from ECONOMIC OUTLOOK
Published online by Cambridge University Press: 21 October 2015
As one of the most oil-dependant economies of Southeast Asia, the sultanate of Brunei's economic prospects hinge largely on the oil and gas sector. Crude oil and liquefied natural gas accounts for half of Brunei's GDP, as well as 90 per cent of its exports and 88 per cent of government revenue. As crude oil prices continue to spiral upwards to about US$70 a barrel (as of September 2005) in the wake of a myriad of factors including stronger demands from China, continuous oil supply disruption in the Middle East and disruptions in global oil production due to the adverse impacts of hurricanes Katrina and Rita in the Gulf of Mexico in the United States, the sultanate exchequer is likely to get a boost.
According to the Brunei Economic Bulletin (BEB), the non-oil sector expanded by 6.0 per cent in the first quarter (Q1) of 2005 compared with the same period last year owing to the strong performance in forestry, construction, wholesale and retail, restaurant and hotels, and transport and communication sectors. The wholesale and retail trade, construction, and transport and communication sectors are likely to maintain steady growth in 2006.
Brunei recorded a steadily improving budgetary position in 2005 due to the skyrocketing oil prices. In Q1 2005, the economy witnessed a budget surplus of B$99.11 million (US$58.68 million). The state of government finance is expected to remain in surplus in 2006, benefiting from the high global oil prices. The Brunei government expects this surplus to be instrumental in accelerating the implementation of country's 8th National Development Plan.
The BEB reported that Brunei recorded a trade surplus of B$1,860.5 million (US$1,101.60 million) during Q1 2005 owing to the persistent oil price hike and a plunge in import demand. However, a stronger consumer demand and construction growth may push the import demand in 2006 substantially. In Q1 2005, Japan remained the dominant export market of Brunei, followed by ASEAN, Korea, Australia, United States, India, and China.
- Regional OutlookSoutheast Asia 2006-2007, pp. 85 - 144Publisher: ISEAS–Yusof Ishak InstitutePrint publication year: 2006