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Focus Malaysia
a day ago
- Business
- Focus Malaysia
Sabah's quiet surge: How the Land Below the Wind is stepping out of Sarawak's shadow
FOR years, Sarawak has been the economic success story of East Malaysia. Its commanding lead in oil and gas (O&G), infrastructure and state autonomy often made it the benchmark others aspired to. But that narrative is beginning to shift. Quietly but steadily, Sabah is emerging as a serious contender – and in some areas – it is already pulling ahead. In 1Q 2025, Sabah recorded RM10.9 bil in approved investments, the third highest in the country, trailing only Selangor and Kuala Lumpur. What's more telling is that 61% of these investments were foreign direct investment (FDI), indicating strong global confidence in Sabah's economic trajectory. By contrast, Sarawak's investment momentum has slowed with over 65% of its 2023 capital inflows coming from domestic sources. A manufacturing revival built on steel and glass This momentum is not isolated. It is matched by a manufacturing sector that is fast gaining national prominence. Sabah topped Malaysia's manufacturing investments during 1Q 2025 at RM7.3 bil. This is on the back of major investments prior led by major players such as China's Kibing Group which pumped in RM950 mil to expand its glass production facility in Kota Kinabalu Industrial Park. A massive RM31 bil green steel project by Esteel Enterprise is also underway in the Sipitang Oil and Gas Industrial Park. These moves signal Sabah's transition from raw commodity dependency to higher-value industrial activities, a transition that Sarawak began earlier but one Sabah is now accelerating with notable speed. Under Chief Minister Datuk Seri Hajiji Noor, Sabah has negotiated for equity stakes in key projects – including 50% in the Samarang offshore oil field, 25% in the SAMUR petrochemical plant and most recently, 25% in PETRONAS' RM13.7 bil nearshore floating liquefied natural gas (ZLNG) facility in Sipitang. These landmark deals not only promise long-term revenue streams but reflect growing confidence in Sabah's governance and regulatory clarity. ConocoPhillips' recent pivot toward Sabah's deepwater blocks also underscores a shift in upstream priorities. Tourism numbers back with a vengeance In terms of tourism, Sabah welcomed 3.1 million tourists in 2024, surpassing its own target and building on its post-pandemic rebound. While Sarawak registered higher total arrivals, Sabah's aggressive international marketing, direct flight connectivity and nature-based appeal are helping it capture a broader and more resilient tourist mix. New direct routes from Taipei, Busan and Fukuoka are boosting visibility and accessibility for both leisure travellers and investors. Crucially, Sabah's appeal lies in its diversity – from Mount Kinabalu and Sipadan Island to cultural trails and rural homestays. These offerings have been packaged with a more modern marketing push, including social media-driven campaigns, ecotourism showcases and strategic airline partnerships. Industry players are of the view that Sabah's branding feels fresher, more global and more connected to experiential travel trends driving today's tourism recovery. From most poor to most improved Beyond the headline numbers, Sabah's development push is showing up where it matters most – in households once left behind. In just over a year, Sabah slashed its number of hardcore poor households from over 22,000 in mid-2023 to just 1,464 by early 2025. By comparison, Sarawak still had over 17,000 such households as of May 2024. Sabah's targeted aid programmes, affordable housing roll-out and student support schemes have helped deliver tangible results. The numbers are not just statistics – they represent a shift in the lived realities of thousands. The Hajiji effect: Policy, pressure and delivery None of this happened by accident. Under the Hajiji administration, Sabah has streamlined investor approvals, set performance timelines and enforced implementation deadlines, even warning civil servants to act swiftly or face removal. The Sabah Maju Jaya plan is no longer a slogan; it is policy with teeth, backed by fiscal prudence and political stability. Sarawak still leads in areas like power exports and state reserves – and remains a vital engine of Malaysia's economy. But the data suggests that Sabah may no longer be playing catch-up. In fact, the next chapter of East Malaysia's development story may very well be written from Kota Kinabalu. For years, Sabah looked up to Sarawak's model. The view now is starting to level out. – July 29, 2025 Main image credit: New Malaysia Herald


Malaysiakini
16-06-2025
- Business
- Malaysiakini
Warisan rep demands proof of RM31b Esteel investment in Sabah
Sri Tanjong assemblyperson Justin Wong demanded that the Sabah state government provide clear evidence to support claims of a RM31 billion investment by Chinese firm Esteel Enterprise in the Sipitang Oil and Gas Industrial Park (Sogip). Wong (above), who is from the opposition party Warisan, said Sabah's Industrial Development and Entrepreneurship Minister Phoong Jin Zhe should stop making statements about the potential of the project unless he can prove its legitimacy.


Malaysiakini
16-06-2025
- Business
- Malaysiakini
Warisan rep demands proof of RM31b Esteel investment in Sabah
Sri Tanjong assemblyperson Justin Wong demanded that the Sabah state government provide clear evidence to support claims of a RM31 billion investment by Chinese firm Esteel Enterprise in the Sipitang Oil and Gas Industrial Park (Sogip). Wong (above), who is from the opposition party Warisan, said Sabah's Industrial Development and Entrepreneurship Minister Phoong Jin Zhe should stop making statements about the potential of the project unless he can prove its legitimacy.


Borneo Post
13-06-2025
- Business
- Borneo Post
Sipitang steel plant to show progress by July
Phoong KOTA KINABALU (June 13): Esteel Enterprise's RM31 billion steel processing plant at the Sipitang Oil and Gas Industrial Park (SOGIP) is expected to show visible physical progress by July this year. State Industrial Development and Entrepreneurship Minister Datuk Phoong Jin Zhe said the ministry recently received a formal letter from the company reaffirming its commitment to the project. Following the issuance of the Federal Manufacturing License in January 2025, Esteel quickly moved to sign a gas supply agreement with Sabah Energy Corporation and Petronas in February. Phoong said the months of March and April were dedicated to a competitive bidding process to appoint a joint tender (JT) contractor in China. This process concluded with the selection of China Communications Construction Company (CCCC) on May 30. 'This marks the official beginning of the project's implementation phase. Both Esteel and CCCC are confident that by July and August 2025, we will witness substantial transformation at the SOGIP site,' he said. Phoong, who is also Luyang assemblyman, criticised Elopura assemblyman Calvin Chong for politicising the matter and lodging a police report alleging a lack of progress at the site. 'As elected representatives, we can raise such issues during State Assembly sittings. There's no need to resort to police reports. Ask me in DUN — I am ready to answer any question about Esteel,' he said at a press conference at Wisma Kewangan today. 'Don't politicise genuine investors. It deters our efforts to attract more investments and grow the state's industrial sector.' He assured that the green steel manufacturing project will proceed as planned, stressing the strong commitment from both Esteel and the state government. Phoong also highlighted that the project has been thoroughly vetted by the Malaysian Investment Development Authority and the Ministry of Investment, Trade and Industry. He added that Esteel's parent company, Singapore-based GreenSteel Limited, is a legitimate entity — recently acquiring shares in Penang-based Southern Steel Bhd and already owning Antara Steel in Labuan.


Free Malaysia Today
05-06-2025
- Business
- Free Malaysia Today
Phoong's aide dares Warisan rep to raise steel project delay in state assembly
Sabah industrial development minister Phoong Jin Zhe previously said the delay in the RM31 billion steel project was due to setbacks in obtaining the necessary approvals and securing a supply of natural gas. (Facebook pic) PETALING JAYA : An aide to Sabah industrial development minister Phoong Jin Zhe has challenged Elopura assemblyman Calvin Chong to raise his concerns on the delayed RM31 billion Esteel Enterprise steel project in the state assembly. Chan Loong Wei said the upcoming state assembly is the right platform for the Warisan rep to voice out any issues he has with the project as an elected representative. 'If he is genuinely curious or wishes to seek accountability, I challenge him to raise this matter in the upcoming state assembly sitting,' he said in a statement. Chan, who is Phoong's political secretary, said Esteel Enterprise is a company that is owned by a credible Singaporean businessman, who also owned a Top 100 Private Company in China in 2023. 'They (Esteel) have real credentials and real capital. In fact, their acquisition of Southern Steel Bhd in Penang in October 2024 was widely reported in Sin Chew Daily and other business media,' he added. He said that Phoong remains committed to driving inclusive economic growth, creating decent-paying jobs for Sabah youths and turning the state into a competitive, investor-friendly region. Earlier today, Chong slammed Phoong's explanation of the delays in the Esteel Enterprise steel project, calling it 'misleading and irresponsible'. He also asked how such a major project could be announced in November 2022 without confirmed approvals, especially given the federal moratorium on manufacturing licences for the steel industry at the time. Chong called for the state government to disclose all agreements and terms involving Esteel Enterprise, saying the public deserved full transparency on a project of such scale. He also questioned the delay in implementation, noting that the manufacturing licence was only approved in January 2025, more than two years after the project was announced. On Monday, Phoong said the delay in the RM31 billion steel project was due to setbacks in obtaining the necessary approvals and securing a supply of natural gas. He said the initial projection for Esteel Enterprise's factory to begin operations in the fourth quarter of this year was based on the assumption that approvals would be obtained without delay. However, he said Putrajaya's two-year moratorium on manufacturing licences for steel-related industries created complications, with special approval only granted on Jan 24, 2025.