WORKING WITH Income Gap
Economical issues, especially those relating to the management of oil and gas resources, are then given priority.
A colonial-era Oil Mining Ordinance 1958, which states that oil and gas assets found within 200 nautical miles of its waters belong to the state, is what Sarawak insists may be followed in order to regulate the use of these tools on its soil.
To ensure that the condition receives more than the current annual 5 % profits, the chief minister Abang Johari Openg’s state government wants to develop the six new oil and gas fields found in the West Luconia region and the Balingian state of the continental shelves in collaboration with Petronas. The condition government is requesting higher monthly payments, and Sabah, a neighbor, is also subject to the same restrictions.
Their needs have some significance. The federal government estimates that Sabah’s oil reserves make up about 18.8 % of Malaysia overall, with Sarawak accounting for 60.87 percent of those resources.
The Borneo bloc has been financially supporting Kuala Lumpur for decades, as evidenced by the more than RM50 billion ( US$ 10.7 billion ) in dividends from Petronas in 2022 alone. Kuala Lumpur would need to find new revenue sources to make up the shortfall in response to requests for a larger share of income under new profit-sharing agreements for oil and gas extracted from the two states.
Mr. Anwar may quickly find a solution to this conundrum in order to maintain Malaysia’s newly established social stability.
Senior correspondent Leslie Lopez for CNA Digital covers regional politics and financial interests.