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New Zealand has always maintained friendly relations with Brunei. Much of the past contact has been related to Brunei's membership of ASEAN. The end of Brunei’s three-year role as New Zealand’s ASEAN country coordinator in July 2000 coincided with the 25th anniversary of NZ-ASEAN Dialogue relations.
New Zealand and Brunei enjoy a degree of cooperation in many areas including trade, investment, education and defence. The New Zealand High Commissioner in Kuala Lumpur is accredited to Brunei. Pengiran Datin Paduka Hajah Masrainahand is the Canberra-based . New Zealand also has an Honorary Counsel in Brunei, Mr Daniel Ng.
Brunei nationals visiting New Zealand for periods of up to three months do not require a visa. In 1999 Brunei extended its visa waiver for New Zealand citizens visiting Brunei from 14 days to 30 days.
In 2004, the newly formed New Zealand Association in Brunei was officially registered. The Association aims to represent the interests of the expatriate New Zealand community in Brunei and to be a focal point for social and community activities. The Association can be reached at: www.groups.yahoo.com/group/NZinBrunei
The value of New Zealand’s exports of goods for the year to December 2005 was $3.3 million. This figure has decreased since 1995 when exports were valued at over $16 million. The main export is dairy products, valued at over $1.5 million, and makes up over 50% of New Zealand’s total exports to Brunei. This is followed by iron and steel exports, worth $713, 000 for the year to December 2005, compared to $ 611,000 in 2004.
New Zealand imports from Brunei vary widely from year to year. Imports for year ending December 2005, made up nearly exclusively of petroleum products, were valued at $138.6 million. This is a 46% decrease from 2004 but still larger than the 2002 figure of $67 million. Non-petroleum imports to December 2005 amounted for less than $10,000.
The level of Brunei investment in New Zealand is not recorded, partly because much of it enters indirectly via Singapore institutions.
As mentioned above, Brunei is involved in the current ASEAN/CER FTA negotiations – which include New Zealand, and is a party to the Trans-Pacific Strategic Economic Partnership (TPSEP/P4) – with New Zealand, Singapore and Chile. Brunei, unlike Singapore and New Zealand has yet to ratify the agreement.
New Zealand and Brunei signed a liberal Air Services Agreement in March 1999 replacing a 1995 Agreement. Along with Chile, Singapore and the USA, Brunei and New Zealand are partners in the Multilateral Open Skies agreement, which was signed in Brunei during APEC in November 2000.
In October 2003 Royal Brunei Airlines (RBA) began a four flight per week service to Auckland, via Brisbane. In November 2004, RBA cut back their flights to New Zealand from four to three per week, due to cost considerations.
New Zealand has a small but significant defence relationship with Brunei. Military exercises, training assistance and annual discussions under the Mutual Assistance Programme have helped to develop a relationship of substance and value for both countries.
In 2004, there were 28 Bruneian students studying at New Zealand tertiary institutions. Otago University has a Memorandum of Understanding with Brunei under which it takes a small number of medical and dental students. Lincoln University also has links with Brunei.
Brunei regularly recruits New Zealand teachers, and more than 50 are currently working there. New Zealanders are also employed in the oil, construction, health and airline sectors.
Given Brunei’s dependence on imports and corresponding low tariffs, New Zealand experiences few trade access problems with Brunei. In recent years, Brunei has sought to expand the economy’s base to decrease its reliance on fossil fuel exports. Brunei has encouraged the development of other industries and in some cases has imposed import restrictions to assist this development.
Land Area - 5, 700 sq km - Population - 351,000 (2003 est) - Capital City - Bandar Seri Begawan - Religion - Islam - Language - Bahasa Melayu / English
Political system - Sultanate - Head of State and Government - HM Sultan Hassanal Bolkiah
GDP - Br$8.9 billion (2004) - Real GDP Growth - 3.0% (2005 year, est) - Exports - Br$8.563 million (2004) - Imports - Br$2.4 million (2004) - Main exports - Crude oil and Liquefied Natural Gas - Unemployment rate - 4.6% (2003 est) - Inflation - 0.3% (2003)
NZ Exports (FOB) - NZ$3.3 million (year ending December 2005) - Main Exports - Dairy – mainly butter and cheese (over 50% of total exports) 127% increase over the last year, Iron and Steel articles (27% increase), Birds eggs, in shell (47% decrease) - NZ Imports (CIF) - NZ$139.6 million (year ending December 2005) - Main Imports - Crude Oil (nearly 100% of total imports). This decreased by 46% in 2005
New Zealand maintains a friendly, if low-key, relationship with Brunei. Much of the past contact has been in the context of ASEAN (Brunei was New Zealand’s ASEAN country coordinator from 1997-2000) and the Commonwealth. These ties have helped efforts to strengthen the bilateral relationship, which now covers many areas including trade, investment, education and defence.
Two way trade between New Zealand and Brunei is modest (our 48 th largest bilateral trading partner), with trade totalling NZ$141.9million for the year ending December 2005. New Zealand’s exports to Brunei reached a peak of NZ$16 million in 1995, but have dropped to around NZ$138.5 million, year to December 2005, a 46% decrease. Imports from Brunei are nearly exclusively crude oil, the volume of which fluctuates from year to year. Crude oil imports year to June 2004 reached NZ$281 million compared to NZ$67 million in 2002.
The level of investment from Brunei in New Zealand is not recorded, partly because much of it enters indirectly via Singapore institutions.
From the 14th to the 16th centuries Brunei Darussalam was the seat of a powerful sultanate extending over the island of Borneo and the lower Philippines. By the 19th century, the Brunei Darussalam Empire had been whittled away by wars, piracy and the colonial expansion of European powers. The current Sultan represents one of the oldest continuously ruling dynasties in the world.
In 1847, the Sultan concluded a treaty with Britain and in 1888 Brunei Darussalam officially became a British protectorate. In 1906, the Residential System was established in Brunei Darussalam. A British Resident was nominated as a representative of the British government to advise the Sultan in all matters except Malay customs, traditions and Islamic religion.
Brunei gained limited self-governance in 1959 and full independence in 1984. The 1959 Constitution established a system of five governing councils, including a Privy Council, an Executive Council and Legislative Council. In 1962, elections were held for the Legislative Council for the first (and only) time. The Parti Rakyat Brunei (Brunei Peoples Party – PRB) won a landslide victory, but was prevented from forming a government. The PRB staged an armed rebellion, which was put down with the help of the British Army Gurkhas. The Parti Perpaduan Kebangsaan Brunei (the Brunei National Solidarity Party) is now the only legal political organisation in the country.
The Legislative Council was suspended in 1984. The Council of Ministers became the supreme governing council, presided over by the Sultan. The Sultan, since the aborted rebellion in 1962, rules by emergency decree. He is also the Head of State, Finance Minister, Defence Minister and decides official policy with his family and advisers.
In September 2004, Sultan Hassanal Bolkiah, announced that the Legislative Council would be reconvened. top of page
In recent years, religion has played an important role in shaping Brunei. ‘True Islam’ is presented as synonymous with the rule of the Sultan. The national ideology is espoused though Melayu Islam Beraja (Malay Islamic Monarchy, or MIB) which supports absolute monarchy though a fusion of Islamic values and Brunei Malay culture.
With the Sultan’s absolute rule and proscription of political parties there is little political activity. The only registered political party keeps a low profile. In 1993 the Mukim (district) and Kampong (village) Consultative Council was established in order for the people to air their views and concerns to the government though locally elected village officials.
In February 2002 the government stated that there were no groups or individuals in Brunei with links to terrorism. Brunei has also tightened up security in the country and clamped down on illegal immigration.
As noted above, in September 2004, Sultan Hassanal Bolkiah, announced that the Legislative Council would be reconvened. Local media reported that the Sultan has stated he is aiming for greater transparency in political decisions and increased participation by the people of Brunei.
Brunei ’s GDP per capita, at around US$13,000 ppp, is second only to Singapore within ASEAN. But with a population of around 351,000 citizens (plus a significant number of foreign workers, ~100,000 in 2003) Brunei’s economy is small, ahead of only Cambodia and Laos in the region, as measured by GDP. GDP growth is estimated to have grown 3% over the 2005 period from 1.3% last year.
The oil and gas sector forms the backbone of Brunei’s economy, worth around 40% of GDP and some 88% of exports. But Brunei’s oil and gas reserves are conservatively estimated to last only another 20 years. However, new deep-water exploration areas – the ownership of which is contested with Malaysia – hold further potential. Of the remaining 60%, non-oil related, economic activity, the government comprises around 40% and the private sector around 60%. Small-scale manufacturing and primary production are the predominant non-oil sectors.
The government is taking a proactive approach to diversifying the country’s sources of economic growth. The Brunei Economic Development Board (BEDB), formed in 2001, aims to attract FDI and promote joint ventures – targeting US $4.5 billion in new investment and at least 6,000 new permanent jobs by 2008 . BEDB has a two-prong strategy. First to develop a number of industry clusters, including tourism, transportation and logistics, and financial services (with progress already in establishing an International Financial Centre and strengthening Islamic banking). The second strategy has two parts. The first is to develop oil and gas-related downstream activities at Sungai Liang – proposals include urea and ammonia plants, an aluminium smelter, and a tyre recycling facility. The second is to develop a port and industrial complex at Pulau Muara Besar. A recent independent report commissioned by BEDB points to a number of weaknesses in the economy, including slow government decision making and red tape and a poorly developed local private sector, that present challenges to implementing the Government’s vision.
A programme of government spending has boosted the private sector, which suffered a serious slump after the 1997 Asian economic crisis and the 1998 collapse of Amedeo. Under the 8th National Development Plan, 2001-2005, the government provides around B$1 billion for projects including in social services, public utilities, information, science and technology, security, infrastructure and job creation. Underspend of allocated monies is a problem the government is attempting to address. The budget allocation for 2004/2005 includes B$900 million for 480 projects under the 8th National Development Plan.
Although the official unemployment rate is relatively low, a number of government and private sector initiatives have been set up to try and counter an increasing number of unemployed graduates. Foreign workers make up approximately 40% of the workforce.
Japan accounts for around 40% of Brunei’s exports; ASEAN for approximately 20%; Australia, Korea, China and the US are also important destinations. The Brunei market is highly import-dependent with few tariffs or other trade barriers. Brunei imports almost half of its goods from ASEAN neighbours, with the US, Japan and the EU accounting for around 10% each.
Brunei became a member of the Commonwealth and ASEAN at independence, and has subsequently become a member of both the United Nations and the Organisation of Islamic Countries. In 1993 it acceded to the GATT, and in 2000 Brunei hosted and chaired APEC.
Brunei attaches the highest importance to its ASEAN membership and has participated actively in that organisation. Brunei hosted the ASEAN Leaders Summit (and ASEAN+3) in November 2001, and hosted the ASEAN Post Ministerial Conference and ASEAN Regional Forum in July/August 2002. It has close economic links with Singapore – and the currencies of the two countries are pegged.
In December 2002 Brunei also signed a Trade and Investment Framework Agreement (TIFA) with the US. The TIFA aims to improve trade and investment in areas such as intellectual property, information and communication technology, biotechnology and tourism. Brunei is involved in the current ASEAN/CER FTA negotiations, and an observer in the current Pacific Three (P3) FTA negotiations – with New Zealand, Singapore and Chile.
Brunei is positive about the development of closer relations between ASEAN and China, Japan and South Korea (ASEAN+3) and sees the institutionalisation of the process as a natural evolution. Brunei is also a member of the Brunei Indonesia Malaysia Philippines – East Asian Growth Area (BIMP-EAGA), which seeks to progress economic growth and development in the ASEAN sub-region.
The royal family has also maintained strong personal links with Britain, and also with the Malaysian ruling families. A British Ghurkha unit is still used to guard the main oilfields area, and Britain helped recruit another Ghurkha unit directly employed by the Brunei Government as part of its own defence forces.
The bilateral relationship has been cemented by the number of high-level New Zealand visits to Brunei and vice versa. These include two visits to New Zealand in 1995 by the Sultan and Prime Minister of Brunei, HM Sultan Haji Hassanal Bolkiah. His Majesty the Sultan also attended the APEC Leaders’ Meeting in Auckland in September 1999. In March 1999 the Brunei Minister of Communications visited New Zealand to sign the “open skies” Air Services Agreement. His Royal Highness the Crown Prince of Brunei also visited New Zealand in March 2003.
Most recently, Hon Trevor Mallard visited Brunei for the Commonwealth Finance Ministers’ Meeting, in September 2003. The highest-level visit from New Zealand, by the Prime Minister, Rt Hon Helen Clark, took place in November 2000 for the 8th APEC Leaders meeting. Other New Zealand Ministers to visit Brunei include Hon Phil Goff, Hon Jim Sutton, Hon Dr Michael Cullen, and Hon Pete Hodgson.
The Safetravel website provides a travel advisory for travellers to Brunei [external link].
