Refocus economy or suffer, economist tells Sabah

Economist Firdausi Suffian says Sabah needs to move on from current methods of generating income through resource extraction such as timber exports. (Bernama pic)

KOTA KINABALU: An economist has warned that Sabah needs to shift its focus from a resource extraction economy to a more sustainable manufacturing and agriculture-based economy or suffer the consequences.

Speaking to FMT, Universiti Teknologi Mara lecturer Firdausi Suffian said Sabah was already suffering from a lack of job opportunities, low income and high cost of living.

“Our youth unemployment is approaching 15% and there are not enough jobs available. We have too many under-educated youths who have to compete with migrants for limited well-paying jobs.

“We have been too reliant on service industries such as the tourism industry that do not actually benefit the locals as much as we had hoped.

“Already, a large number of our youths are migrating to other countries to find better jobs as cheap labour working in manufacturing plants,” he said.

It was revealed last year that as many as 150,000 Sabahans are working in the peninsula alone.

Firdausi Suffian

Many more have migrated elsewhere, including to Australia and New Zealand, to work in fruit plantations, as the same amount of work in Sabah pays far less than in other countries.

Currently, Firdausi said, the Sabah government was simply continuing the previous administration’s method of generating income through resource extraction such as timber exports and oil and gas.

The problem, he said, was that when these resources were gone or when the prices plummeted, as was happening now with oil and gas and palm oil, the state had no safety net to rely on to sustain its income and burgeoning expenditure.

While he called for patience as the Sabah government finds its feet, he said it should not take too long to refocus the economy.

The first problem with Sabah, he said, was the absence of a light manufacturing industry and large-scale agriculture which could provide much-needed job opportunities and huge spillover effects.

“As an agriculture-based country, we can become a food basket for Kalimantan and other states in the BIMP-EAGA region with its 70 million population,” he said.

Other industries include the furniture-making industry or factories to make end products for Sabah’s rich palm oil resources such as soap, cooking oil and cosmetics.

In order to do this, he proposed that the government follow the footsteps of its neighbour Sarawak which has successfully transformed the state’s economy through the manufacturing industry.

This includes giving free land and tax exemption to manufacturing industries, providing world-class infrastructure, including uninterrupted power supply and enough water, as well as ensuring good connectivity for imports and exports.

Firdausi said all this needed to be done quickly. He pointed out that at the current rate, Sabah would become a maids and cheap labour exporter in the next decade as more and more youths were forced to go out and take up menial jobs elsewhere.

“In fact, this is already happening now but it could get worse. It is time to change that,” he said.