By Admin 
The Covid pandemic dealt a huge blow to the economy of almost every country. Governments had to increase spending, take out loans, and budgets in many countries faltered, but during these turbulent years, a small country named Brunei seemed absolutely safe. While the world was struggling with increasing debt, Brunei’s government debt to GDP remained only about 1.9%, which is considered to be the lowest in the world.
The population of this country situated in South-East Asia is about 5 lakhs, but the facilities are no less than any developed nation. No income tax is taken from the citizens here. From education to treatment, everything is available free. The government also provides land and houses to needy families. This is why the Sultan of Brunei is counted among the list of the richest rulers in the world. The capital Bandar Seri Bagawan is among the safest cities in the world due to its clean and peaceful lifestyle.
Oil and gas the economic backbone of Brunei
According to Professor Ulrich Walz of the London School of Oriental and African Studies, Brunei is a “petro-state”, with about 90% of its economy powered by oil and natural gas. By 2017, the oil reserves here were above one billion barrels, while the gas reserves were estimated at more than 2.6 trillion cubic meters. Such a large amount of energy resources provides economic security to a small country.
Why does the government not need loans?
The earnings from oil and gas are so high that Brunei does not need to borrow externally. The country’s current account often remains in surplus and foreign exchange reserves remain strong. Even if there is a deficit, the government compensates it from its cash capital, that is why Brunei is often called a loan giving country, not a borrowing country.
The impact of global recession is also minimal
The economy of most countries slowed down during the pandemic. Big holes were created in the budget and foreign debt increased. In contrast, Brunei remained almost unaffected. The reason is simple, its entire system is based on income from energy, which continuously maintains its financial condition. Moody’s analysts also say that Brunei’s financial policies and government management reduce its burden.
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