Kota Kinabalu: Sabah’s Gross Domestic Product (GDP) rose from RM77.80 billion in 2020 to RM84.30 billion last year, the highest recorded since the Covid-19 pandemic, said Chief Minister Datuk Seri Hajiji Noor.
This achievement reflects the effectiveness of the State Government’s fiscal policies, particularly in prudent revenue management and efficient collection systems.
“This demonstrates the resilience of Sabah’s economy despite global challenges such as geopolitical tensions, commodity market uncertainties and the overall slowdown of the international economy.
“For this year and 2026, the State’s growth momentum is expected to strengthen further through the implementation of high-impact projects, with a projected increase of between 1.5 and 2 per cent,” he said.
He noted that the State Government successfully managed inflation in an orderly manner, keeping Sabah’s inflation rate at 1.2 per cent last year – lower than the national rate of 1.8 per cent.
Hajiji said the achievement was also driven by government stimulus initiatives such as the Micro Credit Loan Scheme, which has empowered small and medium enterprises with total approved financing of RM2.37 million for 1,210 applications to date.
Looking ahead to the 13th Malaysia Plan (13MP) period from next year to 2030, he said Sabah remains among the states receiving the highest development allocations, amounting to RM6.9 billion for 2026 – a boost expected to accelerate socio-economic growth.
On June 4 this year, the State Cabinet approved a development expenditure ceiling of RM12.02 billion under 13MP, covering 1,173 programmes and projects – the highest in the State’s history, he said.
To ensure efficient service delivery, Hajiji said the Government has implemented a Good Regulatory Practice Policy aimed at enhancing the quality of regulations and eliminating those ineffective for the economy and public welfare.
“Over the past five years, 48 new and amended Bills have been introduced to meet these objectives,” he said.
He added that integrity efforts have been reinforced with the establishment of the Sabah Integrity and Governance Division (BIGoNS) on July 26, 2022, to oversee compliance with integrity standards across the public sector.
Digitalisation, he said, has also become central to more effective and efficient service delivery through the Sabah Data Integration and Interchange Platform (Sabah DIIP) developed under the State’s Digitalisation Strategic Plan.
“The Government has also recorded more than 10,000 active Google Workspace accounts for staff to enhance connectivity and productivity. A total of 290 system applications have been developed and implemented, while another 53 Public Service Digitalisation Projects are ongoing,” he said.
Hajiji highlighted that the Hala Tuju Sabah Maju Jaya (SMJ) 1.0 development plan – covering multiple economic sectors – has achieved significant results over the past five years, surpassing expectations.
In the agricultural sector, he cited a RM620 million investment in coconut cultivation and downstream industries by Linaco Resources Sdn Bhd as a key milestone.
“Sabah’s investment performance reflects investor confidence in the State Government and the efficiency of the civil service. From 2021 to the second quarter of this year, the manufacturing sector attracted RM24.9 billion in investments from 87 foreign and domestic investors,” he said.
Major high-value investments include RM4.29 billion from SK Nexilis, RM3.43 billion from SBH Kibing Solar and a three-phase RM6.59 billion project by Esteel Enterprise Sabah Sdn Bhd.
Petronas has also commenced operations at Sipitang Oil and Gas Industrial Park (Sogip), underscoring that investments in Sabah come from both domestic and international players.
“These investments have benefited the people of Sabah, creating more than 38,000 job opportunities for locals,” said Hajiji.
One of the State’s major milestones in the oil and gas sector was the signing of the Commercial Collaboration Agreement (CCA) between the Sabah Government and Petronas on Dec 7, 2021 – marking a new era in Sabah’s participation in the industry.
Following this, Sabah Energy Corporation (SEC) was appointed as the main gas supplier and transporter, now managing over 250 million cubic feet of domestic gas per day. The industry’s total annual revenue is expected to exceed RM2.5 billion, making it one of the State’s key revenue sources.
SMJ Energy Sdn Bhd, a wholly-owned State company, has also grown rapidly – increasing its value to RM5 billion within three years, with total assets of RM4.9 billion and profits of RM307 million, he said.
In the tourism sector, Hajiji said Sabah recorded 10.67 million tourist arrivals with total spending reaching RM23.42 billion between 2021 and this year.
He added that major tourism-based projects are underway by renowned companies, including Sheraton Hotel Kota Kinabalu, Club Med Borneo Kuala Penyu, InterContinental Hotel Papar, Hilton Garden Inn Resort Tuaran, Hyatt Centric Hotel Kota Kinabalu and Citadines Waterfront Hotel Kota Kinabalu.
“With an increase to 207 domestic and 126 international flights weekly at Kota Kinabalu International Airport (KKIA), Sabah remains a preferred destination, particularly for visitors from Brunei, China, Indonesia, the Philippines, Singapore, South Korea, Taiwan and Vietnam.
“The tourism sector’s growth has generated over 360,000 job opportunities since 2023, driven by the preservation of historical sites, upgrading of recreational facilities and urban beautification projects that benefit local communities,” he said.
Hajiji also reaffirmed the Government’s commitment to ensuring greater educational opportunities for Sabah youth to build a highly skilled workforce.
He said education funding has increased substantially over the past five years, with total scholarships amounting to RM1.02 billion.
“The State Government Scholarship allocation alone has tripled this year to RM145 million, benefiting 12,763 students,” he said, adding that 37 Unified Examination Certificate (UEC) holders were also awarded scholarships following the recent recognition of the qualification.
He said RM4.89 billion has been allocated for infrastructure management, particularly for roads, which expanded to 22,858km last year from 21,876km in 2021.
To address water supply issues, the number of Water Treatment Plants increased from 85 in 2021 to 90 last year, boosting treated water production capacity from 1,505 million litres per day to 1,630 million litres per day.
Ongoing projects include the Telibong II Water Treatment Plant Capacity Expansion, Beluran Water Treatment Plant Upgrade, Kanibongan Water Treatment Plant Upgrade and Kasigui Urgent Water Supply Scheme (UWSS).
“Another 18 projects, financed through an interest-free Federal Government loan worth RM320.25 million, are expected to be completed next year,” he said.
For electricity supply, Hajiji said the Sabah Energy Council has approved 11 projects with a total capacity of 1,219 megawatts, expected to be completed by 2031.
