While Brunei enjoyed enviable prosperity and stability because of its extensive oil and natural gas reserves, the Southeast Asian sultanate has had to restudy its economic plans amid the delayed recovery of the global petroleum market.
Among the companies that were affected by the slump in oil prices, Baiduri Bank, one of Brunei’s largest financial groups, has had to diversify its business model to attract a wider base of customers.
“When oil and gas prices go down, the income generated from these industries to the government also goes down. The government is going through the process of tightening spending on other projects,” Baiduri Bank CEO Pierre Imhof explained.
Baiduri Bank offers a full range of services –retail, corporate and commercial banking – aimed at the small and medium-sized enterprises, all of which demand innovative products and up-to-date technology.
“Brunei’s citizens travel overseas and see how the banking industry is run there. So, they expect the same in Brunei,” Imhof also said.
Kingston Beverage and Creamery, the largest food and beverage company in Brunei, has also suffered from the downward trend in oil prices. While it still enjoys the biggest market share in carbonated drinks, the company has had to produce other types of beverages to cater to changing consumer tastes and trends in the industry.
“Purchasing power has dropped. Overall, the supply dropped between 6 and 8 percent in terms of food and consumer products. We are looking into the possibility of joint ventures in healthcare products to be produced in Brunei,” said Managing Director Malcolm Lim.
As the government and its large industry players look out for more growth opportunities, Brunei has been gradually making headway beyond its shores. It boasts a strategic geographical location that allows easy connectivity to its neighbors in Asia and to markets in the West. The country’s stable environment and currency have proved very attractive for foreign investors.
“Brunei is small but is a perfect platform to the ASEAN market, which is perfect for investors,” said Hajah Hasnah binti Ibrahim, acting CEO of the Brunei Economic Development Board (BEDB).
Another strength is its people. Bruneians have gained praise for their skills in different industries, exceeding the expectations of international investors that decided to establish operations in the country.
Tech One Global, the first tech investor in Brunei, introduced the Microsoft brand into the market.
“We were born in Brunei with Microsoft,” said CEO Lars Jeppesen.
The company, the leading value-added distributor of Microsoft, has remained strong because of its long-term projects with the government to improve overall technological structure. Compared to other foreign companies in the country, Tech One Global also employs among the highest number of locals.
Another foreign company that appreciates Brunei’s talent pool is Sengenics, an advanced biotech company that is currently expanding its research facilities in the country. It is prioritizing closer collaboration in R&D for commercial applications.
Because of the nature of its business, Sengenics has required very specialized technical skills and knowledge. Initially concerned about the local workforce, the company was soon pleasantly surprised.
“We hired people from the UK for back-up but were successful in finding more people here than we needed. We were very impressed. And work ethic here has been better than some in other locations,” CEO Dr. Arif Anwar recalled.