Her Majesty Raja Zarith Sofiah, Queen of Malaysia (front row, fifth from left), during her visit to Labuan in November 2024.
THE Pearl of Borneo. This is what tourists are calling Labuan, which is just two-and-a-half hours by flight from Kuala Lumpur.
Situated off the coast of Sabah, it is known as a paradise for seafood lovers and a diver’s haven.
Gourmets will attest to the size of its deep-sea giant tiger prawns which can grow to the size of a human adult’s palm!
Declared as Malaysia’s second Federal Territory on Feb 1, 1984, Labuan is now known as an international business and financial centre.
It has been a duty-free port since 1956 and got its international offshore financial centre status in 1990.
This explains why an island that is smaller than Penang and with only a population of 102,300 was able to contribute RM1.2bil in fiscal revenue to the country in 2023, according to a report by Labuan International Business and Financial Centre (Labuan IBFC).
There is an interesting theory on how the island has managed to preserve its environment for ecotourism, despite being a thriving business hub.
Giving an oral history is Datuk Chin Chee Kee, the founder of Noblehouse International Trust, one of the earliest financial services companies on this island.
Labuan’s Pulau Rusukan Besar is known for its beautiful beaches.
“The island, which is 30km from Brunei, was once a port for the Bruneians, who would use our fishing boats to ferry goods. That stopped after they built the Muara port.
“We also had a barter trade going with the southern Philippines but this also stopped in the 1990s,” recalled Chin in a 2015 interview with StarMetro.
“The government had to come up with an idea to sustain the population,” he said.
“Because of the complex transportation logistics, manufacturing factories would not do as well.
“Commercial agriculture was also out of the question because of land constraints and manpower.
“That was when they decided to turn Labuan into a low-tax jurisdiction and this created a ‘smokeless’ industry in the form of financial services,” he added.
Sun, sea and nature
Labuan is also a paradise for nature lovers.
Green turtles have been spotted on Tanjung Aru beach, which is situated on the eastern coast of the island.
The Labuan Chimney is a historical landmark, built in the early 1900s and a remnant of the federal territory’s coal mining era.
In 2023, Labuan Fisheries Department director Faizal Ibrahim Suhaili said two were spotted.
In October 2024, the Civil Defence Department rescued a stranded turtle from Sungai Pagar beach (more popularly known as Pantai UMS as it is just next to Universiti Malaysia Sabah Labuan International Campus) which is at the southern-most part of the island’s west coast.
Labuan Corporation, the local authority for the island, has listed 14 beach areas under its jurisdiction and has taken the responsibility to keep these areas clean.
In 2008, it received the COBSEA (Coordinating Body on the Seas of East Asia) Clean Beach Award that comes under the United Nations Environment Programme.
Since then, the entire 15.5km stretch of beach on the island’s western coast from Batu Manikar to Sungai Pagar has come to be known as “United Nations Beach”. The monument is in Sungai Pagar.
To truly immerse oneself in Labuan’s natural scenery, go on a hike. The Tanjung Kubong Trail, located at the top-most western part, is most popular among hikers.
Ideally, one should begin the 3.8km trail at the Labuan Bird Sanctuary in Jalan Tanjung Kubong. There are interesting stops on the route, like the Labuan Chimney Museum – a 40m-deep shaft that was once used to access underground coal-mining tunnels, a British graveyard with tombstones dating back to 1866 and an old ammunition storage facility.
Bring your swimsuits along, as the trail will take you to the tip of Tanjung Kubong, an idyllic spot of beach with blue waters.
There is a sea cave near this area and rock formations with visible coal layers. A campsite is nearby too.
The Labuan International Sea Challenge in April 2024 also had a deep-sea fishing competition.
The ultimate nature walk is found at the Kina Benuwa Permanent Forest Reserve. Located at the southern end of Labuan, visitors can access the mangrove forest via shady interconnected boardwalks.
The wetland “residents” here include mudskippers, otters and milky storks which have been listed as endangered by the International Union for Conservation of Nature.
International events
Last July, the Labuan Dive Festival, which saw the participation of 22 divers from Kuala Lumpur, Kota Kinabalu, Labuan, Singapore and France, also highlighted the thriving health of coral reefs in the waters.
The main attraction are four ship wrecks located near Pulau Kuraman, Pulau Rusukan Kecil and Pulau Rusukan Besar that are under the protection and conservation of Labuan Marine Parks.
The most stunning view of sunset is at Ramsey Point, adjacent to the Labuan International Sea Sports Complex at Tanjung Purun beach in Victoria, the heart of the federal territory.
Victoria played host to two major events last year – the Labuan International Sea Challenge (LISC) and Borneo Arts Festival (BAF).
Desmond Ng, 70, who is LISC co-organiser for the deep-sea fishing event, said there were 170 participants from Hong Kong, Macau, Singapore and Brunei.
Fringe events included a kayak race and beach games.
The deep-sea fishing challenge took place at Layang Layang Island, which is 18 hours from Labuan, requiring competitors to charter their own boats for the journey. The heaviest catch was a 58kg giant grouper reeled in by the Hong Kong team who won the grand prize.
The fish was auctioned off and the proceeds were donated to a charity selected by Labuan Corporation. Ng said the 2024 auction raised RM12,000.
He said the number of participants was expected to reach 220 this year for the deep-sea fishing event alone. Fifty participants from Singapore and 55 from Hong Kong have confirmed their entries.
The annual BAF, held at the Financial Park Complex, featured Bornean dances, a creative dance battle and fashion design competition among the highlights.
