SANDAKAN: The persistent development gap in Sabah is not a reflection of inadequate resources or effort, but a direct consequence of insufficient state revenue.
While substantial investments enter the state, their fiscal benefit remains limited as the resulting revenues are not fairly returned. Investment figures alone cannot build roads, schools, or hospitals; sustainable development requires reliable and constitutionally mandated state income.
This was emphasized by former Tanjong Papat assemblyman Datuk Frankie Poon Ming Fung in a statement on Tuesday.
“The core of this issue is constitutional. Articles 112C and 112D of the Federal Constitution guarantee Sabah 40% of the net federal revenue derived from the state—a right affirmed by the High Court and rooted in the Malaysia Agreement 1963 (MA63). This is a binding legal obligation, not a subject for political negotiation,” stated Poon.
He stressed that implementing this right is a fundamental test of constitutional compliance and the rule of law. A financially empowered Sabah could independently fund critical infrastructure and public services, thereby reducing long-term dependency on federal allocations and fostering more balanced regional development.
“Honouring this obligation strengthens the Federation; it does not weaken it,” Poon added. “It would restore confidence in Malaysia’s founding agreements and judicial institutions, providing the certainty necessary for political stability and investor confidence.”
He argued that economically empowering Sabah unlocks its full potential, enabling the state to contribute more significantly to national GDP, employment, and security.
“A stronger Sabah unequivocally means a stronger Malaysia,” Poon continued.
Furthermore, fulfilling this entitlement reaffirms Sabah’s constitutional status as an equal founding partner in the Federation, reinforcing the principles of genuine federalism, unity, and mutual respect.
Poon concluded with a clear call to action: “The Federal Government must discharge its duty by commencing payment of the 40% entitlement based on a transparent formula. It should also establish mechanisms enabling Sabah to collect its revenues, retain its constitutional portion, and remit the balance.”
“This proposal is not about seeking preferential treatment. It is about implementing long-held constitutional rights and giving full effect to the existing provisions of our Constitution. Upholding MA63 and the 40% entitlement is an act of constitutional duty and national integrity, essential for the long-term strength and unity of Malaysia,” he said. – James Leong
Poon argued that economically empowering Sabah enables the state to contribute more significantly to national GDP, employment, and security.
