SANDAKAN: The Industrial Development and Entrepreneurship Ministry (MIDE) will continue collaborating with investors and relevant agencies to attract more investments into Sandakan, benefitting both the local economy and people of the region.
“Sandakan has great potential for biomass
industries to flourish, and I will continue working to ensure that Sabah’s biomass sector has the tools and resources needed to thrive,” said the Minister Datuk Phoong Jin Zhe.
He said this during his recent visit to Sandakan Bricks Sdn Bhd, as part of his ongoing initiative to visit 50 local factories to better understand the challenges faced by Sabahan manufacturers and explore potential solutions for sustainable industrial growth.
During the visit, Phoong was briefed on the company’s operations, particularly their use of Palm Kernel Shell (PKS), sourced from local mills at a significantly reduced price, thanks to the State Government’s newly implemented biomass policy.
Sandakan Bricks Sdn Bhd currently produces around 3 million bricks per month, with 50 per cent of its production exported to Brunei.
PKS plays a crucial role in brick manufacturing by generating the high temperature heat necessary for production—temperatures higher than those achievable by other biomass materials, such as wood.
Datuk Anthony Lau, owner of Sandakan Bricks Sdn Bhd, expressed his appreciation for the State Government’s efforts in making PKS more accessible to local manufacturers.
“Before the policy was introduced, my partner and I were seriously considering halting the brick factory’s operations due to the high cost of PKS. However, thanks to the reduced costs resulting from the implementation of the biomass policy, we are not only able to continue operations but are now considering expanding by building a charcoal factory. This expansion could create an additional 20 to 30 jobs here in Sandakan,” said Lau.
The State Government’s biomass policy sets a 7.5pc State Sales Tax on raw biomass material, including PKS, when exported out of Sabah.
This encourages local mills to retain PKS within the state, reducing the price of PKS for local consumption by up to 40pc.
This cost reduction enables local manufacturers to scale their operations, improve competitiveness and grow sustainably.
Earlier this year, Next Green Global Berhad signed an MOU with Sawit Kinabalu to invest in and establish a Green Technology Park (GTP) in Sandakan.
This investment, driven by the biomass policy, will use palm oil biomass, such as empty fruit bunches (EFB), to produce green products like pulp and paper, creating more job opportunities and business prospects in the region.
“I am pleased to see that the biomass policy has not only attracted investment into Sandakan but has also positively impacted our local manufacturers,” said Phoong.
