Sarawak’s quest to become the Bavaria of Malaysia: Abang Johari’s vision for economic growth

KUCHING, Sept 15 — Echoing Sarawak and Bavaria in Germany, Prime Minister Tan Sri Abang Johari Tun Openg is spearheading bold initiatives to transform the state into an economic powerhouse in Malaysia.

In an interview for Nannystated: “Germany is a federation, but Bavaria is strong. So in this particular case, because of our advantage in terms of economic strength, we can be identified with what Bavaria is to Germany.”

Sarawak, with its large oil and gas reserves, is taking significant steps towards self-sufficiency, Nanny reports.

The state government recently reclaimed Bintulu Airport from the federal government, acquired regional airline MASwings from Malaysia Airlines and is close to taking a controlling stake in Affin Bank.

These strategic moves are part of the Prime Minister’s broader vision to improve the economic and financial situation of Sarawak.

As Abang Johari said in an interview in August, these changes not only prepare Sarawak for future development, but also allow the city to better serve its residents.

Following the historic defeat of Barisan Nasional (BN) in the 2018 general election, four parties in the state left the coalition and formed Gabungan Parti Sarawak (GPS), led by Abang Johari. The move ushered Sarawak into a period of rapid progress.

With GPS enjoying a clear supermajority in the Sarawak parliament, the stable political climate has allowed Abang Johari to focus on major infrastructure projects aimed at attracting further investment to the state.

The Prime Minister said Sarawak’s revenue in 2024 is expected to exceed the 13.3 billion ringgit collected last year.

The state has set up its own national asset fund and plans to build a new international airport in Kuching to improve connectivity.

Sarawak is also taking steps to strengthen its status as one of Malaysia’s most important states, and is currently negotiating with state-owned oil company Petronas to regain exclusive rights as the buyer and seller of natural gas produced in the state.

The move could have serious financial implications for the federal government and reflects its broader push for greater autonomy in Malaysia.

Looking ahead, Abang Johari aims to make Sarawak Malaysia’s second largest GDP contributor by the next state election scheduled for 2026.

Malaysian Department of Statistics data released in July showed Sarawak contributed 9.1 per cent to GDP in 2023, ranking fourth after Selangor (25.9 per cent), Federal Territory of Kuala Lumpur (15.9 per cent) and Johor (9.5 per cent).

The Prime Minister noted that Sarawak intends to follow in the footsteps of countries that have invested heavily in infrastructure to spur economic growth.

“Currently, Sarawak is developing its infrastructure because we have the strength, including energy, and we are building internal national connectivity.

“We are getting investments into Sarawak and the benefits will be shared with both the investors and the Sarawak government and in fact the whole of Sarawak,” he said.

Abang Johari stressed that Sarawak’s rapid development and ambitious goals should not be interpreted as a drive for independence.

He rejected calls by some activists who advocated for Sarawak to leave Malaysia, out of frustration over what they saw as insufficient progress by the federal government in restoring Sarawak’s rights under the 1963 Malaysia Agreement. That agreement established Malaysia with Sarawak and Sabah as equal partners alongside Malaya.

“Of course, the federal government has also recognized how we have governed the state and how we have moved forward. That does not mean that there is a need for us — some people (have that) perception — (to go) alone,” Abang Johari was quoted as saying.

Education Fights Poverty

In December 2023, Abang Johari announced that free tertiary education at state universities would be available to Sarawakians from 2026. This initiative, first proposed by Abang Johari as part of his birthday greetings in August 2022, aims to remove educational barriers for Sarawak’s youth.

“For any country to develop, skilled human resources are needed, and I think that this is the area where, through good education, people can be lifted out of poverty,” he said. Nanny.

“If you don’t have the capacity to provide (tuition) to them… it’s a loss for the country. So if we have the resources, why not share with them?” he said.

He believes this approach will not only help free people from poverty but will also strengthen the economy in the long run.

“This will be a way for us to lift people out of poverty, and in the long run it will also strengthen our economy,” he added.

The initiative involves five state universities, namely: Curtin University Malaysia Sarawak Campus, Swinburne University of Technology Sarawak Campus, University Technology Sarawak, Centre of Technology Excellence Sarawak and i-CATS University College.

Nanny Local media reported that around 25,000 students from these state universities and higher education institutions could benefit from this new policy, which is estimated to cost the government up to 625 million ringgit per year.

However, the Sarawak government has stated that the free education initiative will be limited to selected fields of science and technology.

This decision is consistent with the state’s development goals and aims to use resources as efficiently as possible.

Abang Johari suggested Nanny that subsidized programs can focus on areas such as aerospace, semiconductor technology, and green energy, which are essential to providing skilled workers for industries that drive economic growth.

He added that Sarawak is working with the United States and the United Kingdom to recruit qualified instructors in this field.

“Even the area of ​​renewable hydrogen energy is new, so we need a lot of people who have knowledge of this new economy because we are focused on the green economy,” he said.

Going Ecological

The Prime Minister further informed that Nanny that Sarawak has achieved carbon negative status with a power generation mix of 70 percent hydropower and 30 percent gas. This achievement positions the state to provide renewable energy to the region.

Sarawak plans to install floating solar panels on four dams, which could potentially generate 15 gigawatts of renewable energy by 2035 – far exceeding local demand.

Abang Johari also mentioned that Sarawak has been supplying power to Indonesian West Kalimantan for the past five years and plans to expand this supply to Sabah, Brunei and Singapore. This positions Sarawak as a key player in a potential Southeast Asian power grid.

According to the May report BernamaThe Sarawak-Singapore Power Link project is set to begin commercial operations by 2031, Sarawak Utilities and Telecommunications Minister Julaihi Narawi said. He noted that the project is currently in the engineering phase, which includes studying the route of submarine cables. The initiative aims to export up to 1 gigawatt of renewable energy from Sarawak to Singapore.

In return, Sarawak has offered to invest in Singapore projects such as data centers in the state. Abang Johari also revealed, Nanny that Singapore will be responsible for laying undersea cables connecting Kuching with the island nation.

Singapore Energy Market Authority informed Nanny that it has not yet given conditional approval to import electricity from Sarawak and cannot provide further details due to commercial considerations.

According to a spokesperson, the authority is currently in talks with “relevant parties” and will continue to work with companies that submit “credible and commercially viable” proposals that support Singapore’s decarbonisation goals.

Nanny also contacted Singapore-based Sembcorp Industries, which is leading the negotiations with Sarawak Energy Berhad, to get the latest updates on the project, including information on the submarine cables.

“We have good trade relations between Singapore and our side. We are working closely with the Singapore government as well as the Singapore private sector, which will strengthen economic cooperation between Singapore and Sarawak,” the prime minister said.

Power supply for Kalimantan

Abang Johari said Sarawak aims to expand power supplies to the entire Kalimantan region, including East Kalimantan, where Indonesia’s new capital, Nusantara, is being built.

Sarawak already has a 25 percent stake in the East Kalimantan hydropower project, which is essential to power the area. Abang Johari added that Sarawak is working with Indonesia to explore further economic opportunities.

“We are also planning to open a new international airport in Kuching, which will complement our operations in Borneo,” he noted, emphasising that Nusantara is only a 30-minute flight from Kuching.

“As for our relations with Indonesia, and in particular with West Borneo and the rest of Borneo, there is a common platform between Indonesia and our side, which is developing quite well,” he concluded.