Interview with Sarawak Minister Awang Tengah
Resource planning, environment, public utilities and industrial development are tasks that all fall under Second Minister YB Datuk Amar Haji Awang Tengah Bin Ali Hasan, who oversees three ministries in Sarawak. Inside Investor wanted to know what the challenges of governing these departments are.
Q: You have a large field of responsibilities. What are the current topics that your ministries are dealing with?
A: This large field of responsibilities is the result of the portfolios in three ministries assigned to me by the state cabinet led by the chief minister. The ministries are the Ministry of Public Utilities, the Ministry of Industrial Development, and the Ministry of Resource Planning and Environment in which I am the second minister. The minister is the chief minister himself. They are interrelated in their effort to develop Sarawak to become a prosperous, developed, high-income and environmentally safe state as it is now and the years ahead. Steps are being taken to ensure that all the effort and resources of these three ministries are carefully gauged to develop Sarawak, particularly the plan of the Sarawak Corridor of Renewable Energy area, or SCORE. Under the Ministry of Resource Planning and Environment, my portfolio covers a wide scope on the planning and managing of land, minerals and mining, land use, forest and forestry, and environment. My portfolio under the Ministry for Public Utilities broadly covers matters of energy, electricity and water supplies, and related issues such as dam development. Under the Ministry for Industrial Development, my portfolio covers industrial estates development, investment promotions, small and medium industries, and industrial coordination committees with the federal government.
Q: Sarawak has made great steps forward in its industrial development. What are the major challenges in boosting the sector further?
A: There are some challenges we face now in industrial development such as negative campaigns by both local and foreign NGOs and interest groups, and unsubstantiated reporting by foreign media and online portals. These challenges are coupled with the provision of adequate water and power supply, and keeping up with infrastructure development to meet the demands of investors.
Q: Environmental regulations in Sarawak are sometimes stricter than in many Western economies. Why is there such a big emphasis on this sector?
A: Environmental impact assessment studies and reports are mandatory for any project listed under prescribed activities and are to be submitted to the Natural Resources and Environment Board. At the same time, the Department of Environment is also playing its role to ensure that all requirements are met so as to safeguard the social and environmental aspects of the areas concerned. Furthermore, to remain competitive, Sarawak has to comply with international standards. As strict as we are, we have proved to be quite attractive to foreign investors – which is reflected by the positive response to SCORE-related projects.
Q: In the public utilities sector, what is the ministry’s strategy regarding public-private partnerships? Are you actively looking for private investors?
A: The public utilities sector is more exclusive in nature here in the sense that the state government plans the projects based on the needs of the communities and industries to be set up. Of course, my ministry adopts a strategy that would give long-term benefits to the people, industries and the state. We are open to the idea of public-private partnerships at any stage of service delivery when there are opportunities for win-win situations. So, private investors may take part here. Therefore, the state government of Sarawak has decided to form the Performance Management and Delivery Unit (PEMANDU) where both the private and public sectors can share their ideas.
Q: What is the ministry’s strategy in terms of resource planning? What resources are entailed?
A: The Ministry of Resource Planning and Environment adopts a holistic and balanced strategy developed by the state government of Sarawak to plan and manage the abundant resources here so that they can benefit the people as a whole. My ministry ensures that resources in Sarawak are to be sustainable. This strategy has become a policy of the government of the day. As Sarawak began its development programmes through strategic planning after it gained independence through the formation of a Malaysian nation in 1963, every effort has been gauged to make resources available to be planned and managed sustainably for long-term benefits. My ministry learned from the steps taken by other countries and is benchmarking the best practices. For instance, one million hectares in Sarawak have been set aside as totally protected areas in the form of national parks, wild life sanctuaries and nature reserves out of 12.4 million hectares total land mass of Sarawak. We practise sustainable forest management. We are proud to say that 70 per cent of our land mass is still forest covered. Resources here consist of land, forests, oil and gas, minerals, energy and water.
Q: What is the public policy in balancing the interests of the industry and the interests of local communities?
A: It has become the policy of the state government of Sarawak to carry out strategic social and environmental impact assessment to meet the interests of the affected local communities. For example, in the case of the Penan community in the Murum Dam project.
Q: What incentives would foreign investors find in the sectors of public utilities and industry?
A: For the public utilities sector, the stages in the realisation of service delivery normally cover planning, investigation, design, construction, testing and commissioning, operation and maintenance. Procurement is typically done through open tenders or sometimes on a negotiated basis. In the industrial sector, state incentives consist of competitive and flexible terms of payment for industrial land, rebate on land premiums if a project is completed within a stipulated time frame, and negotiable, competitive electricity tariffs. This all complements federal incentives such as pioneer status, investment tax allowance and reinvestment allowance to entice investors to Sarawak. Customised incentives are offered mainly for high impact and strategic projects through negotiation with the Malaysian Industrial Development Authority, or MIDA. If the investor agrees to the customised incentives after negotiation, MIDA shall offer the investor incentives such as soft loans, grants for training and grants for research and development. At the same time, the investor also shall be able to enjoy pioneer status and receive an investment tax allowance.
Q: What is the current penetration of the Sarawak population with power and water services? What are the targets over the next five years?
A: With the existing plans already being carried out by the state government to expand power and water services to the population, the federal government also came up to further extend these services through the development transformation programmes, or National Key Result Areas (NKRA) initiated by the prime minister. Since the introduction of NKRA, the penetration rate for the rural population for both services by 2011 has reached a remarkable level of 72 per cent for electricity through the grid system and 65 per cent for treated water. My ministry will aim to provide coverage for treated water to reach 90 per cent and electricity to reach 95 per cent for the rural population by 2015.
Q: Of what nature is the collaboration in resource planning, environment, and industrial development with neighbouring countries Brunei and Indonesia?
A: In the first place, resource planning, environment and industrial development are viewed strictly as matters within the state of Sarawak and to some extent the nation of Malaysia. However, Sarawak would not benefit to the maximum if these were to be confined. As Sarawak, Brunei and Kalimantan Indonesia are on the same island, these three regions are connected, and we view it in a way that they could benefit the people, the economy, and the environment in all three neighbouring countries. Effort has been made to arrange some kind of collaboration among the three governments, although they have a different political approach to and different policies in these subjects. In this context, the collaboration that has been established for the three governments is through the creation of the Heart of Borneo initiative, BIMP, SOSEC MALINDO and the Joint Border Committees Malaysia-Brunei and Malaysia-Indonesia. With regard to the Heart of Borneo, the state government of Sarawak committed 2.1 million hectares to be conserved and managed sustainably. So far, Sarawak has been able to reach a workable agreement with Brunei on setting up proper road links and border controls at specific entry points. The same goes with Kalimantan Indonesia. In a bigger picture, Sarawak has been able to negotiate with Brunei and Indonesia to sell some of its energy from hydroelectric power generation in the years to come, if these two countries require it commercially and industrially. Sarawak treats itself as a potential state to collaborate in all the three areas with the two countries as long as such collaboration would bring economic return and revenue to the people and the state. Of course, Sarawak is actively looking at the possibility to forge a more concrete and established collaboration with the two governments as time goes by.
Q: Are foreign investors invited to set up businesses to exploit minerals or conduct mining in Sarawak?
A: The current policy of the state government accommodates foreign investors apart from local investors to deal with minerals extraction in Sarawak. The state government would consider companies wholly owned by foreign investors as well as joint ventures with local companies to exploit minerals or conduct mining.
[caption id="attachment_4017" align="alignleft" width="200"] Second Minister YB Datuk Amar Haji Awang Tengah bin Ali Hasan[/caption] Resource planning, environment, public utilities and industrial development are tasks that all fall under Second Minister YB Datuk Amar Haji Awang Tengah Bin Ali Hasan, who oversees three ministries in Sarawak. Inside Investor wanted to know what the challenges of governing these departments are. Q: You have a large field of responsibilities. What are the current topics that your ministries are dealing with? A: This large field of responsibilities is the result of the portfolios in three ministries assigned to me by the state cabinet...
Resource planning, environment, public utilities and industrial development are tasks that all fall under Second Minister YB Datuk Amar Haji Awang Tengah Bin Ali Hasan, who oversees three ministries in Sarawak. Inside Investor wanted to know what the challenges of governing these departments are.
Q: You have a large field of responsibilities. What are the current topics that your ministries are dealing with?
A: This large field of responsibilities is the result of the portfolios in three ministries assigned to me by the state cabinet led by the chief minister. The ministries are the Ministry of Public Utilities, the Ministry of Industrial Development, and the Ministry of Resource Planning and Environment in which I am the second minister. The minister is the chief minister himself. They are interrelated in their effort to develop Sarawak to become a prosperous, developed, high-income and environmentally safe state as it is now and the years ahead. Steps are being taken to ensure that all the effort and resources of these three ministries are carefully gauged to develop Sarawak, particularly the plan of the Sarawak Corridor of Renewable Energy area, or SCORE. Under the Ministry of Resource Planning and Environment, my portfolio covers a wide scope on the planning and managing of land, minerals and mining, land use, forest and forestry, and environment. My portfolio under the Ministry for Public Utilities broadly covers matters of energy, electricity and water supplies, and related issues such as dam development. Under the Ministry for Industrial Development, my portfolio covers industrial estates development, investment promotions, small and medium industries, and industrial coordination committees with the federal government.
Q: Sarawak has made great steps forward in its industrial development. What are the major challenges in boosting the sector further?
A: There are some challenges we face now in industrial development such as negative campaigns by both local and foreign NGOs and interest groups, and unsubstantiated reporting by foreign media and online portals. These challenges are coupled with the provision of adequate water and power supply, and keeping up with infrastructure development to meet the demands of investors.
Q: Environmental regulations in Sarawak are sometimes stricter than in many Western economies. Why is there such a big emphasis on this sector?
A: Environmental impact assessment studies and reports are mandatory for any project listed under prescribed activities and are to be submitted to the Natural Resources and Environment Board. At the same time, the Department of Environment is also playing its role to ensure that all requirements are met so as to safeguard the social and environmental aspects of the areas concerned. Furthermore, to remain competitive, Sarawak has to comply with international standards. As strict as we are, we have proved to be quite attractive to foreign investors – which is reflected by the positive response to SCORE-related projects.
Q: In the public utilities sector, what is the ministry’s strategy regarding public-private partnerships? Are you actively looking for private investors?
A: The public utilities sector is more exclusive in nature here in the sense that the state government plans the projects based on the needs of the communities and industries to be set up. Of course, my ministry adopts a strategy that would give long-term benefits to the people, industries and the state. We are open to the idea of public-private partnerships at any stage of service delivery when there are opportunities for win-win situations. So, private investors may take part here. Therefore, the state government of Sarawak has decided to form the Performance Management and Delivery Unit (PEMANDU) where both the private and public sectors can share their ideas.
Q: What is the ministry’s strategy in terms of resource planning? What resources are entailed?
A: The Ministry of Resource Planning and Environment adopts a holistic and balanced strategy developed by the state government of Sarawak to plan and manage the abundant resources here so that they can benefit the people as a whole. My ministry ensures that resources in Sarawak are to be sustainable. This strategy has become a policy of the government of the day. As Sarawak began its development programmes through strategic planning after it gained independence through the formation of a Malaysian nation in 1963, every effort has been gauged to make resources available to be planned and managed sustainably for long-term benefits. My ministry learned from the steps taken by other countries and is benchmarking the best practices. For instance, one million hectares in Sarawak have been set aside as totally protected areas in the form of national parks, wild life sanctuaries and nature reserves out of 12.4 million hectares total land mass of Sarawak. We practise sustainable forest management. We are proud to say that 70 per cent of our land mass is still forest covered. Resources here consist of land, forests, oil and gas, minerals, energy and water.
Q: What is the public policy in balancing the interests of the industry and the interests of local communities?
A: It has become the policy of the state government of Sarawak to carry out strategic social and environmental impact assessment to meet the interests of the affected local communities. For example, in the case of the Penan community in the Murum Dam project.
Q: What incentives would foreign investors find in the sectors of public utilities and industry?
A: For the public utilities sector, the stages in the realisation of service delivery normally cover planning, investigation, design, construction, testing and commissioning, operation and maintenance. Procurement is typically done through open tenders or sometimes on a negotiated basis. In the industrial sector, state incentives consist of competitive and flexible terms of payment for industrial land, rebate on land premiums if a project is completed within a stipulated time frame, and negotiable, competitive electricity tariffs. This all complements federal incentives such as pioneer status, investment tax allowance and reinvestment allowance to entice investors to Sarawak. Customised incentives are offered mainly for high impact and strategic projects through negotiation with the Malaysian Industrial Development Authority, or MIDA. If the investor agrees to the customised incentives after negotiation, MIDA shall offer the investor incentives such as soft loans, grants for training and grants for research and development. At the same time, the investor also shall be able to enjoy pioneer status and receive an investment tax allowance.
Q: What is the current penetration of the Sarawak population with power and water services? What are the targets over the next five years?
A: With the existing plans already being carried out by the state government to expand power and water services to the population, the federal government also came up to further extend these services through the development transformation programmes, or National Key Result Areas (NKRA) initiated by the prime minister. Since the introduction of NKRA, the penetration rate for the rural population for both services by 2011 has reached a remarkable level of 72 per cent for electricity through the grid system and 65 per cent for treated water. My ministry will aim to provide coverage for treated water to reach 90 per cent and electricity to reach 95 per cent for the rural population by 2015.
Q: Of what nature is the collaboration in resource planning, environment, and industrial development with neighbouring countries Brunei and Indonesia?
A: In the first place, resource planning, environment and industrial development are viewed strictly as matters within the state of Sarawak and to some extent the nation of Malaysia. However, Sarawak would not benefit to the maximum if these were to be confined. As Sarawak, Brunei and Kalimantan Indonesia are on the same island, these three regions are connected, and we view it in a way that they could benefit the people, the economy, and the environment in all three neighbouring countries. Effort has been made to arrange some kind of collaboration among the three governments, although they have a different political approach to and different policies in these subjects. In this context, the collaboration that has been established for the three governments is through the creation of the Heart of Borneo initiative, BIMP, SOSEC MALINDO and the Joint Border Committees Malaysia-Brunei and Malaysia-Indonesia. With regard to the Heart of Borneo, the state government of Sarawak committed 2.1 million hectares to be conserved and managed sustainably. So far, Sarawak has been able to reach a workable agreement with Brunei on setting up proper road links and border controls at specific entry points. The same goes with Kalimantan Indonesia. In a bigger picture, Sarawak has been able to negotiate with Brunei and Indonesia to sell some of its energy from hydroelectric power generation in the years to come, if these two countries require it commercially and industrially. Sarawak treats itself as a potential state to collaborate in all the three areas with the two countries as long as such collaboration would bring economic return and revenue to the people and the state. Of course, Sarawak is actively looking at the possibility to forge a more concrete and established collaboration with the two governments as time goes by.
Q: Are foreign investors invited to set up businesses to exploit minerals or conduct mining in Sarawak?
A: The current policy of the state government accommodates foreign investors apart from local investors to deal with minerals extraction in Sarawak. The state government would consider companies wholly owned by foreign investors as well as joint ventures with local companies to exploit minerals or conduct mining.
