our wallets still feel empty
Sarawak is getting richer.
So why do our wallets still feel empty?
record revenue (2025)
from Petroleum SST alone
of household income vs national avg gap
Sarawak is on track for a record RM12.1 billion in revenue. On paper, we are a powerhouse. But ask the average family in Kuching, Sibu, or Miri if they feel that wealth, and the answer is often silence. Why does this gap exist? And more importantly, will our children stop migrating to West Malaysia and Singapore in the next decade?
Let's break down the hard truth. At the same time, the state is pushing an aggressive AI & data centre agenda by 2030 — a high-tech leap. But without fixing this structural leakage, the digital economy might only deepen the divide. Two futures are colliding: a gleaming data centre park and a silent kitchen table.
šØ The Three Structural Problems No One Is Talking About
1. The Revenue Mirage (Where does the money actually go?)
That RM12.1 billion is overwhelmingly driven by Petroleum SST (RM3.9 billion) and dividends from state-owned giants like Petros, SEB, and CMS. Households see almost none of it directly. It flows into state coffers, then into big infrastructure projects — often awarded to connected companies. The result: a glossy macro number, but zero wealth felt at the kopitiam level.
2. The "Government & Company" Loop
State-owned firms win the major contracts (roads, bridges, ports). They hire contract workers — often from outside Sarawak. Profits flow upward to shareholders, not outward into local household spending power. The multiplier effect is weak, and the local economy becomes a spectator.
3. The Agriculture & SME Trap
Yes, "high economy crops" are still low. Land is being consolidated into big plantations. Logistics: Smallholders can't access the new deep-sea port. Result: We are building a port for bulk commodities, not for our own farmers. AI might optimise port logistics, but if local farmers can't use it, the algorithm serves outsiders.
š The 5–10 Year Outlook (If Nothing Changes)
| Factor | What Happens Next? |
|---|---|
| Wages | Stagnant. Unless there is a severe labour shortage, don't expect a raise. |
| Labour Migration | Continues. Why stay for minimum wage when Singapore pays a premium? |
| Business Ownership | Bigger players will capture the new port and agro-processing. SMEs lose. |
| Household Income | Trails state revenue growth. The gap widens, not closes. |
⚠️ The "Dutch Disease" Warning
Economists call it Dutch Disease — when a resource-rich economy sees revenue flood in, but everything else breaks. Construction costs and land prices skyrocket. Tourism, manufacturing, and high-value farming cannot compete for labour or capital. Ordinary households outside government or GLCs get left behind. Sound familiar? It should. We are living it.
š§ The Hard Question: Is there a path for households?
Brutally honest answer: Not under the current model. To fix this, we need three things that aren't happening at scale yet:
- Local Hiring Laws: Mandatory wage floors for GLC contracts. Stop hiring cheap outside labour.
- Break the Monopolies: Smallholders need access to export licenses and the new port.
- Direct Support: Shift from just building bridges to direct household income support (co-investing in small businesses, wage subsidies).
š¤ Where does AI & Data Centre fit into this? A reality check
From our previous deep dive: Sarawak is structurally ready for AI by 2030 — government vision, energy, land. But here is the clash: if AI adoption only benefits foreign cloud providers and a handful of local elites, the Dutch Disease deepens. Without a mindset shift in business ownership and labour integration, data centres will create enclave wealth (high-tech silos with few local jobs). The same households left behind by the oil boom will be left behind by the algorithm boom. The only sustainable path is to pair AI infrastructure with mandatory local value capture: SME upskilling, public data accessibility, and wage-linked incentives. Otherwise, 2030 arrives with a smarter port and the same empty wallets.
The uncomfortable synthesis: Sarawak can be both an AI hub AND suffer household stagnation — unless the revenue model is redesigned today.
Balancing AI Ambition & Household Reality: A Roadmap
We cannot pause AI — but we can redesign the distribution model. Based on the preceding analysis, here is a pragmatic 3-step framework to ensure the data centre economy doesn't replicate the oil curse:
Mandate that data centre construction and AI operations hire at least 70% Sarawakian workforce at above-market wages. Similar to oil & gas local participation rules.
Use a portion of the RM12.1 billion to subsidise AI adoption for smallholders, logistics cooperatives, and rural clinics — not just mega projects.
Channel recurring dividends from Petros and SEB into a "Sarawak Progress Share" — direct cash or co-investment for lower-income families.