Brunei's gross domestic product (GDP) is expected to increase by 1.8 to 2.0 percent in 2013-2014, according to the latest report of Asian Development Bank (ADB).
In its latest Outlook 2013 report, the ADB said the projection assumed a modest recovery in hydrocarbons production and continued growth in the rest of the economy during the forecast period.
The report highlighted that the Bruneian government aims to extend the productive life of hydrocarbons until other pursuits of economic diversification can play a significant role in the economy.
"This is to be achieved by enhanced recovery and managed production from existing oil and gas (081G) fields and exploration of new ones.
"On this basis, GDP is projected to increase by 1.8 to 2.0 percent in 2013-2014", the report said.
Despite the nominal growth in GDP, private consumption increased by 4 percent for the period under review, above the average registered in the past five years. Sales of new automobiles jumped by 28 percent while increases in private consumption were underpinned by high employment, low inflation -- courtesy of strong government revenue flows from hydrocarbons -- absence of taxes on personal incomes, goods and services or capital gains.
Brunei's GDP per capita of 44,000 U.S. dollars in 2012 was the highest in developing Asia, after Singapore and China's Hong Kong, the report said.
Inflation decelerated from 1.2 percent year-on-year at the start of 2012 to 0.4 percent in December of the same year.
"Prices of food, particularly meat and cooking oil, rose, but this was mostly countered by lower prices for clothing, education and transport," the report said, adding that price controls and subsidies helped keep inflation low.
ADB said that Brunei sees gains made toward broadening the economic base as more important for longer-term./.