Brunei Darussalam in 2016: Adjusting to Economic Challenges

Abstract

Following the global drop in oil prices for three consecutive years, economic developments during 2016 demonstrated the fact that Brunei was adjusting well to the challenging economic environment. Oil and gas exports traditionally account for 65 per cent of the country’s gross domestic product (GDP) and for more than 90 per cent of government revenue. Due to the prolonged period of low oil prices, the country’s trade deficit was about B$2 billion in 2015, and by October 2016 total national exports stood at B$545.5 million, a decrease of 12.1 per cent from the figure in the same month in 2015. However, Brunei was fortunate that the pace of contraction was moderated as production output generated a 3.6 per cent rebound in GDP, mainly contributed by liquefied natural gas exports, which increased by 13.6 per cent in October 2016. However, as the non-oil and gas industrial sector’s contribution to GDP decreased, Brunei’s projected GDP growth for 2016 is only at 1 per cent, one of the slowest growing economies in Southeast Asia.