Brunei's GDP and whatever..

Aiming for growth using GDP system problematic

Sobrina Rosli
BANDAR SERI BEGAWAN

Friday, April 11, 2008

MEASURING Brunei's economic growth using the gross domestic product (GDP) system of national accounts can result in misleading indications, which in turn give way to unsustainable methods of boosting the health of the economy.

The GDP system of national accounts is deemed not suitable to Brunei whose economy is still highly dependant on oil and gas production, said Dr Roger Lawrey, acting dean of the Faculty of Business, Economics and Policy Studies, Universiti Brunei Darussalam.

"One implication of this is that targeting a (particular) rate of GDP growth for the future could be problematic," he said in an interview with The Brunei Times.

"If that rate is achieved by increasing oil and gas production, Brunei might be simply reducing its reserves of oil and gas, leading to increased problems in the future," Lawrey said. "If, however, this growth rate is targeted at the non-oil and gas sector, the result, if achievable, could be sustainable."

The thing is Brunei at this point still relies heavily on oil and gas, and without any huge spike in the production of these commodities no perceptible positive change in GDP numbers can be reflected.

GDP figures are usually analysed using constant figures meaning changes in the value of production are tracked using a product or service' price level at a particular base year and not that of the period in review.

The Brunei Times (http://www.bt.com.bn/en/home_news/2008/04/11/aiming_for_growth_using_gdp_system_problematic

How much have you accumulated all these years?

The only thing we know is about some of our rich people appearing on the internet and apart from that is all about guesswork.