Who really ‘scores’ in Sarawak’s industrialisation plans?

The Sarawak Corridor of Renewal Energy, or SCORE, stretches from Tanjung Manis in the south to Samalaju in the north of Sarawak.– Map courtesy www.recoda.com.my, July 17, 2014.

Carved out of what was once lush jungle on the north eastern shore of Sarawak, is a town that its politicians claim will transform Malaysia's largest but poorer state’s economy, and place it on par with the country's wealthiest states.

Called Samalaju, the town will have some of the biggest heavy industry factories and smelters Sarawak and the rest of Malaysia in what is the biggest draw so far for investors in the Sarawak Corridor of Renewal Energy (SCORE) – the master plan to industrialise Sarawak.

But the people this grand plan is supposed to help – native villagers miles from it and local businesses around Samalaju – seriously doubt the government’s narrative.

The plan to build hydroelectric dams needed to power the factories of Samalaju and SCORE has already sparked protests and blockades from natives.

A local group claimed that if the Baram dam is built, it will displace about 20,000 people from 32 villages along the Baram River.

Meanwhile local businesses living in Bintulu, about 80 km from Samalaju, say that they are only getting the “small fish” from the lucrative net of contracts to build and supply the plants and its workers.

So as more mega factories and a deep water port come up in Samalaju, the question being asked is, who does it really benefit? 

Patchy benefits

Samalaju is one of five “growth nodes” in SCORE. And part of the SCORE plan is to boost Sarawak’s economy by using its natural resources.

The Baram dam, among hydroelectric dams to power the factories in SCORE, has sparked protests and blockades from natives. – The Malaysian Insider file pic, July 17, 2014.In the case of Samalaju, this “natural resource” refers to the huge rivers in Sarawak’s hinterland that get flooded for hydroelectric dams.

The electricity from these dams is lure for energy-hungry heavy industries such as those processing aluminium, steel and glass to set up shop in Samalaju, which was started in 2012.

According to the SCORE website recoda.com.my, five plants are already up and running in Samalaju.

A June 2013 report in The Star said that Samalaju has thus far attracted RM25 billion in investments.

There are two silicone manganese factories, an aluminium smelter, a polycrystalline silicon factory and one producing metallic silicone.

The Sarawak government has boasted that Samalaju will create opportunities for local businesses, jobs for locals and eventually raise living standards.

“As more energy intensive industries establish themselves in SCORE, they will form the bedrock of the SCORE strategy, giving a robust boost to the development of the growth nodes.

“Which (will) in turn, require training centres and technical colleges to train the population and create a core of skilled workers thereby raising the living standards of the population,” says a posting on the SCORE website.

But interviews with locals in Bintulu reveal that the positive effects of Samalaju on Bintulu businesses are patchy.

Some, like budget hotels, food suppliers and restaurants are seeing a modest boost in their business, while others such as construction and equipment suppliers complained of being left out.

The owner of a hotel called the Reggae Inn, said his occupancy rate has picked up slightly ever since Samalaju started two years ago.

“Hotels are roaring now. It’s been good business,” said the owner, who declined to be named when met at the new Parkcity commercial centre.

Allen Thiew, who manages a seafood restaurant in Medan Jaya said many of the Japanese, Korean and Chinese senior management who work in Samalaju have frequented his eatery.

“Foreigners make up 30% of the customers at the restaurants in Bintulu. Local managers need a place to entertain their foreign bosses,” said Thiew.

Downstream disappointment

But the promise of more jobs for locals and business opportunities from Samalaju has yet to come true.

Contractors in Bintulu said the companies in Samalaju have brought in all of the semi-skilled and skilled workers needed for their plants from outside of Sarawak.

There are an estimated 8,000 workers consisting Malaysians from the peninsula, Indonesians, nationals from India and China, Nepalese, Filipinos and Pakistanis in Samalaju.

It is learnt that more than 80% of these workers stay in two camps inside the industrial estate and almost never venture out into Bintulu.

A local who had won one of the tenders to provide workers for Samalaju claimed that the majority of the semi-skilled workers are foreigners.

And a majority of the Malaysians are from the peninsula.

“Malaysians demand higher wages than foreigners. A Malaysian will cost RM30 an hour, but a foreigner will only cost RM15 an hour,” said the businessman, requesting anonymity.

Another entrepreneur who has done business with companies in Samalaju said that even when the plants were being built, the contractors preferred Indonesian labourers over Sarawakians.

“There are Sarawakians working in Samalaju but their numbers are small compared with the peninsula guys and the foreigners,” said the entrepreneur who declined to be named.   

What has really rankled Bintulu’s construction community is the fact that all the main contractors in Samalaju were from the peninsula.

One local contractor estimated that from the total amount of contracts that had been awarded so far, locals only managed to get 10% to 15%.

“If local contractors got any work it is only sub-contracts. The margins are low. The main contractor got all the big profits and they were all outsiders.”

A small equipment and hardware supplier also said it was different with the Malaysian liquefied natural gas terminal in Kidurong.

As the plant expanded over the years from 1978, local suppliers like him got business supplying material for the contractors who worked there.

“But with Samalaju, everything was shipped there from the peninsula or wherever, workers, parts and equipment.”

Sarawak lawmaker Chiew Chiu Sing said in reality, Samalaju was a boon for big industries and Malaysian companies with high connections.

Support industries such as those building and operating the workers camp in Samalaju and those constructing the roads there have all been cornered by companies close to Sarawak politicians, he said. 

“We are providing so much amenities to these foreign companies — roads, land, workers' camp, housing, new water treatment plant and cheap electricity,” said the Kidurong assemblyman.

“What do we get in return? Almost nothing.”

- TMI