Asia and Pacific > Brunei Darussalam

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International Monetary Fund. Asia and Pacific Dept

1. New COVID-19 waves significantly affected the Brunei economy. The country was hit by the Delta variant in August 2021 and then by the Omicron variant in 2022, with new COVID cases increasing substantially in February 2022. New cases have declined since March, to 535 cases per million people as of end-May 2022 (see Annex 1). The authorities reintroduced partial lockdowns in August 2021, which negatively affected wholesale and retail trade activity in 2021Q3 (-4.3 percent decline y/y). The removal of many restrictions from mid-November and strong progress in vaccination have contributed to stronger activity in the contact-intensive sectors in Q4 (the service sector grew 2.1 percent y/y) and improved business sentiment. Brunei’s Business Sentiment Index remained above 50 (the threshold indicating economic expansion) in April 2022.

International Monetary Fund. Asia and Pacific Dept

IMF Country Report No. 22/302

International Monetary Fund. Asia and Pacific Dept
After successfully weathering the pandemic in 2020, Brunei was hit by new waves of COVID-19, with case numbers going up significantly and new lockdown measures imposed in H2 2021. Reduced activities in mining and LNG manufacturing, combined with the negative impact of new pandemic variants on domestic services, led to a slowdown in the economy. Real GDP contracted by 1.6 percent in 2021. For 2022, growth is projected to rebound to 1.2 percent, on the back of easing of mobility constraints and a positive terms of trade shock due to surges in O&G prices. Inflation, while remaining relatively low at 2.2 percent at end 2021, has increased in 2022 and pressures are expected to remain elevated in the short term, owing to supply disruptions and higher food and fuel prices. The economy continues to diversify, with double-digit growth of the food/agriculture sector and a new fertilizer sector commencing production. The risks to the outlook are tilted to the downside, due to potential new COVID-19 variants, increased global uncertainty associated with an escalation of the war in Ukraine, monetary tightening from the US and a larger-than-expected growth slowdown in China. On the upside, higher energy prices would further improve the terms of trade and restore fiscal positions in the short term, while partially contributing to build the buffers needed to ensure stronger intergenerational equity. Strong policy actions are needed to boost medium-term growth and foster resilience.
International Monetary Fund. Statistics Dept.

An External Sector Statistics (ESS) technical assistance (TA) mission was conducted remotely to Brunei Darussalam, during July 26–29, 2020, aimed at improving the quality of ESS, in line with the authorities’ request. This is the most recent TA mission on ESS to Brunei Darussalam following a previous one that took place more than 16 years ago by the IMF’s Statistics Department.

International Monetary Fund. Statistics Dept.
An External Sector Statistics (ESS) technical assistance (TA) mission was conducted remotely to Brunei Darussalam, during July 26–29, 2020, aimed at improving the quality of ESS, in line with the authorities’ request. This is the most recent TA mission on ESS to Brunei Darussalam following a previous one that took place more than 16 years ago by the IMF’s Statistics Department.
International Monetary Fund. Asia and Pacific Dept

1. The Brunei economy has been buffeted by the COVID-19 pandemic and the associated oil and gas (O&G) price decline. The first confirmed COVID-19 case was reported in the Sultanate on March 9, 2020. The number of cases increased rapidly to 100 cases in just 15 days, with the first COVID-19 fatality reported on March 28, 2020. In addition to the health shock, Brunei had to contend with the pandemic-induced decline in global oil and gas prices, which dropped by 22 percent from 2019 to 2020. Thanks to early and decisive interventions, the authorities succeeded in suppressing the first wave of the outbreak (as of mid-July 2021, there had been no cases of community transmission since May 5, 2020) and rolled out economic relief measures to cushion the economic toll (Appendix I). As a result, the economy performed well in 2020, with real GDP posting 1.1 percent growth—a rare outcome amidst a sea of negative growth in the region.