Phoong: Sabah must strengthen food security, push for manufacturing growth
Phoong (third from left) during the official opening ceremony of SIFEX.
KOTA KINABALU (April 26): Sabah must act swiftly to strengthen its food security and transform itself into a producing and manufacturing state amid rising global uncertainties, said Minister of Industrial Development and Entrepreneurship, Datuk Phoong Jin Zhe.
He warned that ongoing global trade wars and tariff disputes are likely to disrupt supply chains and drive up prices, putting import-reliant states like Sabah at significant risk.
'We are living in an uncertain world. If the tariff wars continue, we will face lower global demand and unavoidable price inflation,' Phoong said, noting that Sabah imports almost everything, making it highly vulnerable.
He stressed the need for local entrepreneurs to seize new opportunities by moving beyond reliance on raw materials and tourism.
'Agriculture and tourism will remain important, but we must go further. We must produce something. We must move downstream and make Sabah a producing and manufacturing state,' he said after officiating the Sabah International Food Expo 2025 (SIFEX) on Saturday.
Phoong said his ministry is prioritising the manufacturing sector, aggressively attracting global investments while upskilling local industries. He cited successful investments by Kibing, SK Nexilis, and the upcoming Esteel project as signs of Sabah's growing industrial potential.
At the same time, support for local entrepreneurs is being strengthened to help modernise businesses and expand market reach.
'Even if you are selling ikan bilis at the tamu, it's no longer enough to sell it the traditional way. We must improve packaging, branding, and production to access not just the local market, but the wider Borneo region and beyond,' he said.
Phoong highlighted that Sabah recorded the highest manufacturing sector growth among Malaysian states in 2023 at 4.4 per cent and expressed confidence that the positive momentum would continue.
However, he pointed out that Sabah's small domestic market of 3.7 million people cannot sustain major industries, making export development crucial.
To support this, the ministry has strengthened its Small and Medium Enterprise Readiness (SMER) programme, assisting local industries with modern machinery, packaging, branding, and access to export markets.
'Now, when we give machines, it's not just a giveaway. We monitor closely, set KPIs, and support businesses with strong marketing plans committed to growth,' Phoong said.
He added that the previous policy of allowing entrepreneurs to apply for only one machine in their lifetime has been abolished.
'If your business grows, you can apply every year for different equipment because scaling up must be continuous,' he said.
The ministry is also collaborating with private sector organisations and NGOs to offer training in areas such as branding, AI applications, and digital marketing.
'In today's fast-changing world, skills must evolve. We are working with partners like MITI to ensure our entrepreneurs are prepared,' Phoong said.
While Sabah's direct exports to the United States account for just 0.6 per cent of total exports, he warned that ripple effects from global trade disruptions could still impact the state.
'Sabah must be ready. If we do not produce anything and disruptions happen, we will face the same problems we saw during Covid-19 when food prices skyrocketed,' he cautioned.
Ultimately, Phoong said diversifying into manufacturing is critical not only for economic growth but also for Sabah's resilience.
'We cannot just rely on the primary sector anymore. It is time to build a more competitive, reliable and sustainable economy for Sabah,' he said.
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