Brunei Increases ICT Push

On 12th December 2014, the Oxford Business Group issued this economic news update on Brunei:-

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Brunei Darussalam Increases ICT Push

Plans to stimulate Brunei Darussalam's ICT industry have been stepped up with the launch of a new broadband policy and the opening of a software development academy as the Sultanate works towards diversifying its economy away from oil exports through the creation of a knowledge-based economy.

In a bid to increase ICT usage and boost the sector’s contribution to the economy, Brunei launched its National Broadband Policy in November after work on the four-year strategy for broadband development began in May 2013.

With the policy, the government is hoping to increase the household penetration rate of broadband to at least 80% by 2017, from 31% for fixed broadband at present. Brunei's communications minister, YB Pehin Dato Abdullah Bakar, said earlier this year that the government is aiming to reduce prices for household high-speed internet to less than 3% of the average monthly income by 2016.
Cultivating start-ups

Like many other oil producing countries, Brunei as the third largest oil producer in Southeast Asia is working to diversify its economy, a move which has been compounded by the recent drop in global oil prices. The government has targeted increasing the ICT sector’s contribution to GDP from less than 2% at present to 6% by 2015. Currently, revenues from crude oil and natural gas exports account for more than half of GDP.

Brunei is also heavily investing in the sector. In the 2014/15 budget, transport and communications received the third-largest allocation of BN$226.6m ($177.81m), or 19.7% of total planned expenditures.

However, the government is keen to foster private-sector investment and partnerships, as well as drive research & development (R&D) in the space. One such initiative is the launch of the Brunei Solutions Development Centre (BSDC) in December, which will develop new software and application solutions for the government as well as serve as a training centre for the ICT industry, part of a broader government strategy to encourage more start-ups and rebrand Brunei as a regional force in ICT.

The ICT centre, which will be managed by a team from Microsoft, is expected to help overcome a skills shortage that has held Brunei's industry back. Demand for technology has exploded across Southeast Asia thanks to booming sales of smartphones and tablets, but only a few companies in the entire region have the expertise to offer high-end IT solutions.

“Our vision for the BSDC is that the local ICT industry can also start finding solutions outside the Brunei market,” said Mohd Norshafiee, director of the E-Government National Centre, at the launch of the centre where local ICT graduates and vendors will be trained under senior Microsoft architects.
"Made in Brunei" gets more funding

The training facility at the centre will feed into a range of government initiatives designed to rally Brunei's ICT sector as a strategy to diversify from the heavy reliance on local government ICT projects, as the wealthy Sultanate tries to leapfrog regional rivals that have made considerable progress in ICT, such as Malaysia and Singapore.

In June, the Authority for Info-communications Technology Industry (AITI) announced it had signed an agreement with Singapore-based consultancy IDA International for services to develop a national ICT manpower master plan in a bid to accelerate the development of ICT professionals. Although the government has done an impressive job of laying down modern infrastructure and providing incentives for IT start-ups, one of the primary hurdles that remains is attracting and retaining enough qualified workers in the private sector.

Meanwhile, it is striving to introduce more "Made in Brunei" products. AITI opened another round of funding to promote research & development (R&D) activities by local businesses in November with 12 ICT companies in Brunei having received grants under the scheme since its inception in 2010.

There are concerns, however, that local ICT businesses are too reliant on the government and foreign expertise, while "Made in Brunei" products are few. "The majority of these companies are resellers, distributors and hardware vendors, which import hardware and software from overseas, and resell them to consumers in Brunei," said Siti Zaraura Hj Mohammed, senior manager at AITI's Industry Development Group. She added that the remaining half of the ICT companies – around 200 in total − are in dormant state or inactive, prompting a sector-wide accreditation scheme.

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