Welcome to my private journal generally on Brunei issues. Any opinions expressed are in my personal capacity. All rights to the articles are reserved.

Sunday, September 21, 2008

Claims in Jersey

[Note: This article written by Ben Quérée was published in the Jersey Evening Post on 20th September 2008]

ATTEMPTS to reclaim billions of dollars worth of assets allegedly stolen by the younger brother of the Sultan of Brunei have reached Jersey’s Royal Court.

The case involves the Sultan – one of the world’s wealthiest men – and his younger brother Prince Jefri who used to be the oil-rich country’s Minister of Finance.

The Prince has been ordered by the court to hand over shares in Karinska Ltd held by Fidelis Nominees Ltd and Rostand Nominees Ltd, and shares in Greencap Ltd held by Premier Circle Ltd, Second Circle Ltd and Third Circle Ltd.

Prince Jefri was accused in February 2000 of ‘misappropriation and misapplication’ of more than $15 bn worth of state assets.

But he agreed a deal in May that year to return the assets in return for immunity from any criminal or civil action.

However, although some assets were returned over the following year – and some valuable diamonds were handed over in 2007 – there are still many billions worth of assets outstanding.

Monday, September 15, 2008

BIA's Hotel Expansion

Note: Dominic Walsh in the UK Times (15th September 2008) wrote this article.

After years of talking about expanding its luxury hotel business, the Brunei Investment Agency (BIA) is finally investing. Having recently added the Hotel Bel-Air in Los Angeles and the New York Palace in Manhattan to its exclusive chain, it is preparing to invest almost £100 million converting two more landmark properties in Britain into hotels for the rich and famous.

Christopher Cowdray, the man charged with overseeing the BIA's hotel expansion plan, is casting his eye over trophy hotels throughout Europe and North America with a view to persuading their owners to sell to the BIA or hand over control under a long-term management contract.

Last November, Mr Cowdray, a former managing director of Claridge's, was named chief executive of the Dorchester Collection, the BIA's hotel management business, with a brief to expand from five hotels to fifteen by 2015. “There's an enormous opportunity to grow the Collection,” he said.

Management contracts are a departure for the group, which until now has run properties owned by the BIA, itself ultimately controlled by the Sultan of Brunei. The Bel-Air and New York Palace were both seized by the BIA from Prince Jefri Bolkiah, the Sultan's brother, after a legal battle over state-owned assets.

As well as planning a $200 million (£112 million) revamp of the New York Palace, Mr Cowdray is starting plans to convert two Brunei-owned properties in London and Berkshire into the next part of the Dorchester Collection. The first, due to open in 2010, is the former Playboy Club, next door to The Dorchester itself — but forget the Bunny Girls. The 50-room hotel envisaged under the proposed £40 million refit will create a sophisticated look a million miles from the casino that was closed down in 1982 over suspected gaming irregularities.

Mr Cowdray said that although the hotel, to be called 45 Park Lane, would be run as an adjunct to the Dorchester, it would have a more contemporary feel. “The price-point will be very similar — at the top end — but it will have its own personality. It will be modern rather than traditional and will appeal to a different audience.”

The other project occupying the Zimbabwe-born hotelier's time is Coworth Park, a stately home and 200-acre estate near Ascot acquired by the Sultan a few years ago. Subject to all necessary planning consents, the Georgian house will provide 35 bedrooms and suites and a further 35 rooms will be created from the stables and various cottages.

The Coworth polo centre will become an equestrian complex and polo will still be played. “Most hotels of this sort have golf, but with Wentworth near by there's no point developing a golf course. I want to keep the polo aspect to it because polo tournaments are great fun. It's becoming very popular and brings a unique aspect.”Despite the Dorchester Collection's royal connections, Mr Cowdray rejects any suggestion that it is merely a rich man's plaything. “The hotels all make a good return. You have targets and measurements and staff respond to those. When businesses become very soft and fluid, they lose direction and when you get economic downturns they are not able to respond.”

Despite the economic climate, Mr Cowdray claims that the company has been unaffected so far, with earnings in the first half up 15 per cent at £35.5 million. “We don't seem to have been affected by recession,” he said. “The difference is that the market we deal in is a bit more resilient. It's also shifted, so while the UK and US economies are a bit down, we've got economies such as Russia, the Middle East, China and the Far East that are up.”

The nature of the company's clientele — guests at the Dorchester include Nelson Mandela, Nicole Kidman, the Hollywood actress, and numerous heads of state — mean that even a full recession is likely to have a relatively limited impact as the super-rich and super-famous continue to seek out the most exclusive hotels in the world.

Sunday, June 22, 2008

The Ambuyat - not the Mat Salleh's Sweet Sago Pudding

[Note: I found this article on our national food 'Ambuyat' written for Denver Post by John Henderson and syndicated on the The Times of Zambia (of all place!)]

If Bruneians want to expand tourism, they’ll need to hide their national speciality.

I saw the sultan of Brunei the other day. He walked right by me as he entered a national Qur’an reading contest.

I wanted to ask the sultan a key question about his country’s cuisine: Hey, sultan, why can’t a man worth 22-billion, whose 400-million palace has a 110-car garage and 257 bathrooms, afford a better national dish?

It’s called ambuyat. Don’t look for it at an ethnic restaurant near you soon. It’s not going anywhere, and it’s here for reasons only historians and the streets’ starving cats can appreciate.

After four days in Brunei, I’d describe ambuyat (pronounced om-BOO-yacht) as a big pile of gelatinous, transparent goo dipped in coagulating blood.

First, a little background. During World War II occupation, the Japanese controlled Brunei’s rice paddies and cut off the food supply. One of the lone food sources was found inside the sago trees that fill Brunei’s jungles.

For centuries the Penan people, an indigenous, nomadic tribe who roam the jungles of Borneo, have lived off the sago tree. They still do. During a three-day trek through the jungles of Malaysian Borneo, I came across a Penan family squatting next to a stack of sago pulp.

They put what looked like leafy sawdust in a wooden bowl the size of a rubbish bin and pounded it into small chunks. They then mix it with hot water and the result is a starchy mass that has all the daily nutrients of raw lard.

Brunei, however, has advanced a bit since World War II. With the discovery of oil in 1929, Shell and the beloved sultan have put petrol in every pot. Shaped like two humps on a camel and occupying a small corner of Borneo’s northwest coast, Brunei has gone from a backwater British protectorate to a thriving Islamic republic of 375000 people with a glittering capital and prosperous economy.

Don’t believe me? What’d you pay for petrol this week? Exactly.

The sultan wants to expand tourism, and while he won’t open Hard Rock Brunei any time soon, he is promoting his country’s history. Part of that history is ambuyat. Tourism has grown 7% a year. I’m assuming ambuyat has nothing to do with it.

To try ambuyat, I went to a food-court stall where it was not pictured among the 31 dishes on the menu. No wonder. A picture in focus would scare off wharf rats.

Two young female cooks invited me into the kitchen to watch the process. It was little different from how the Penans make it. Ema poured a bag of sago that looked like blue-cheese crumbles into a pot of boiling water. She stirred for 60 seconds.

She handed me the result and the necessary dipping sauce, binjai, a gross mixture of chillies, salt and what looked like last week’s tomato soup. Hunks of bulbous matter floated in an orange- brown sea of repugnant fluids.

I was handed chopsticks , around which I was to twist the gooey ambuyat and then dip into the sauce.

The slimy mess slid down my throat like crushed, larvae-coated insect embryos. The sour binjai made my face wrinkle as if I woke up in a dairy farm. I looked over, and a young woman in a head scarf couldn’t stop laughing.

I tried it without the sauce and the ambuyat had no taste. None. But without the lubricating sauce, it nearly stuck halfway down my throat.

So hats off to Brunei for surviving World War II, where ambuyat was probably a tougher obstacle than the Japanese. But if the sultan invites you to the palace, forget the five swimming pools and 564 chandeliers. If ambuyat is on his menu, don’t go.

Friday, June 20, 2008

Brunei on the Bounding Main

[Note: The following was reported on Asia Sentinel written by John Berthelsen, 19th June 2008.]

The oil-rich sultanate is trying to sell 3 modern warships its navy can’t use .

Want to buy a high-speed warship, cheap, never used, bristling with some of the most advanced weaponry on the high seas? Three of them, in fact? Call Brunei. They can’t use them.

Ever since the sultanate settled a confidential contract dispute over the vessels in the International Court of Arbitration in June 2006, its navy has been trying to get rid of three 95-meter-long corvettes, built by BAE Systems of the UK. Since July 2007, they have been parked in Walney Channel near BAE’s shipyard at Barrow-in-Furness in northwest England while Brunei seeks a buyer. The price for the three is ₤600 million (US$1.71 billion).

They are now in the hands of the German luxury yacht builder Fr. Lürssen Werft GmbH & Co. KG, which has been looking for a buyer for more than a year, rather than a military broker. A Lürssen Werft spokesman, asked about the three ships, said he would inquire and get back to Asia Sentinel, but so far hasn’t done it. One source said the three ships are being offered to the United Arab Republic, possibly through sources in Singapore. Malaysia also is believed to have looked at them briefly.

“They have been taken away by the customer,” said a spokeswoman for BAE. “As I understand it, they are somewhere in the northwest, but they are not with BAE Systems. As far as the business is concerned, the customer took delivery. They are no longer moored with us.” She would not comment further.

The story began in 1995 when Brunei, which has only 66 miles of coastline, went looking for advanced protection for its 313,000 citizens, its oil reserves and its fabulously wealthy royal family. Brunei declines comment on its military affairs. But one source with connections to the Brunei government said that Sultan Hassanal Bolkiah is believed to have been swayed by a desire to project Bruneian naval power in an effort to hold the country’s portion of the much-disputed Spratly islands.

The Spratlys are a string of 51 small islands and reefs, 44 of which are claimed or occupied by every country contiguous to the South China Sea including China, the Philippines, Vietnam, Taiwan, Malaysia and Brunei, in a bid for fishing and energy rights. Brunei only recently became an active player in the Spratly dispute by claiming the Louisa Reef adjacent to its coastline in an apparent attempt to forestall any claims on its coast or its nine oil fields in the South China Sea, which average about 143,000 barrels per day.

Already protecting Brunei’s coast, according to some reports, are the Royal Brunei Navy’s three guided-missile patrol craft armed with MBDA Exocet antiship missiles, three smaller patrol boats, two amphibious craft, two landing craft, 17 small armed river boats used by the Special Combat Squadron, a support launch and 23 Marine police patrol boats.

The armaments aboard the three corvettes appear to be sophisticated enough to chase some of the other countries off whichever Spratly Brunei might decide it wants, let alone hold off any attackers likely to show up in Bruneian waters, situated as they are on the north coast of Borneo on the South China Sea. Aboard each of the three are these systems:

- NAUTIS II command and weapon control system;
- MBDA VL Seawolf point defence missile system
- Oto Melara 76/62 Super Rapid gun
- MBDA MM40 Block 2 Exocet anti-ship missiles
- two MSI-Defence single 30 mm REMSIG gun mountings
- two sets of triple torpedo tubes
- BAE Systems Insyte AWS-9 surveillance and target indication radar
- Ultra Electronics System 2500 electro-optical tracking system
- Thales Cutlass 242 electronic support measures outfit and Scorpion jammer
- Thales TMS 4130C1 hull-mounted medium-frequency sonar.

The Royal Brunei Navy’s current strength is about 750 personnel. Each of the three corvettes would require a crew of about 100 personnel and normal naval practice is to train at least two full crews per warship. The new ships would have required at least another 600 men for even the most basic operations, not to mention shore-based support personnel, according to a military analyst based in the UK, effectively requiring almost the doubling of the country’s navy.

“Operating and maintaining this kit would absorb much of Brunei’s small cadre of technically proficient workers, few of whom would be remotely interested in bobbing around the South China Sea being shouted at by people considerably less competent than themselves,” the analyst said.

Brunei refused to accept the ships in 2004, saying they were not up to specification, and attempted to return them to BAE systems. They were forced to take them in the wake of the court case.

But, said the military analyst: “Recognition (that the ships were too complex) came slowly to the sultan and his people, and when it did they first sought a face-saving deal – perhaps calculating that they could arbitrage the three patrol vessels against a possible order for jet aircraft also built by BAE. This clearly did not work and the issue went to law – with the outcome described above.”

Brunei, with its vast oil wealth, has always gone first cabin for military equipment, partly because of the sultan’s personal proclivities. A trip to the Singapore Air Show or other military hardware fairs by the sultan can turn into a show itself as various gun-runners, quick-change artists, armaments dealers and military attaches from countries trying to sell the sultanate hardware cluster around him like bees to extremely lucrative honey.

The sultan himself, educated at the British Royal Military Academy at Sandhurst, pilots his own helicopter. His air force consists mainly of helicopters -- six Sikorsky Blackhawks, five Bell JetRangers, 10 Bell Twin Hueys, six German MBB Bo 105 utility helicopters and a flock of other gear. Plans for fighter capability through the purchase of BAE Hawks apparently are off, presumably after the attempt to trade them for the corvettes fell apart.

The three ships may be hard to sell. According to a July 5, 2007 story in the Times of London, they were designed with doors and beds constructed for smaller, Asia-size sailors. Because they were designed for duty in the warm waters of the South China Sea, they also lack heating. Strategic considerations could also limit their sale. Given their state-of the art missile guidance and target-tracking systems, Exocet mountings and other hardware, the western alliance would frown if buyers from, say, North Korea, Burma or Iran were to express an interest.

Sunday, April 20, 2008

Housing Woes

Sometimes I feel like kicking and knocking some heads together. Just because you are old, you think you are wise. The other day when we did the rounds after handing the keys, you would think these 'old' people would be grateful to the government. No siree...

Each of those recipients received a house for $41,000. It's a terrace house because Brunei, believe it or not is running out of land. So the land is around 0.12 instead of the old 0.25 acres which the government gave out in Lambak Kanan in 1980s or even the 2 acres that was given out in the 1950s to Bunut. Nevertheless those recipents do not have to pay for all the infrastructure - the water, the electricity, the roads, the sewerage, the road lighting etc which if divided equally would cost each of those recipients about $100,000 each. So the house that those people get is worth $140,000. But they only have to pay the cost of the house and nothing else. And they get 30 years to pay for it which if you work it out is worth almost nothing.

What are the things they complain about? These are real answers. The house is too small. I am retiring next year, who will pay for my house. The government does not provide us with a flagpole or a flag. The government does not cut the grass in front of my house often enough. The government does not clean my longkang. The government does not ...

What do our people want? For the government to spoon feed them? The government has taken care of building the house, take away their sewage, cut their grass and they still complain. My driver pays $500 a month to rent a small house and I can assure you he would like to trade places with those people anytime. And I can assure you I can find another 16,000 people on the list who would give an arm and a leg to receive those houses.