Yong: Indonesian capital at East Kalimantan will bring more good than harm for Sabah

The impending relocation of the national capital of Indonesia from Jakarta to East Kalimantan in Borneo will bring more good than harm to Sabah. In view of the huge impact on the Borneo region, the actions and reactions of the authorities on the Malaysia and Brunei side will pre-occupy the respective governments for years to come.

The closer economic integration between Sabah and Kalimantan should not be a cause of concern to the Malaysian authorities because the prospect of economic integration in Borneo has already been envisaged when BIMP-EAGA (Brunei-Indonesia-Malaysia-Philippines – EAST ASEAN GROWTH AREA) was conceived more than 20 years ago. This regional growth triangle is similar to the IMT-GT (Indonesia Malaysia Thailand – Growth Triangle) at the other (Western) end of the Indonesian archipelago.

But it remains to be seen whether the economic activities spurred by the building of the new Indonesian capital and its surrounding areas will bring about the fruits that BIMP-EAGA has failed to do so after two decades.

Whereas political violence and instability in the Southern Philippines has affected the growth of BIMP-EAGA there, Kalimantan has surged ahead economically. One important reason why the Kalimantan provinces were able to grow and progress was the granting of “Otonomi” (Indonesian spelling) to the provinces whereby provincial governments were granted more decision-making powers and natural resources. This process of Otonomi started after the Suharto-era after the Asian Financial Crisis of 1998. 

As a Malaysian national paper has put it, the new Indonesian capital will be a “giant in our midst”. Therefore, now more than ever, we have to re-learn the concept of “prosper thy neighbour” that was first promoted by our Prime Minister in the 1990s during the establishment of BIMP-EAGA. The core idea of “prosper thy neighbour” is that a rich neighbour is better than a poor and troublesome neighbour.

Among the goodness that the new Indonesian capital at Kalimantan will benefit Sabah is to help, in a big way, reverse the flow of Indonesian illegal immigration to Sabah. This is the push-pull economic factor of human migration that is a natural phenomenon in world history.

At Kalimantan, from my observation, this reverse flow of migrants is nothing new. Years ago, when I visited Balikpapan, 4 shop assistants who saw me, called out my name. They later told me that they were formerly shop assistants at Milimewa (at Jalan Pantai, Kota Kinabalu). At an oil palm estate in neighbouring Nunukan, several estate supervisors are “ex-Malaysians” who are now rather prosperous in Kalimantan.

The economic spill over, in terms of trade in consumer goods, construction materials, quarry stones and cement, will continue to grow in the decades ahead. All these trade activities will bring about more connectivity in transport in the region. As Indonesia is a maritime nation, Sabah will need to boost up our own maritime sector, which is sadly primitive compared to Indonesia and Philippines.

Our ports at Tawau and Lahad Datu, including the Lahad Datu POIC port, will have to be greatly upgraded if Sabah were to take advantage of the surge in construction activities in Kalimantan.

At the same time, the island of Sebatik, off Tawau, can be developed as an entrepot for transhipment and repackaging of goods from other countries to Indonesia. This is because Sebatik Island is shared by Malaysia (Northern portion) and Indonesia (Southern portion).  

Among the well-known concerns of an exploding economy in Kalimantan is the possible deforestation and other environmental effects that might affect Sabah, like sending haze to Sabah. 

Finally, a word of caution here is in order. There is one remaining geo-political issue between Malaysia and Indonesia which is the overlapping claims to the Sulawesi Sea off the islands of Sebatik and Sipadan bordering North Kalimantan. Upon the Malaysian victory at the International Court of Justice in 2002 awarding Sipadan and Ligitan islands to Malaysia, both Malaysia and Indonesia awarded oil exploration rights to companies in the maritime area concerned. That overlapping claim and dispute has been put on the back burner for years.

The new location of the Indonesian republic at Kalimantan might bring this overlapping claim to the fore and become a hot potato in bilateral relations in the years ahead.    

Datuk Yong Teck Lee
SAPP President
Ex-Chief Minister, Sabah
Kota Kinabalu, Thursday, 5 September 2019