Exploring the Entrepreneurial Motivations and Barriers of Agripreneurs in Brunei Darussalam

Introduction

Agriculture was once an important economic activity in Brunei but has declined in importance since the discovery of oil in 1929. In 1947, more than 50% of the population was employed in agriculture but by 1971 this had decreased to 10% (Franz, 1990). In the early 1960s, there was concern about the economic effects of over-dependency on oil and the Second National Development Plan of 1962-1968 focused on agriculture. Increasing rice production was one of the strategies adopted to achieve self-sufficiency and to diversify the economy (Yakub, 2012). In 1970, rice production reached 35% of the self-sufficiency level (Yakub, 2012) and by 1975, it peaked at 38% but has since declined and in 1978 was 14% (DAA, 1990). In the 1970s, farming was characterized by small, family farms: the average farm size was 2.6 hectares and the main crops were paddy, rubber, sago, coconut and pepper (Groome, 1978). Production was mainly for self-consumption and any surpluses were exchanged for other food commodities. Groome (1978) argues that agricultural productivity in the 1970s was low whether measured by output, area, or per capita because production was not market-orientated but was more on meeting the needs of individual households. The agricultural sector combined with forestry and fisheries only contributed 11% to GDP in 1974 and it continued to decline to 8% in 1975 and 5% in 1980. In 2014, the agricultural sector contributed 1% to the GDP (DAA, 2009).

Agriculture still lags behind other sectors. In 2011, it constituted only 3% of the labour force and less than 1% of GDP. This compares with 63% and 72% in the industrial sector and 33% and 27% in the services sector (World Bank, 2012). Nevertheless between 1999-2008, agricultural production nearly doubled in value terms from US$80m to US$160m (DAA, 2009), and in 2011, agriculture, forestry and fisheries recorded the highest annual growth of 5%, followed by construction and manufacturing which grew 2% each.

To assist farmers, the government provides free insecticides and fungicides, technical support, training in modern cultivation techniques and funding incentives. For example, the government under the Paddy Guarantee Price Purchasing Scheme subsidizes rice consumption by buying it from producers at a price more than the market price with the aims of incentivizing more farmers to grown paddy and to ensure that the price of the local rice is competitive. Under this subsidy scheme, the DAA bought rice from local producers at US$12 per 10kg while the retail price for consumers was US$9 per 10kg (DAA, 2009).

However, there is still a problem of labour scarcity in the agricultural sector in Brunei where there exists a poorly skilled, ageing workforce and a high dependency on migrant labour. In 2014, the number of people working in agriculture was 5,218 of which 704 were involved in livestock production, 4,382 in crops and 132 in agri-food processing (Brunei Government, 2015). Statistics has also shown a decrease in the percentage of labour force in agriculture from 0.69% in 1998 to 0.54% in 2008 and the percentage decrease in the rural population which can be partly attributed to the declining agricultural labour force. Under the DAA's mid-term action plan (2008-13), increased efforts to upgrade technology and human resource capacity are highlighted.

This study examines the entrepreneurial motivations of fifteen agripreneurs in Brunei with the aim of learning from their experiences so that further improvements can be made in the agriculture sector in order for Brunei to successfully achieve its vision of food security and self-sufficiency.