with similar intent seemed to be terrified of their wealth and power.

One of the neighbours were the Dutch. Once a colony to Spain, they rebelled and fought against the invading Spanish kingdom. Under the call for independence, they saw that the only way to beat the Spanish was to focus in economic growth.

From this philosophy came the financial innovation that would one day dominate and shape the world we live in today. It was during this crisis when they invented the Amsterdam Exchange(stock market), Dutch East India Company (Joint-stock holding company) and the Bank of Amsterdam (central bank).

With these tools, the Dutch were able to finance their wars effectively and conduct trade across the Asian peninsula profitably. It was a key instrument in sustaining its economy and building the wealth of the nation.

When the war came to an end, the Dutch emerged victorious. Not because the Dutch won the war but because the Spanish lost it.

It began with Spain’s tendency to finance everything with money. In raising up an army and purchasing weapons in their conquests, they utilised gold and silver as their main source of exchange. This method became the anathema for the economy because 1) their expenditure effectively devalued the gold and silver metals 2) it pushed prices of basic necessities up to the ceiling 3) this lead to the weakening of the kingdom’s military and political prowess in the process.

The result was devastating. From 1600 to 1650 the monarch accumulated deficits and produced continuous internal strife that ultimately defaulted the country not once, not twice, but 16 times and thus dethroned the ruling body of its time.

On another hand, the Dutch continued to thrive and built themselves into a super-economic entity that rivaled that of Great Britain during its imperial height. Through the mercantilism exchange, the Dutch became wealthy and powerful. It is in this state that also gave birth to liberalism.

The illustration only serves as a case study on how damaging it is for nations spend its way out of trouble. This philosophy is still with some of our senior leaders today, unfortunately.

So how can we, Bruneians move from here?

One thing for sure everyone needs to learn the importance of innovation in this global age; not simply utilising oil and gas as an all-out solution. We need to remember these resources are just tools for the end goal.

What is the end goal then? To transform Brunei Darussalam into a country which can promote commercial value in niche industries such as Islamic finance, commerce and trade and human potential. (More will be elaborated on these subjects in later writings.)

Equally important question: what is not the end goal? Relying too much on petro currencies in solving our problems instead of utilising our people’s innovative capacity to create new methods to serve a greater lot to the public through enterprising and creative projects.

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Reading Time: 3 minutes

Brunei Darussalam, the country situated in the very center of Southeast Asia, has so much to give to the region. Not so much of its petro currency as many would think, but in terms of human potential, Islamic finance and its location as a trading hub.

Reading Time: 3 minutes

Brunei ShellBrunei Darussalam, the country situated in the very center of Southeast Asia, has so much to give to the region. Not so much of its petro currency as many would think, but in terms of human potential, Islamic finance and its location as a trading hub.

These are some of the top three identified industries that could ultimately contribute to our nation’s economic growth and ultimately the nation’s survival.

But is the nation too complacent with oil money than to develop leaders to head on these projects effectively? If so, what would be the consequence of our current leaders today?

Let’s look back in history at a time when Spain was at its dynastic height in the 15th century. Their ascent to power were fueled by the discovery and exploitation of silver and gold in South America. Nothing seemed to slow their growth down in their ever-extending conquest of land and sea. Every neighbour with similar intent seemed to be terrified of their wealth and power.

One of the neighbours were the Dutch. Once a colony to Spain, they rebelled and fought against the invading Spanish kingdom. Under the call for independence, they saw that the only way to beat the Spanish was to focus in economic growth.

From this philosophy came the financial innovation that would one day dominate and shape the world we live in today. It was during this crisis when they invented the Amsterdam Exchange(stock market), Dutch East India Company (Joint-stock holding company) and the Bank of Amsterdam (central bank).

With these tools, the Dutch were able to finance their wars effectively and conduct trade across the Asian peninsula profitably. It was a key instrument in sustaining its economy and building the wealth of the nation.

When the war came to an end, the Dutch emerged victorious. Not because the Dutch won the war but because the Spanish lost it.

It began with Spain’s tendency to finance everything with money. In raising up an army and purchasing weapons in their conquests, they utilised gold and silver as their main source of exchange. This method became the anathema for the economy because 1) their expenditure effectively devalued the gold and silver metals 2) it pushed prices of basic necessities up to the ceiling 3) this lead to the weakening of the kingdom’s military and political prowess in the process.

The result was devastating. From 1600 to 1650 the monarch accumulated deficits and produced continuous internal strife that ultimately defaulted the country not once, not twice, but 16 times and thus dethroned the ruling body of its time.

On another hand, the Dutch continued to thrive and built themselves into a super-economic entity that rivaled that of Great Britain during its imperial height. Through the mercantilism exchange, the Dutch became wealthy and powerful. It is in this state that also gave birth to liberalism.

The illustration only serves as a case study on how damaging it is for nations spend its way out of trouble. This philosophy is still with some of our senior leaders today, unfortunately.

So how can we, Bruneians move from here?

One thing for sure everyone needs to learn the importance of innovation in this global age; not simply utilising oil and gas as an all-out solution. We need to remember these resources are just tools for the end goal.

What is the end goal then? To transform Brunei Darussalam into a country which can promote commercial value in niche industries such as Islamic finance, commerce and trade and human potential. (More will be elaborated on these subjects in later writings.)

Equally important question: what is not the end goal? Relying too much on petro currencies in solving our problems instead of utilising our people’s innovative capacity to create new methods to serve a greater lot to the public through enterprising and creative projects.

Do you like this post?
  • Fascinated
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