Sabah offers multiple industrial parks with sound infrastructure, strategic location, and accessible logistics to facilitate manufacturing activities across a variety of sectors. Currently, the state is expanding its port infrastructure to capitalise on its location in the Brunei Indonesia Malaysia Philippines-East ASEAN Growth Area (BIMP-EAGA) region, opening opportunities to service the larger Asia-Pacific production base whose increasing population and incomes are stimulating a growing market for goods and services.


  • Endowed with rich natural resources, Sabah is ripe for growth in the manufacturing sector through resource-processing activities. Key opportunities include leveraging raw materials as feedstock in downstream processing such as oil and gas, palm oil, timber, and minerals.
  • The state offers several industrial parks to facilitate manufacturing activities across a variety of sectors. These parks offer available dedicated spaces, assisting investors in identifying high-quality land for their activities.
  • The main industrial parks in Sabah — Kota Kinabalu Industrial Park (KKIP), Sipitang Oil and Gas Industrial Park (SOGIP), Sabah Agro-Industrial Precinct (SAIP), and the Palm Oil Industrial Parks in Sandakan and Lahad Datu — offer varying tax incentives such as Investment Tax Allowance of 100% for 10 years which can be offset 100% against statutory income, and also an Investment Tax Allowance of 100% on qualifying capital expenditure for 5 years, or full tax exemption on statutory income for 10 years.

Investment Opportunities

  • KKIP is located seven kilometres from the Sapangar Bay Container Port and offers ready-to-use manufacturing facilities and factory lots, as well as support facilities such as residential areas. As of 2021, 241 companies established operations in KKIP spanning various activities including food products, processing of wood, rubber, plastic and metal materials, electronics and electrical manufacturing, automotive parts, construction materials, as well as logistics and warehousing.
  • SOGIP serves as a focal point for oil and gas investment within the Sabah, Brunei, and Labuan economic centres. Multinational oil production corporation Petronas established its operations at SOGIP in 2016 investing USD$1.9 billion to develop its ammonia, urea, and granulation plant known as the Sabah Ammonia Urea (SAMUR) project.
  • SAIP serves as a hub to develop and process agro-based products, nutraceuticals and biopharmaceuticals. Its facilities include a Post-Harvest Collection and Handling centre, food-processing Production Line Facility, Herb Manufacturing centre, greenhouses and net houses suited for Controlled Environment Farming, Cosmetics and Personal Care Manufacturing Facility, small-medium enterprises lots, and storage facilities. SAIP offers assistance with Good Manufacturing Practices certification from the Standard Industrial Research Institute of Malaysia (SIRIM) and Halal certification from the Department of Islamic Affairs Sabah (JHEAINS).

Recent Investment Activity

  • In 2020, the Malaysian Investment Development Authority (MIDA) approved USD$2.84 billion in manufacturing investments in Sabah across 15 projects.[1]  As of June 2021, Sabah recorded USD$1.04 billion of approved investments from seven companies, making Sabah the third highest state in Malaysia after Kedah and Selangor.[2]
  • In early Q2 2021, South Korean company SK Nexilis invested USD$1.01 billion in a copper foil manufacturing facility to service Malaysia’s EV (electric vehicle) battery manufacturing supply chain, making Sabah a hub for high precision and high-quality copper foil for a variety of applications.
  • In October 2021, construction commenced at SOGIP for Sabah’s first nearshore liquefied natural gas facility. Along with this development, SOGIP also recorded other approved investments including an integrated oleochemicals processing facility, silicon metals production processes, and related support services such as waste management as well as marine services, at a combined value of approximately USD$3.59 billion.[3]

Note: No survey was canvassed in reference years 2016, 2018 and 2019

Source: Department of Statistics, Malaysia

Source: Department of Statistics, Malaysia