Restoring the Constitutional Status of Sabah and Sarawak: First Step in A Long Journey of Redemption

By Wilson Tay Tze Vern, 29 March 2019
Map of Malaysia
Map of Malaysia


Developments in three Malaysian general elections since 2008 have given new political significance to the East Malaysian states of Sabah and Sarawak with potentially fascinating and unprecedented consequences. Situated on the island of Borneo, across the South China Sea from peninsular or ‘West’ Malaysia, Sabah and Sarawak have had a complex – if at times uneasy – relationship with the rest of the federation since September 1963, when Malaysia was formed.

Restoring Constitutional Status

The recent decision of the Malaysian Cabinet to amend Article 1(2) of the Federal Constitution regarding the constitutional position of Sabah and Sarawak, which has sparked considerable excitement, must be understood in the context of the evolving relationship between the two regions of Malaysia. Essentially, the Cabinet’s decision, which is supposed to be enacted via constitutional amendment in the current parliamentary sitting, seeks to restore Article 1(2) to what it was from 1963 to 1976, before that provision was amended by the previous Barisan Nasional (BN) government to its current form.

As it originally stood, Article 1(2) provided that ‘the States of the Federation’ shall be: (a) the States of Malaya, comprising the eleven states in peninsular Malaysia which constituted the erstwhile Federation of Malaya (1948-1963); and (b) the Borneo States, namely Sabah and Sarawak. A third category, ‘the State of Singapore’, was deleted from 9 August 1965, when Singapore separated from the federation. The original Article 1(2) thus clearly enshrined the separate status of the States of Malaya and the Borneo States, corresponding to the numerous autonomous powers enjoyed exclusively by the latter within the federal structure of Malaysia.

However, in 1976, Article 1(2) was amended so as to merely list all thirteen states of the federation in alphabetical order, within a single category. This amendment has thus been regarded by many as having ‘downgraded’ Sabah and Sarawak to equivalence with each of the eleven states of Malaya, despite the fact that Sabah and Sarawak partnered with the Federation of Malaya as a whole – not its constituent states – in establishing the new federation of Malaysia. Indeed, because of initial delays to the founding date of Malaysia, Sabah (then named North Borneo) and Sarawak were briefly independent of British colonial rule in their own right, before formally constituting the new federation on 16 September 1963. This ‘demotion’ has therefore added to a growing list of grievances held by some quarters in Sabah and Sarawak against the federal government, aggravating a sense that the spirit of the Malaysia Agreement 1963, the international treaty between the United Kingdom, Malaya, North Borneo, Sarawak, and Singapore that established the new Federation of Malaysia, has not been complied with by the federal authorities.

The Rising Influence of East Malaysia

Sabah and Sarawak constitute approximately 60% of the total land area of Malaysia, and these states have long been a major source of natural resources – principally petroleum, natural gas, and timber – that have funded much of the country’s development.

When Malaysia was formed, concerns over the maintenance of these states’ unique identities as autonomous regions with distinct historical and cultural contexts prompted the negotiation of certain heads of agreement known as the ‘20-Point Agreement’ in the case of Sabah, and the ‘18-Point Agreement’ with Sarawak. Not all of these points were subsequently formalized into law but pursuant to the Malaysia Agreement, the Federal Constitution, and legislation, such as the Immigration Act 1959/63, do accord a degree of autonomy and additional powers to Sabah and Sarawak that are not available to other states. For instance, Sabah and Sarawak can control immigration into their states (including immigration from the rest of Malaysia), maintain a separate legal profession and a separate land code, and receive additional sources of revenue not available to the other states.

In recent years, there has been a clear sense of dissatisfaction in Sabah and Sarawak at how these states have been treated by the federal government. Particularly, there is increasing disquiet over the extraction of natural resources from these states for little in return. Under the Petroleum Development Act 1974, ownership and exclusive rights over all petroleum resources in Malaysia are vested in a national oil corporation under the control and direction of the federal Prime Minister. However, oil-producing states such as Sabah and Sarawak receive only 5% of all petroleum revenue obtained from their state as ‘royalty,’, with the remainder effectively placed at the disposal of the federal government. Thus, despite contributing the largest share of the nation’s oil wealth, Sabah and Sarawak consistently rank among the poorest states in the federation. These states – particularly Sabah – are also relatively underdeveloped compared to West Malaysia, and face a significantly higher incidence of poverty. Lack of infrastructure and employment opportunities in East Malaysia have driven many to the peninsular states and abroad.

The cause of Sabah and Sarawak began to occupy the mainstream of Malaysian political discourse following the 12th general election in March 2008. The then ruling coalition BN lost much of its support in West Malaysia and became completely reliant on its East Malaysian component parties to maintain a parliamentary majority. This gave Sabah and Sarawak, which jointly elect approximately 25% of MPs in the federal Parliament, significant leverage over the federal government, resulting in East Malaysian leaders being appointed to key federal positions such as Foreign Minister, Minister of Rural Development, and Speaker of Parliament.

The ‘kingmaker’ influence of Sabah and Sarawak increased further with the subsequent election in 2013, when the BN lost the popular vote and retained a slim parliamentary majority only because of Malaysia’s heavily gerrymandered electoral constituencies. Consequently, the support of Sabah and Sarawak lawmakers became even more crucial. More concessions were extracted, such as the long-overdue construction of the Pan-Borneo Highway. Charismatic leaders such as the late Adenan Satem (Chief Minister of Sarawak from 2014-2017) were also able to press for greater autonomy and a higher share of natural resource revenues for the East Malaysian states.

At the 14th general election in 2018 the then opposition Pakatan Harapan (PH) coalition – clearly aware of the strategic position – made a determined bid for the Sabah and Sarawak constituencies by addressing an entire section (or ‘pillar’) of its election manifesto, consisting of 9 key promises, specifically to these states. These promises included an express commitment to restore Sabah and Sarawak’s position ‘to their rightful place, in line with the 1963 Malaysia Agreement,’ and to establish a Commission to review and rectify the implementation of that Agreement. The pitch succeeded as PH and its partner, Parti Warisan Sabah (Heritage Party of Sabah), captured sufficient seats to finally unseat the BN at the federal level. Once again, the support of Sabah and Sarawak lawmakers – this time in Parti Warisan and the Sabah and Sarawak wings of PH – is crucial to the federal government.

Seen in light of this progression, the proposed constitutional amendment is both a logical step towards the fulfilment of PH’s electoral promises, and a timely move in the two states’ quest to implement the true spirit of the Malaysia Agreement.

Prospects of Redemption

At present, the PH-led government does not command a two-thirds majority in Parliament which would be constitutionally required in order to amend Article 1(2). Nonetheless, it can count on the support of Sarawak-based regional parties currently within the opposition Gabungan Parti Sarawak (Sarawak Parties Coalition - GPS), as well as former BN lawmakers from Sabah (who have since turned independent), to achieve this threshold.

However, the amendment must also secure a two-thirds majority in the Senate, or Upper House of Parliament, where the BN maintains a sufficient presence to deny its passage. As the failure of the attempt to repeal the Anti-Fake News Act last year demonstrates, the BN’s current albeit temporary control of the Senate could threaten the new government’s legislative agenda. If the amendment is indeed tabled in the current parliamentary sitting, it would be interesting to see if BN Senators acquiesce in the reversion of Article 1(2).

The Long Road Ahead

It remains a valid question as to how restoring the pre-1976 wording of Article 1(2) could enhance the position of Sabah and Sarawak, either in law or in fact. Three issues remain. First, clarity is still needed as to the precise nature of the intended amendment, which has yet to be published by the government. As indicated above, a mere reversion to the earlier wording would not actually change the status of Sabah and Sarawak as ‘states’ of the federation (as the de facto Law Minister and some others have reportedly asserted), but merely place them in a separate category of ‘the Borneo States.’ Second, as a matter of law, the special autonomous powers, enjoyed exclusively by the two states, derive from specific provisions of the Federal Constitution (such as Article 161E and the Ninth Schedule) and federal legislation, and they do not depend on the structure of Article 1(2). It is also unclear how rewording Article 1(2) per se could help resolve actual legal issues currently outstanding between Sabah and Sarawak and the Federation, such as ownership over natural resources. Third, and most importantly, it remains to be seen how the amendment of Article 1(2) would help resolve socio-economic problems currently existing in Sabah and Sarawak. For instance, the relative lack of physical infrastructure development, lack of economic opportunities, and rampant illegal immigration (in the case of Sabah).

Ideally therefore, the amendment of Article 1(2) would be the first of many steps, soon to be taken, towards restoring the spirit of the Malaysia Agreement 1963 and lifting the status of Sabah and Sarawak, as explicitly promised in the PH electoral manifesto. The proposed amendment – if it materializes – would certainly be most welcome as a signal of the new government’s intent and sincerity. However, it must be followed by further concrete measures if it is to be more than mere window dressing.


For Sabah and Sarawak, the change of government at federal level following the general election in 2018 presents a historic opportunity to rectify decades of perceived neglect and exploitation. It is the culmination of a remarkable series of events that has given unprecedented leverage to Sabah and Sarawak-based parties in seeking a genuine rebalancing of a federal arrangement that has clearly been less than ideal for the two states. While the proposed amendment to Article 1(2) is indeed timely, it is also imperative that further substantive measures towards honouring the spirit of the Malaysia Agreement 1963 be conceptualized and implemented as a matter of urgency. The future stability of the Malaysian federation demands no less.

Wilson Tay Tze Vern is a PhD Candidate at the National University of Singapore’s Faculty of Law, and a Graduate Researcher at the Faculty’s Centre for Asian Legal Studies.

Disclaimer: The views expressed in Voices from the Field contributions are the author's own and do not necessarily reflect International IDEA’s positions.


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