By Yvonne Tuah
Across Sarawak, the signs of economic ambition are increasingly difficult to miss. Roads stretch into once-isolated communities, bridges span major rivers, digital growth reaches far and wide across generations, industrial sites take shape alongside new energy and tech projects that have the potential to reshape the State’s economic future.
At the heart of this transformation is the Post Covid-19 Development Strategy 2030 (PCDS 2030), a reengineered development blueprint spearheaded by Premier Datuk Patinggi Tan Sri Abang Johari. Shaped by the need to prepare for future scenarios, the strategy seeks to propel Sarawak towards high-income, developed status.
The numbers show, the State is maintaining its growth momentum despite external volatilities. According to the Department of Statistics Malaysia (DOSM), in 2025, Sarawak’s GDP expanded by another 3.6 per cent to RM153.5 billion, with its GDP per capita reaching RM73,757, above Malaysia’s RM59,167.
During the tabling of Sarawak Budget 2027 recently, Abang Johari projected economic growth of 4.5 to five per cent in 2026, followed by five to six per cent in 2027. The State was also estimated to collect RM13.571 billion in revenue in 2026, having garnered RM10.732 billion as of September.
But headline figures tell only part of Sarawak’s transformative growth. Is Sarawak simply growing or is it successfully remaking its economy?
As PCDS 2030 enters its final stretch, the more consequential test is whether this economic expansion can yield tangible dividends: more diversified revenue streams, better-paying jobs, stronger local industries, higher productivity and a better quality of life.
The ambition is therefore broader than simply ensuring Sarawak’s GDP continues to grow. It is an effort to alter the composition of the economy itself, by diversifying the State’s revenue streams, moving further downstream, strengthening services, improving productivity and encouraging innovation while creating more opportunities for households to share in the gains of growth across the State.
Value in numbers
SALIHIN founder and group managing partner Dato Dr Salihin Abang described the transformation of Sarawak as a meaningful shift in Sarawak’s fiscal capacity and in the role the State is prepared to play in shaping the economy. Since 2017, the State has broadened its revenue base and built or strengthened strategic platforms in areas such as energy, finance, ports, aviation and the green and digital economy.
However, he pointed out that while the first stage of transformation: stronger fiscal capacity, stronger institutions and greater influence over strategic economic levers, the next stage is more difficult as it is about translating those advantages into higher productivity, better-paying jobs, stronger local businesses and narrower development gaps.
“The transformation is real, but the real test is whether stronger State capacity translates into stronger household and private-sector outcomes.”
Community and business leader Dato Sim Kiang Chiok similarly viewed the transformation as a significant shift towards a more diversified, higher-value and increasingly self-reliant economy, with stronger State revenue providing a firmer foundation.
He noted that the State Sales Tax (SST) on petroleum products, introduced in January 2019, has become a major contributor to State coffers, with cumulative SST collected from oil and gas has reached RM24.77 billion by April 2026. This greater fiscal latitude, he said, gives Sarawak more room to pursue its long-term ambitions. The challenge now is ensuring that the benefits reach beyond the State’s balance sheet.
For Planet QEOS Sdn Bhd chief executive officer Dr Gabriel Walter, he opined the transformation has also been closely tied to energy.
“The Premier comes from a long line of politicians and leaders; masterful leadership is almost in his DNA. That capability, coupled with a humble willingness to read, listen, and learn until fully educated on an issue, sets him apart as an apex leader. He foresaw the low-carbon economy early in his tenure, creating global visibility and respect by committing to the hydrogen economy. He inherently understands that energy directly correlates to GDP – to increase wealth, energy generation must increase proportionately,” Gabriel commented.
He pointed out that while striving for economic wealth, the Premier also recognised that human capital is the ultimate engine of a new economy.
“The Premier’s emphasis on beefing up the quality of state education—most notably his landmark policy launching free tertiary education to fully fund students at state-owned universities—is extremely important. This aggressive investment in homegrown talent perfectly complements the technology and major infrastructure growth he envisions.”
By reinvesting State revenue into connectivity, rural development and education, he said, the Premier has proven to be a “once-in-a-lifetime leader capable of driving true technological transformation”.
Sarawak’s RM282 billion ambition
PCDS 2030 sets Sarawak’s 2030 GDP goals at RM282 billion, though worth lies as much in the journey, and in what reaches the people, as in the figure itself. Salihin Abang sees RM282 billion as a useful ambition for Sarawak, one that can sharpen execution and focus attention on what has to change. It is a stretch, he said, but Sarawak has solid footing to pursue it: room to sustain high development spending, and credit ratings that reflect strong finances.
He noted that Sarawak’s 13th Malaysia Plan shows that real GDP in 2024 was RM148.2 billion while DOSM reported that the State’s real GDP rose to RM153.5 billion in 2025. Therefore, reaching RM282 billion by 2030 would require average annual real growth of about 12.9 per cent over five years, significantly above the State’s recent growth rate.
Achieving that ambition would depend on turning projects in the pipeline into productive output across energy and downstream industries, manufacturing, commercial agriculture, logistics, digital services and tourism. Private investment and productivity would also need to accelerate, alongside the ability to sustain development expenditure in supporting Sarawak’s economic ambitions.
“If Sarawak reaches a somewhat lower GDP in 2030 but achieves much stronger real wages, household incomes, skilled employment, private investment and local-business competitiveness, that would still represent meaningful economic transformation. The quality and distribution of growth matter as much as the size of the economy.
“RM282 billion is a useful ambition, but the latest numbers make it a stretch target rather than an easy base-case outcome.” he said.
Salihin Abang also highlighted that based on current numbers, Sarawak has room to sustain high development expenditure, but within reason. The 2026 State Budget projects RM13.05 billion in revenue and RM12.91 billion in ordinary expenditure, with a separate RM9.3 billion for development through the Development Fund. In 2025, actual development spending reached RM9.8 billion, about 88 per cent of the revised development budget.
For him, sustainability depends less on an arbitrary spending ceiling than on project quality and the full fiscal picture. Major projects should be assessed not only on construction cost, but also on economic returns, future operating and maintenance costs, state-enterprise obligations, guarantees and downside scenarios such as weaker energy prices.
He also stressed on project selection, delivery and post-completion of projects.
“A ringgit that reduces logistics costs or unlocks private investment is very different from a ringgit that creates recurring costs without raising productivity.
“The question is not simply how much Sarawak spends, but whether each major investment expands the State’s productive capacity without creating hidden long-term obligations.”
Powering the pivot
Energy sits at the heart of Sarawak’s economic transformation strategy. The State is seeking to leverage its hydropower resources, existing oil and gas industry and emerging technologies to establish itself as a regional green energy hub, with the ambition of becoming the “Battery of ASEAN”.
Sarawak currently has three major hydropower plants at Batang Ai, Bakun and Murum. Sarawak Energy puts their combined large-hydropower capacity at 3,558MW, while the 1,285MW Baleh Hydroelectric Project is under construction and expected to be commissioned by the end of 2030.
Once Baleh is added, Sarawak’s large hydropower capacity will rise to about 4,843MW. The State is targeting 10GW of generation capacity by 2030 and 15GW by 2035, with a major part of the capacity mix coming from renewable sources.
Hydropower, however, is only one part of the equation. Sarawak is also expanding solar generation, including floating solar projects, and exploring battery storage and other technologies to manage a more diverse electricity mix.
“Abang Johari has been diligent and focused in getting the State machinery, policies, and laws ready for the new energy-based economy. Building a complete, bankable ecosystem takes years, and it is a good thing the Premier started this process many years ago.
“We are about to hit catalytic points,” Gabriel pointed out.
Of Sarawak’s two main renewable potentials, he said solar paired with Battery Energy Storage Systems (BESS) is the most commercially viable in the near term, citing its reliability, lower environmental impact and cost compared with new hydropower.
“The Baram area experiences constant, high solar irradiance year-round, offering enough high-irradiance land to produce the equivalent power of almost 400 Bakun dams,” he said, adding that utility-scale solar and storage could provide the reliable green energy needed to support new industries, modern agriculture and advanced infrastructure.
Gas, oil and a carbon wager
Sarawak is also leveraging on its gas industry to boost its energy production. With Petroleum Sarawak Berhad (PETROS) appointed as the sole gas aggregator with effect from February 1 2024, and formally recognised nationally in 2025, it has since stepped up its game in enhancing Sarawak’s gas industry.
The significance extends beyond the buying and selling of gas. The aggregator role gives Sarawak greater influence over how its gas is allocated between exports and domestic uses, including power generation and downstream manufacturing. The broader ambition is to extend the role of gas as feedstock and fuel to attract investment, expand downstream industries and create higher-value jobs.
One of the major projects in this push is the RM2.5 billion Miri Combined Cycle Gas Turbine (CCGT) plant, owned by PETROS and targeted for completion by the end of 2027. As of third quarter of 2026, construction has reached 63 per cent.
With a planned generation capacity of 500MW, the plant is designed to use a blend of 30 per cent hydrogen and 70 per cent natural gas. It will employ a gas turbine, a heat recovery steam generator and a steam turbine to supply electricity to the Sarawak grid.
Sarawak is also preparing to enter the carbon capture, utilisation and storage (CCUS) sector, with its first project targeted for 2028 and the Kasawari gas field identified as the site for a carbon storage initiative.
This collaborative project between PETROS, Petronas and Mitsubishi would form part of Sarawak’s broader efforts to strengthen its foothold in the emerging energy sector while advancing its target of achieving net-zero carbon emissions by 2050.
Beyond that, the oil industry remains an important part of Sarawak’s economic landscape. In July 2026, PETROS began production at the Adong Kechil West (AKW) field near Marudi, marking the return of onshore oil production in Sarawak after more than five decades.
Abang Johari had announced that the initial production was about 800 barrels per day, or approximately 24,000 barrels per month.
Together, these initiatives reflect an effort to secure greater value from Sarawak’s energy resources while building the capacity to support its next phase of industrial growth.
Shoring up ports
The handover of Bintulu Port from the Federal Government to Sarawak in September 2026 marked another significant development in the State’s economic ambitions, with the facility transitioning from a federal port to a State port.
The acquisition could strengthen Sarawak’s ability to coordinate its port network, support the energy transition and develop a more integrated logistics system.
Konsortium Bumi Group of Companies group managing director Dato Ir Janang Anak Bungsu, who is also a board member of the Kuching Port Authority, expressed confidence that this would be a source of income for Sarawak.
“Bintulu Port, I think, will now become another source of income for Sarawak, since we have taken it over. There are still many things that need to be considered, such as taxation and other matters, but the fact that the port now belongs to Sarawak means the Sarawak Ports Authority (SPA) has become an important authority to regulate it. We can now determine what each port should focus on – for example, what Bintulu Port should handle, and what kind of business we can develop in Samalaju.
“There is no longer a competition between Samalaju and Bintulu Port. The same applies to Tanjung Manis and Rajang Port. The question is: how can we make these ports more commercially active?”
Instead of having ports compete against one another, Janang opined that the focus should be on giving each facility a clearer role and specialisation. Better coordination could help improve commercial activity, strengthen logistics and support industries across different parts of the State.
Infrastructure a catalyst
Across Sarawak, infrastructure remains one of the most visible manifestations of the State’s development strategy.
The RM11 billion Coastal Road Network and Second Trunk Road projects paired with the 21 major bridges valued at RM6.92 billion and 122 crucial rural bridge projects under the Rural Bridge Transformation Programme (RBTP) with an allocation of RM396 million, are expected to bridge gaps between urban and rural areas as well as enhance connectivity along the coastal route of Sarawak, ensuring equal growth across the State.
Sim viewed this connectivity as a foundation for new economic and property activity.
“Good roads, bridges, ports, airports, water, electricity, telecommunications and public transport reduce the distance between people, businesses and markets. In Sarawak, this is particularly important because of our geographical size. Better connectivity can transform areas that were previously considered too remote or uneconomical for development into new centres of economic activity,” he said.
Sim also highlighted that Sarawak’s renewable-energy strategy and infrastructure drive could attract advanced manufacturing, downstream industries and modern technologies, creating jobs and driving demand for housing, supporting services and specialised property developments.
“Hydrogen, renewable energy, digital technology and advanced manufacturing can therefore create a new type of property demand. It will not only be demand for conventional housing, but also for industrial parks, logistics facilities, data centres, offices, worker accommodation, hotels, education facilities and supporting commercial centres,” he said.
The biggest opportunity, he pointed out, is to make sure that infrastructure development, industrial development and property development are planned together.
“We should not build housing first and hope the jobs will come later. We should create economic activity, employment and connectivity, and allow the property sector to grow around those economic engines,” Sim said.
Measure of success beyond 2030
Ultimately, the final measure of PCDS 2030 will not be found solely in GDP charts or the size of government revenue but whether the transformation produces better jobs, stronger businesses and tangible improvements in the lives of Sarawakians.
For Janang, he believed Sarawak is moving in the right direction.
“By looking at where we are now, yes, we are on track. I must give credit to the Sarawak government, which has consistently kept us informed of our progress and achievements.
“We have a far-sighted captain (Premier) steering Sarawak’s economy. But equally important are the people and institutions needed to support that,” he said.
The key enablers are in place, he added, and now the implementation agencies must work hand-in-hand with the Sarawak government to reach the goal of a high-income, developed State.
“We have the policies and frameworks in place to make it easier to do business in Sarawak. The public sector, private sector and government agencies must work together to turn these policies into reality. Ultimately, the private sector will be a key driver in implementing what the Government has set out to achieve, so this has to be a shared effort.”
For Salihin Abang, the assets and fiscal strength built in this decade should also make Sarawakians and Sarawak businesses more productive in the next.
“In the long run, prosperity will come less from what the government owns and more from the value that people and businesses are able to create on top of those assets.
“Post-2030, the emphasis should move from building the platform to maximising what Sarawakians and Sarawak businesses can create from it.”
For Sim, success beyond 2030 should be judged by a different yardstick, with the benefits felt on the ground.
“Ultimately, my hope is for a more prosperous Sarawak where people have a higher quality of life, good jobs, access to quality and affordable healthcare and education, and a safe and sustainable environment for the next generation.
“We should aspire not merely to become a richer Sarawak, but a better Sarawak — economically strong, environmentally responsible and inclusive for all Sarawakians,” he added.
Gabriel sees the destination in similarly ambitious terms.
“If I had to describe Sarawak in 2030 in one sentence, it is a state that can finally say: “Duduk sama rendah, berdiri sama tinggi” (standing shoulder to shoulder with giants).
“By building a bankable green energy ecosystem, pioneering firm solar power, and aggressively empowering our youth through free tertiary education, we are securing our place on the global stage as equals.
“In a tech-driven world of AI and robotics, the nation that combines cheap, reliable power infrastructure with a highly skilled ecosystem will come out on top. As long as we keep building firm power capacity with affordable renewable sources, our growth beyond 2030 will be unstoppable. We are definitely on an excellent trajectory.”
Real progress, not just promises
Across Sarawak, there is a growing sense of optimism about the State’s economic future. The foundations are being laid, investments are being channelled into strategic sectors, and infrastructure is being developed to improve lives while creating new sources of income and reducing reliance on external revenue streams. Under Premier Abang Johari’s leadership, Sarawak is staying the course towards a more diversified, resilient economy.
While challenges remain, particularly in developing the talent and expertise needed to sustain this transformation, the progress taking shape offers grounds for confidence. From energy and infrastructure to education and industrial development, the State’s ambitions are increasingly being matched by tangible investments and measurable outcomes. The road to 2030 will not be without its hurdles, but Sarawak is no longer speaking of its future in abstract terms. It is building towards it, one definite step at a time. – DayakDaily
