A British colony for almost a century from 1888 to 1984, Brunei is now an independent state with a constitutional sultanate and over 600 hundred years of rule by a single family. A nation rich in petroleum and gas, Brunei’s economy has benefited greatly from profits from this industry. The country boasts one of the highest per capita GDPs in Asia.
Brunei’s transition to independence took several decades. In 1959, a new constitution was written declaring Brunei a self-governing state. However, the United Kingdom maintained responsibility for managing its foreign affairs, security and defence. An attempt in 1962 to introduce a partially elected legislative body with limited powers was abandoned when an armed resistance by the opposition party had to be controlled with the assistance of British forces. During this period, the Sultan also resisted pressure to join a newly formed Malaysia.
Brunei’s dynamic economy is comprised of foreign and domestic entrepreneurship, government regulation, welfare measures and village tradition. Crude oil and natural gas production account for over 50 per cent of its GDP and over 90 per cent of its exports. Considerable income from overseas investment supplements also benefit domestic production. However, recently, Brunei’s growth has fallen sharply. The government estimated a growth rate of only 0.4% for 2008 making Brunei’s GDP growth rates one of the lowest of ASEAN nations.
Brunei remains the third-largest producer of oil in Southeast Asia according to recent estimates and is also the ninth-largest exporter of liquefied natural gas in the world. Brunei’s economy is closely affected by the swings of the world oil market.
The government of Brunei provides all medical services and free education through the university level and subsidizes rice and housing. Although it outwardly encourages foreign investment, the country has expressed some concern that integration into the world economy will undermine its current social system.
Brunei joined ASEAN one week after gaining independence in 1984 and continues to regard its membership in the organization as the highest priority in its foreign relations. Brunei also joined the UN in September 1984 and is a member of the Organization of the Islamic Conference (OIC) and the Asia-Pacific Economic Cooperation (APEC) forum.
Drug trafficking and illegally importing controlled substances are serious offenses in Brunei and carry a mandatory death penalty.