Brunei - Market Overview Brunei - Market Overview
Brunei Darussalam is a Southeast Asian, oil-rich Sultanate on the northern coast of Borneo. A British protectorate until 1984, it boasts a well-educated and largely English-speaking population, excellent infrastructure, and a government focused on diversifying the economy and bringing foreign investment into the country.
Despite repeated calls for diversification, Brunei’s economy remains overwhelmingly dependent on the income derived from the sale of oil and gas, which represents 90% of Brunei’s total exports and 65 % of the country’s GDP. Additionally, substantial revenue from the government’s overseas investments supplements income from domestic hydrocarbon production. These two revenue streams provide a comfortable quality of life for Brunei’s population. Citizens pay no taxes and receive free education through to the university level, free medical care, and subsidized housing.
Brunei’s central location in Southeast Asia, with good telecommunications and airline connections; no personal income, sales or export taxes; and its stable political situation, offer a welcoming climate for would-be investors. Brunei encourages foreign direct investment (FDI) in its domestic economy through various investment incentives offered by the Ministry of Energy, Manpower and Industry, as well as through activities conducted by the Ministry of Finance and Economy and the Brunei Economic Development Board (BEDB). Additionally, a low crime rate, good schools, housing and sports facilities as well as low utility costs make Brunei an attractive location for short and long-term residence. Life in Brunei reflects the national philosophy of the Malay Islamic Monarchy.
Brunei has no sovereign debt, domestic or foreign, and has not been the recipient of economic aid. Despite importing most consumer goods and food, Brunei’s large oil exports keep its trade balance positive. The Brunei dollar is pegged to the Singapore dollar at a one-to-one ratio, and the Singapore dollar is legal tender in the Sultanate.
The largest destinations for Brunei exports (mostly mineral fuels) for 2018 were Japan (30%), South Korea (14%), Malaysia (11%), and Thailand (11%). The largest sources of imports to Brunei were from China (21%), Singapore (19%), Malaysia (18%), and the United States (8.3%) The largest export sectors by market value were mineral fuels, chemicals, and machinery and transport equipment. The largest import sectors by market value were machinery and transport equipment, manufactured goods, and food.
In 2018, total trade between the United States and Brunei was US $365 million. The 2018 U.S. trade surplus with Brunei was US $169 million: exports totaled US $267 million while imports totaled US $98 million.
More information on U.S.-Brunei trade figures can be found at the U.S. Census website.