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Is Brunei passing homophobic law to boost investment?

Some analysts say the introduction of extreme sharia laws is designed to encourage more investment and tourism.

Generally, governing authorities don’t like seeing the amount of money they have to spend go down. They use that money to do things like pay civil servants, build roads and (sometimes) enrich themselves.

There are lots of ways they can get their hands on more money. They could raise taxes, say, or take out more debt. But a popular way (because it doesn’t impose financial costs on locals) is to get foreigners to give them money through things like foreign direct investment (setting up a business, basically) or tourism.

Bizarre as it may sound, some analysts think this is the reason Brunei recently introduced extreme Islamic punishments. The introduction of laws which allow stoning gay men and adulterers to death, and cutting the hands off thieves, has recently been met with wide condemnation.

It is true that Brunei needs to get more money from somewhere. The oil and gas most of its wealth currently comes from is running out. Fewer barrels of the stuff are being sold and oil and gas companies (who provide a lot of the investment, infrastructure and expertise) are moving out.

This theory is that the ruling Sultan of Brunei is trying to boost Brunei's position as a super-pious place in the hope it will encourage certain groups of Muslim businesspeople and tourists to pick Brunei over other countries for their investments and holidays.

If Brunei is planning to use the violation of human rights as a money maker, it’s taking a hell of a risk. It may end up cutting off revenue streams from the large portion of the world (including many Muslims) who are horrified by such barbaric treatments. Indeed, several celebrities are already calling for a boycott of Brunei-owned swanky hotels.

Read our explainer on: foreign direct investment.

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Reader Comments

  • Interesting story. I’m planning a business trip to Prato. Hopefully I will find what I need there.