In increasing the drive towards diversifying the economy, the Investment Division under the Ministry of Finance is looking at investing in Piper Aircraft Inc, a 72-year-old general aviation company which is one of the three major US manufacturers of GA Aircrafts in Vero Beach, Florida, in hopes of stimulating activities in the field of general aviation for the country.
The investment would come under the Strategic Development Capital Fund (SDC Fund), which is under the Sustainability Fund Act.
The new area of investment was briefly revealed yesterday by Frances Ngau, a senior manager from the Investment Division, in her presentation at a forum on Land Optimisation Strategy for Industrial and Commercial Growth in Brunei Darussalam, organised by the Centre for Strategic and Policy Studies (CSPS) with SGS Economics and Planning Australia.
Another project that SDC Fund has undertaken is Vivapharm Brunei, an investment from our mandated fund of Aureos looking to set up a pharmaceutical manufacturing company in Brunei, which intends to be a leading manufacturer and supplier of halal-certified medicine, vitamins and nutrition not only for the local market but also in Malaysia, Indonesia, Singapore and the Middle East.
Said Miss Ngau, "Other investments that SDC has undertaken are Ghanim International Food Corporation, the distribution company for Brunei Halal products in collaboration with MIPR, BIG (Brunei International Gateway) in collaboration with the Ministry of Communications, DST and TelBru."
Earlier in her presentation, she explained, "The Sustainability Fund Order 2008 came into force March 11, 2008 and then the order was converted into the Sustainability Fund Act in March this year. Under Section 4 of the act, it provides for the establishment of a government trust fund known as Sustainability Fund and Government Trust Sub Fund of Fiscal Stabilisation Reserve, Retirement Fund and Strategic Development Capital Fund.
"The main objective of the SF Act is to facilitate the collection, accounting for and allocation of an appropriate portion of the three trust sub funds and to ensure the long-term sustainability of the finances of the Brunei government.
"The purpose of the SDC Fund is to provide risk capital for strategic local development that contributes to economic growth and diversification across various sectors and that broadens the revenue base of the government."
The eight identified target sectors for the fund, she outlined, were "Hospitality and Tourism, Financial Services, Business Services, Transportation and Logistics, Agricultural Products and Food Processing, Medical, Infrastructure as well as Education and Knowledge Creation.
"These are the target sectors in which Brunei is capable of establishing to stimulate the economy and diversify from oil and gas," she said.
In the evaluation and selection process, she highlighted "there are the various networks in government and private agencies as well as local companies looking at investment proposal. It goes through rigorous process of analysis evaluation".
"Firstly, the investment proposal provided by contacts, other ministries as well as departments will go through Analysis and Evaluation carried out by SDC Fund Manager with inputs from relevant ministries as well as departments. Then the proposal will move to the Investment Approval stage where the project will be presented to SDC Executive Board or Fund Manager BoD. After getting past this stage, there will be signing of investment agreements then performance monitoring and implementation," she explained.
SDC Fund comes in two different funds, namely Mandated Funds of Aureos and Imprimis to invest in companies which are aligned with SDC's objectives, while the Direct Investment is through SDC's vehicle, where we consider a proposal directly and to invest directly.
The sister fund of Aureos is a B$40 million fund that was established on January 22, 2008, looking primarily into Brunei-based SMEs sector and oversea SMEs which will create economic benefits within Brunei.
Similar to Aureos, only bigger, Imprimis Strategic Investment Cooperation is a B$310 million fund established in 2008. It looks at bigger projects like infrastructure, power, telecommunications, general aviation, aircraft manufacturing fixed base operations, pilot training facilities and others.
http://www.borneobulletin.com.bn/wed/oct26h9.htm
http://www.borneobulletin.com.bn/wed/oct26h9.htm
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