Brunei’s economy shows signs of recovery, but oil and gas remain only drivers

Brunei’s economy shows signs of recovery, but oil and gas remain only drivers
Waterfront in Brunei’s capital Bandar Seri Begawan © Arno Maierbrugger

Despite Brunei’s attempts to diversify its economy, only increases in oil and gas production in the first quarter of 2018 have boosted the country’s gross domestic product (GDP), official figures show.

According to statistics released by the Department of Economic Planning and Development on July 30, liquefied natural gas production was up by 12 per cent compared to the same period last year.

Crude oil production was also up from 125.3 to 125.6 thousand barrels per day with the total value further boosted by increases in oil prices which stood at $69.50 per barrel in the first quarter of 2018 compared to $56.40 in the same period in 2017.

The oil and gas sector continues to dominate the economy, accounting for 58.4 per cent of gross value added – a measure of all the goods and services produced in the Sultanate. It was up by 3.3 per cent from last year. The non-oil and gas sector made up 41.6 per cent, a decrease of 23.7 million Brunei dollars compared to the first quarter in 2017.

The decreases included land transport (-8.9 per cent), manufacturing of apparels and textiles (-8.1 per cent) and food and beverage (-4.9 per cent). Agriculture and fisheries also declined by 25.9 per cent and 17.1 per cent, respectively.

Unadjusted for inflation, Brunei’s highest GDP was recorded in 2012 at $19.05 billion, before dropping for four consecutive years to $11.40 billion in 2016, largely due to a downturn in oil and gas prices. In 2017, Brunei’s economy recovered from the recession by posting a 1.3 per cent growth of a GDP of $12.13 billion.

According to Autoriti Monetari Brunei Darussalam’s 2017 annual report, last year’s GDP increase was linked to the oil and gas sector which grew by 1.2 per cent, driven by a 9.7 cent increase in production in LNG and methanol.

The non-oil and gas sector also grew by 1.5 per cent, with the highest growth in water transport due to larger shipments of LNG, with construction industry also growing by 9.3 per cent with large-scale projects including the Temburong bridge and private sector investments like Hengyi’s Petrochemical Plant at Pulau Muara Besar underway. There are also new other industries being established, for example a fertilisier and an air separation plant which will produce liquefied oxygen and other gases for industrial use.



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[caption id="attachment_31856" align="alignleft" width="300"] Waterfront in Brunei's capital Bandar Seri Begawan © Arno Maierbrugger[/caption] Despite Brunei’s attempts to diversify its economy, only increases in oil and gas production in the first quarter of 2018 have boosted the country’s gross domestic product (GDP), official figures show. According to statistics released by the Department of Economic Planning and Development on July 30, liquefied natural gas production was up by 12 per cent compared to the same period last year. Crude oil production was also up from 125.3 to 125.6 thousand barrels per day with the total value further boosted by increases in...

Brunei’s economy shows signs of recovery, but oil and gas remain only drivers
Waterfront in Brunei’s capital Bandar Seri Begawan © Arno Maierbrugger

Despite Brunei’s attempts to diversify its economy, only increases in oil and gas production in the first quarter of 2018 have boosted the country’s gross domestic product (GDP), official figures show.

According to statistics released by the Department of Economic Planning and Development on July 30, liquefied natural gas production was up by 12 per cent compared to the same period last year.

Crude oil production was also up from 125.3 to 125.6 thousand barrels per day with the total value further boosted by increases in oil prices which stood at $69.50 per barrel in the first quarter of 2018 compared to $56.40 in the same period in 2017.

The oil and gas sector continues to dominate the economy, accounting for 58.4 per cent of gross value added – a measure of all the goods and services produced in the Sultanate. It was up by 3.3 per cent from last year. The non-oil and gas sector made up 41.6 per cent, a decrease of 23.7 million Brunei dollars compared to the first quarter in 2017.

The decreases included land transport (-8.9 per cent), manufacturing of apparels and textiles (-8.1 per cent) and food and beverage (-4.9 per cent). Agriculture and fisheries also declined by 25.9 per cent and 17.1 per cent, respectively.

Unadjusted for inflation, Brunei’s highest GDP was recorded in 2012 at $19.05 billion, before dropping for four consecutive years to $11.40 billion in 2016, largely due to a downturn in oil and gas prices. In 2017, Brunei’s economy recovered from the recession by posting a 1.3 per cent growth of a GDP of $12.13 billion.

According to Autoriti Monetari Brunei Darussalam’s 2017 annual report, last year’s GDP increase was linked to the oil and gas sector which grew by 1.2 per cent, driven by a 9.7 cent increase in production in LNG and methanol.

The non-oil and gas sector also grew by 1.5 per cent, with the highest growth in water transport due to larger shipments of LNG, with construction industry also growing by 9.3 per cent with large-scale projects including the Temburong bridge and private sector investments like Hengyi’s Petrochemical Plant at Pulau Muara Besar underway. There are also new other industries being established, for example a fertilisier and an air separation plant which will produce liquefied oxygen and other gases for industrial use.



Support ASEAN news

Investvine has been a consistent voice in ASEAN news for more than a decade. From breaking news to exclusive interviews with key ASEAN leaders, we have brought you factual and engaging reports – the stories that matter, free of charge.

Like many news organisations, we are striving to survive in an age of reduced advertising and biased journalism. Our mission is to rise above today’s challenges and chart tomorrow’s world with clear, dependable reporting.

Support us now with a donation of your choosing. Your contribution will help us shine a light on important ASEAN stories, reach more people and lift the manifold voices of this dynamic, influential region.

$
Personal Info

Donation Total: $10.00

 

 

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