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Sabah Economic Growth INAUGURAL LECTURE INAUGURAL LECTURE Kasim Bin Mansor @ Md. Mansur Delivered as Universiti Malaysia Sabah Professorial Inaugural Lecture on 12 March 2021 via live streaming on Universiti Malaysia Sabah Facebook and YouTube Channel PENERBIT UNIVERSITI MALAYSIA SABAH Kota Kinabalu • Sabah • Malaysia http://www.ums.edu.my 2021 A Member of the Malaysian Scholarly Publishing Council (MAPIM) © Universiti Malaysia Sabah, 2020, 2021 All rights reserved. No part of this publication may be reproduced, distributed, stored in a database or retrieval system, or transmitted, in any form or by any means, electronic, mechanical, graphic, recording or otherwise, without the prior written permission of Penerbit Universiti Malaysia, except as permitted by Act 332, Malaysian Copyright Act of 1987. Permission of rights is subjected to royalty or honorarium payment. Penerbit Universiti Malaysia Sabah makes no representation – express or implied, with regard to the accuracy of the information contained in this book. Users of the information in this book need to verify it on their own before utilising such information. Views expressed in this publication are those of the author(s) and do not necessarily reflect the opinion or policy of Universiti Malaysia Sabah. Penerbit Universiti Malaysia Sabah shall not be responsible or liable for any special, consequential, or exemplary problems or damages resulting in whole or part, from the reader’s use of, or reliance upon, the contents of this book. Perpustakaan Negara Malaysia Cataloguing-in-Publication Data Kasim Mansur, 1961- Labour, Human Capital and Economic Development in Sabah / Kasim Mansur. (INAUGURAL LECTURE) Mode of access: Internet eISBN 978-967-2166-89-4 1. Labor--Malaysia--Sabah. 2. Human capital--Malaysia--Sabah. 3. Economic development--Malaysia--Sabah. 4. Government publications--Malaysia. I. Title. II. Series. 331.0959521 Typeface for text: Calibri Text type and leading size: 11/13.2 points Cover and layout designer: Nataniel Ebin Proofreader: Marshell Kanam Gombor Editor: Lindsy Lorraine Majawat Published by: Penerbit Universiti Malaysia Sabah Tingkat Bawah, Perpustakaan Universiti Malaysia Sabah Jalan UMS, 88400 Kota Kinabalu, Sabah Kasim Bin Mansor @ Md. Mansur Faculty of Business, Economics and Accountancy Universiti Malaysia Sabah Contents ACKNOWLEDGEMENTS vi SYNOPSIS viii SINOPSIS ix LIST OF ABBREVIATIONS x INTRODUCTION 1 MODELS OF ECONOMIC GROWTH 2 Investment in Human Capital SABAH ECONOMIC GROWTH 12 Sabah at a Glance Sabah Population Sabah’s Socio-economy and Demography LABOUR MARKET IN SABAH 26 Sabah Employment Trends and Facts Labour Productivity and Wages HUMAN CAPITAL AND EDUCATION 34 Level of Education among Selected Ethnics in Sabah and Their Roles towards Development CHALLENGES IN SABAH’S ECONOMIC DEVELOPMENT 42 POLICY AND ACTION PLAN IN SABAH ECONOMIC DEVELOPMENT 48 Sabah Development Corridor (SDC) National Key Economic Area (NKEA) Zakat for Poverty Eradication RECOMMENDATION AND CONCLUSION 57 BIBLIOGRAPHY 62 BIODATA 76 ACKNOWLEDGEMENTS n the name of Allah, the Most Gracious, the Most Merciful. All praises belong to Allah and His blessings for the completion of Ithis book. I thank Allah for all the strength and opportunities that have been showered on me to finish writing this book for my inaugural lecture. Selawat and salam upon the beloved Prophet Mohammad (SAW) peace and blessings be upon him whose way of life has been continuous guidance for me and the ummah. Very special gratitude goes out to all my fellow faculty members and Economic Research Group (ERG) for helping and providing excellent assistance to publish this book. Special thanks go to Dr Beatrice Lim Fui Yee, Dr Hajah Khairul Hanim Pazim, Puan Dayangku Aslinah Abd. Rahim, Puan Roslinah Mahmud, and Dr Siti Hajar Samsu for their commitment and sacrifices for the sleepless nights to prepare this book. I am also most grateful to them for their comments on an earlier version of the manuscript, although any errors are entirely my own. It has been fantastic to have the opportunity to work with most of my research team in the faculty. I thank them wholeheartedly. I am also grateful to all the previous Deans of the Faculty/School and all Deputy Deans for their unfailing support and assistance to get funding for research grants and other related academic engagements. To all dedicated non-academic staff in the Faculty of Business, Economics and Accountancy and the Department of Registrar of UMS, thank you so much, your commitment is simply superb! Without your precious support at the administration office, it would not be possible to reach this level. I would also like to express my gratitude to all UMS Vice Chancellors namely Professor Emeritus Tan Sri Dr Abu Hassan Othman, Professor Emeritus Datuk Dr Mohd Noh Dalimin, Professor Datuk Seri Panglima Dr Kamaruzaman Hj Ampon, Professor Datuk Dr Mohd Harun Abdullah, Professor Datuk Dr D. Kamarudin D. Mudin and the current Vice Chancellor Professor Datuk Dr ChM Taufiq Yap Yun Hin. They have shared their pearls of wisdom with me during my tenure at the university. It has been a great pleasure vi and honour to have full support from all. I wish to express my sincere thanks to three “anonymous” reviewers of this book for their insights, expertise and valuable comments and suggestions. To all my colleagues at UMS, IDS, SEDIA and UPEN, you have indirectly assisted this writing, although some of you may not agree with all the interpretations or conclusions of this book. To my late father Haji Mansor Awang Matasan and my late mother Hajah Fatimah Maseh, I owe it to both of you and my special do’a will forever be for you both. During my teenage years, I remember you were always keen to know what I was doing and how I proceeded in my endeavour and quest for knowledge. May Allah shower your souls with rahmah and maghfirah, Aamiin. I am also grateful to all my siblings who have provided me with moral and emotional support in this journey and my extended family members and friends far and near whom have supported me along the way. Last but not least, I would like to thank my beloved wife, Aidah, and my children, Fatimah, Mezi, Hisyam, Fehan and Hanis, for your understanding, patience and support, both morally and spiritually throughout my university tenure. May Allah SWT shower the above-cited personalities with success and honour in this worldly life and life in the hereafter. Thank you for all your encouragement! vii SYNOPSIS his book highlights some contemporary issues related to Sabah’s economic growth, including socio-economic, labour Tand human capital. These issues are linked to relevant economic and growth theory approaches. Critical issues on the challenges in the development and the way forward to realise government policies such as the Sabah Development Corridor (SDC), the National Key Economic Area (NKEA) and the implementation of zakat to eradicate poverty will also be discussed. Economic development for Sabah is essential and is an ongoing effort to ensure that Sabah can compete in a gradually competitive economy. Implementing sound economic policies is vital in improving the social well-being and standard of living in the state. This book also explores socio- economic issues involving various ethnic groups in Sabah, especially improving human capital and infrastructure investment. The author identified that these elements are the key contributors and enablers to Sabah’s economic growth. Thus, economic growth and development are consistent agendas to ensure future generations can live comfortably in a conducive economic environment. Hence, this book re-emphasises the importance of knowledge workers in preparing the Industrial Revolution 4.0. The author also recommends that Sabah’s further economic development be attained through rigorous efforts from strong cooperation of state and federal government and firms, private sectors, industries, non-governmental organisations (NGOs) and the people. The development can be realised through investment and innovation. This book is significant to academics, students, policymakers, and community in increasing awareness of the importance of labour, human capital and economic development in Sabah. While adding to existing literature, this book can also be an additional reference about Sabah’s key economic characteristics and labour market. viii SINOPSIS uku ini mengetengahkan beberapa isu kontemporari yang berkaitan dengan pertumbuhan ekonomi Sabah termasuk Bsosio-ekonomi, tenaga kerja dan modal insan. Isu-isu ini berkaitan dengan pendekatan teori ekonomi dan pertumbuhan. Selain itu, buku ini mengupas isu-isu kritikal bagi cabaran dalam pembangunan dan hala tuju untuk merealisasikan dasar kerajaan seperti Koridor Pembangunan Sabah (SDC), Bidang Ekonomi Keutamaan Negara (NKEA) dan implementasi zakat untuk mengurangkan kemiskinan. Sehubungan dengan itu, pembangunan ekonomi Sabah adalah penting dan merupakan usaha berterusan demi memastikan Sabah boleh bersaing di ekonomi yang semakin kompetitif. Pelaksanaan dasar ekonomi juga penting untuk memperbaiki kesejahteraan sosial dan taraf hidup masyarakat terutamanya di Sabah. Buku ini juga meneroka isu sosioekonomi merangkumi kepelbagaian etnik di Sabah terutamanya dalam menambahbaikan pelaburan modal manusia dan infrastruktur. Penulis mengenalpasti bahawa elemen ini adalah penyumbang dan penggerak utama untuk pertumbuhan ekonomi Sabah. Oleh itu, pertumbuhan dan pembangunan ekonomi merupakan agenda yang berterusan untuk memastikan generasi masa hadapan boleh hidup selesa dalam suasana ekonomi
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