Gaya Travel team talks to the Chief Executive Officer of Labuan Corporation, Dr. Fary Akmal Osman, about what the island is doing to stay relevant and competitive.
Prior to her role as the CEO of Labuan Corporation – the body that administers Labuan island – beginning from July 2019, Dr Fary Akmal Osman was attached to Malaysia’s Ministry of Finance, where she was more involved in formulating policies. “Being posted to Labuan allows me to see whether all policies developed at the high levels of government can be applied at ground level. I am now in a position where I can see whether those policies work on the ground and if we need to make necessary adjustments
Labuan Corporation is pro-investment and pro-business, responsible for hooking up investors with relevant Malaysian government agencies to set up business on the island. As a matter of fact, Labuan as a Federal Territory has the second-highest GDP per capita in Malaysia with an economic value of MYR7.2 billion, right after Kuala Lumpur-Putrajaya. Labuan even hosts PETRONAS Chemicals Methanol Sdn Bhd, the fourth largest methanol production facility globally and major economic contributor to the island. To protect the methanol production facility, including other assets like ships, ports, and infrastructure, maintaining the island’s safety and security is crucial. “I honestly did not expect all this to be on my shoulder,” laughs Dr Fary.
When Dr Fary first entered the Malaysian public sector, she served at the Ministry of International Trade and Industries under the demanding leadership of Tan Sri Rafidah Aziz, who was the minister from 1987 to 2008. Dr Fary was then posted to Bangkok to join the United Nations, followed by the completion of her studies in Japan after receiving a scholarship from the International Monetary Fund. Over the years, Dr Fary has been able to build her network locally and internationally, which she intends to leverage to promote Labuan. “Labuan Corporation plans to conduct a business and investment seminar in August 2020, first targeting Japanese companies in Malaysia to visit Labuan to discover business and investment opportunities available on the island, while boosting tourism at the same time,” she reveals.
Being the CEO of Labuan Corporation requires Dr Fary to deal with a set of new challenges. Her current job scope increases exponentially compared to her previous post in the Ministry of Finance because it now includes other areas namely tourism and local government, apart from financial matters. However, she welcomes them as opportunities for her to learn new things.
“When I first came to Labuan, I thought my role would be more of attracting investments and development into Labuan, but turns out I am required to oversee issues related to local government and authority as well such as waste management, drainage, community safety and even housing. I sometimes feel like a city mayor since I need to look into the island’s public administration. In a month, I could be attending up to 74 meetings. I even held a coordination meeting involving 81 government departments at once, almost similar to administering a small state – all these departments are present in Labuan due to the island’s status as a federal territory in Borneo. I am chairing the disaster preparedness and management committee for Labuan too,” Dr Fary elaborates.
Labuan Corporation proactively collaborates with all of the 81 government departments by asking each one of them to hold at least three meetings or functions in Labuan per year. “When the meetings are held in Labuan, they help the local economy. It is not necessary for them to come to Labuan in large numbers at one go; instead, these officials can spread out their visit to Labuan throughout the year,” she adds.
The communities in Labuan have been supportive of Labuan Corporation’s initiatives. “I receive strong support from the people of Labuan since they notice how aggressively I try to promote the island, especially from the Village Heads. We empower the local communities to nurture communal spirit by holding competitions, for instance, ‘The Most Beautiful Village’ and ‘Most Beautiful Community Lighting’, including the Labuan Pearl Awards to recognise the contributions and support shown by the media, industry players and non-governmental organisations. Such initiatives help to make the island livelier,” states Dr Fary.
Labuan Corporation’s main emphasis is on improving the locals’ living standards. “Enhancing the locals’ economic standing is crucial because they are the ones who remain in the place, while high-paying expatriates who work on the island tend to spend more outside by flying to Kota Kinabalu or Kuala Lumpur at every chance they get. Moreover, expatriates leave the island once their tenure is over,” she explains.
The majority population in Labuan comprises civil servants and those classified under B40 (bottom 40%) group, so it is crucial for Labuan Corporation to help raise their income level. Plans are afoot to help them form small and medium enterprises (SMEs), assist them in training and packaging, improve the quality of their products, and teach them how to sell their products and services online by working together with Malaysia Digital Economy Corporation. Labuan Corporation has secured funding for those plans and waiting for the moment to execute them, especially after the Malaysian government lifts the Movement Control Order, which restricted everyone’s movement to halt the spread of COVID-19.
Several SMEs in Labuan have come up with popular products like virgin coconut oil, tuna satay, and anchovies, which locals catch using bagang, a platform constructed above water equipped with hoistable nets. The anchovies caught are then cleaned, processed, dried, packaged and sold, consequently boosting the locals’ income. Labuan Corporation has identified 13 bagang operators in Labuan to be given the opportunity to enhance their business and earn between MYR3,000 to MYR10,000 per month.
Dr Fary is keen in raising Labuan’s profile internationally by urging the locals to improve their skills and standards. “We are late in the game when it comes to developing the people of Labuan, who need to upskill themselves so as to take advantage of the presence of the oil and gas industry on the island, for example professionals who are involved in drilling underwater can command up to MYR18,000 per month. People should focus on specialised and niche skills to obtain high income. Once the locals gain better education and exposure, obtain higher income and purchasing power, resulting in better living standards, they would be ready to move towards Industrial Revolution 4.0 and embrace technology in daily life,” she deduces.
Another strategy is to attract more people to reside in Labuan. Labuan Corporation envisages the island to have a more diverse population while ensuring locals are cared for. To that end, Labuan Corporation proposes the setting up of more academic institutions on the island, with Universiti Malaysia Sabah’s Labuan International Campus as the catalyst. However, buy-in and support are still required from the Ministry of Higher Education and Ministry of Science, Technology and Innovation for the project to get off the ground.
“I want to turn Labuan into a centre where the oil and gas industry, including shipbuilding, can apply Internet-of-Things (IoT) and robotics. Since Labuan is small and easy to monitor, it can be used as a technology-testing hub, perhaps for drones and underwater robotics related to shipping, oil and gas. Once businesses have done their testing in Labuan, they can use their findings to develop their own standard operating procedures and implement them. Conversely, Singapore is testing the use of drones to deliver parcels; maybe Labuan can be a base for conducting such a test. There is no need to build new infrastructure for this project, but the concept of creating a science and technology-based testing centre requires support from the government,” Dr Fary proposes.
Labuan Corporation has developed a blueprint and guideline to switch Labuan into a smart island city encompassing the implementation of e-mobility, e-wallet, drone-monitoring and low-carbon schemes. “What could work for the island are smart parking, closed-circuit television system, and e-payment. As a matter of fact, we have implemented e-payment for the ferry service,” she continues.
For the island to advance technology-wise, the locals need to change their mentality and be comfortable with technology as a means to improve their living standards. “Otherwise, how would we be able to progress and adopt new technologies such as e-payment and e-wallet? The last time when I was in Geneva, I noticed its residents pay for public transport access directly from their smartphones. Hopefully, we can somehow implement such facility in Labuan,” notes Dr Fary.
Tourism is important to Labuan because it generates high multiplier effect. Since tourism can spin off various businesses, Labuan Corporation decides to diversify its economy for the benefit of the locals. “I arrive at a critical point when Labuan needs to make that transition,” observes Dr Fary.
Labuan used to do well as an offshore oil and gas hub, alongside shipping, finance and insurance. During the oil and gas boom, all types of lodging were dominated by the players and professionals from those industries, so facilities were just enough to meet their needs but not tourist-friendly. Only a small number of repeat tourists came to Labuan for two to three months to enjoy the island’s laidback lifestyle. However, the slowdown of the oil and gas industry results in an excess of accommodation supply, hence the need to encourage more tourists to come to Labuan.
Labuan has all the potential to be one of Malaysia’s leading tourism destinations. The island has its own strengths that can be carved into niches, for example, World War II tourism and historical sites, including wreck-diving.
Labuan Corporation initially intended to bring in charter flights to come to Labuan during weekends and increase the number thereafter. “We are targeting charter flights from Jakarta, Singapore and Bangkok because these three capital cities have a large expat population, who might be interested in scuba diving, especially shipwreck diving. After talking to divers, there could be more than five shipwreck diving spots around Labuan,” claims Dr Fary.
“We are applying for Labuan to be listed as a UNESCO Geopark since the island is home to six ancient geological sites. Four of those sites possess rock formations as old as 15 million years, located on the main island. The other two, believed to be 45 million years old, can be found on neighbouring Rusukan Besar and Kuraman islands, which are part of Labuan,” she beams.
As preparation for Labuan to be certified as a Geopark, it is important for Labuan Corporation to develop succinct information panels, educate the locals and instil the feeling of ownership among them to care for the island’s geological heritage.
To further promote Labuan, Labuan Corporation plans to do engage with the media and key opinion leaders by inviting them to take part in familiarisation trips to the island. There is even a plan to bring diplomats from 40 countries to Labuan to promote the island for trade, oil and gas, financial services and tourism, but postponed at the moment due to the COVID-19 pandemic.
Once the COVID-19 threat dies down, Labuan will rebuild its tourism industry, starting with domestic tourists. “Labuan is a beautiful island with heritage but underpromoted even to Malaysians residing in Peninsular Malaysia, therefore it would be wise to focus on the domestic market first. We can sell more of Labuan now because we have developed the necessary tourism packages, including the upcoming Geopark sites in Labuan. We have signed up with KLIA TV to broadcast our promotional messages through its 380 screens throughout KLIA and KLIA 2 for one year, which will be reactivated once the MCO is over,” shares Dr Fary.
Regarding visitors from Peninsular Malaysia, Seri Paduka Baginda Yang Di-Pertuan Agong (The King) Al-Sultan Abdullah Ri’ayatuddin Al-Mustafa Billah Shah ibni Almarhum Sultan Haji Ahmad Shah Al-Musta’in Billah had also visited Labuan in 2019. As a matter of fact, His Majesty might return together with Raja Permaisuri Agong (The Queen) Tunku Hajah Azizah Aminah Maimunah Iskandariah binti Almarhum Al-Mutawakkil Alallah Sultan Iskandar Al-Haj to launch Labuan International Golf Club, popular among Korean students for training golf. “During His Majesty’s second visit, we decide to bring His Majesty to the sandbar on Rusukan Kecil island to witness marine life. Since my team and I are experienced in handling protocol for VVIPs, Istana Negara (The National Palace) has confidence in Labuan Corporation to take care of The King and The Queen, whose visit will surely boost the people’s morale,” she assures.
Travellers from Sabah and Sarawak, including neighbouring Brunei, are willing to come to the island, especially to join sporting events such as duathlon, cycling, marathon and Labuan Sea Challenge. As such, Labuan is ideal as a sports and wellness destination because many sporting events can conveniently be held on the island due to its manageable size.
“In 2019, we used to have 60 tourism-related events. For 2020, we have outlined 130 events. However, due to the COVID-19 outbreak, we are forced to cut back on the number of events in Labuan for the remaining of the year,” sighs Dr Fary.
To make Labuan more attractive as a tourism destination, an MYR100 million theme park together with a hotel and resort in Tanjung Aru will open in the later part of 2020, expected to benefit the locals in terms of employment and spin-offs. Besides, in two years’ time, Malaysia’s first duty-free premium outlet will be inaugurated in Labuan. Located behind Labuan International Golf Club, earthworks and construction on the premium outlet have already begun. “Once the project is completed and the international brands are brought in, tourism in Labuan is bound to climb another notch,” she foresees.
Finding peace in Labuan
“Though my work in Labuan keeps me busy, everywhere I go in Labuan, I get to see the beach, which gives me peace of mind. The island also boasts places to view the amazing sunset. Even the view at night is pleasing due to the lights coming from the nearby rigs,” says Dr Fary.
Dr Fary’s favourite spot in Labuan is Tanjung Kubung, close to Labuan’s icon The Chimney. The place has rock formations and a cave, surrounded by water replete with sea urchins and sea cucumber. There is even a coal mine near The Chimney that has been in existence since 1847.
“When you go to the smaller islands surrounding Labuan, you get to see turtles and stingrays, including other marine life, due to the clear water, even at the depth of 20 metres. You could even see marine life from the jetty on Rusukan Besar, whereas the only 1.2-kilometre long sand bar known in Malaysia lies on Rusukan Kecil. If you were to stand on the sandbar during low tide, on any clear day, you will see Labuan main island on one side and Brunei on the other, a lovely spot for a selfie,” she smiles.
Not only has Dr Fary demonstrated her savviness in administering Labuan, she has now converted into its staunch advocate, which bodes well for the island in the long run. Under her watch, Labuan is set reclaim its position as one of the rising pearls of the orient in the digital age that travellers and investors should keep their eyes on…
This article is featured in Gaya Travel Magazine Issue 15.1. Read other contents HERE.