Labuan IBFC contributes more than Rm900mil to national coffers

LABUAN: The Labuan International Business and Financial Centre (Labuan IBFC) contributed more than Rm900mil to the nation’s fiscal revenue collection for 2021, according to the Labuan Financial Services Authority (Labuan FSA).

Director-general, Nik Mohamed Din Nik Musa said being an international financial centre, Labuan IBFC is becoming one of the key components of Malaysia’s economy in line with the government’s aspiration.

He said the business and financial activities of Labuan IBFC had contributed significantly to the economic growth of Labuan, contributing more than 60% towards the island’s gross domestic product, thus, becoming one of Labuan’s largest employment providers, with more than 6,000 people employed in Labuan IBFC.

“This contributed to more local spending and spurred other economic spin-offs on the island,” he told Bernama yesterday.

The achievements of the Labuan IBFC were made possible with Labuan FSA being the key driver in the growth of the jurisdiction.

Nik Mohamed Din said over the past 30 years, the progressive guidance of Labuan FSA had been instrumental in charting the progressive development and growth of Labuan IBFC, contributing significantly to the physical and socio-economic development of Labuan.

Labuan FSA is a statutory body (under the Finance Ministry), responsible for the development and administration of the Labuan IBFC.

“As Labuan IBFC enters its fourth decade as a pioneering financial intermediation centre, its reputation as one of the prominent and innovative international centres within Asia continues to grow,” Nik Mohamed Din pointed out.

“The culmination of the three-decades worth of forward-looking strategies, innovative measures and impactful action plans that Labuan FSA has nurtured, led to the evolution of Labuan IBFC into the internationally renowned, award-winning pillar of growth as weseeittoday,”hesaid.

Nik Mohamed Din said Labuan IBFC had persevered through many challenges and hurdles throughout its journey, including the global financial crises of 1998 and 2008.

“The crises had triggered a wave of global stability measures, particularly on the regulatory fronts that had reshaped the international financial landscape.

“Acceleration of globalisation, financial market integration and recalibration due to the financial crises, and technology advancement and disruptions, have been foremost in driving the changes in the business landscape of Labuan IBFC,” he said.

Nik Mohamed Din said the Covid-19 pandemic has profoundly impacted the international markets and global economies and tested the robustness and resilience of the Labuan financial system.

“Notwithstanding the challenging externalities and intense global competition, Labuan IBFC weathered the storms and continued to grow,” he noted.

Nik Mohamed Din said during the inception years of Labuan IBFC, Labuan FSA focused on building the foundation to provide a conducive business environment with the necessary physical infrastructure and attractive fiscal incentives to draw critical mass to the shores of Labuan.

“Efforts were also directed at developing the regulatory policies and framework to attune with international best practices,” he said. — Bernama