Executive synopsis :
- Sarawak’s high-income status masks a 12.9% poverty rate, exposing the limits of income-only metrics and the need for a tailored multidimensional poverty index.
- Urban poverty is driven by high living costs, overcrowding, elderly isolation, chronic illness, and fragmented aid; rural poverty is defined by remoteness, poor utilities, and infrastructure gaps.
- A Kuching pilot study found 88.3% of urban poor households destitute, 61% elderly, and 32.1% receiving no formal welfare, revealing serious social protection gaps.
- Under the 13th Malaysia Plan and PCDS 2030, Sarawak is investing RM9.3 billion in rural infrastructure and expanding SKAS to 874,878 recipients to move beyond temporary cash aid.
- A dual urban-rural MPI and coordinated, person-centred welfare system can align Sarawak’s GDP success with shared, dignified, and inclusive well-being.
Full article:
Sarawak’s Inclusive Growth Lifts Every Community Toward Dignity
When macroeconomic prosperity collides with microscopic vulnerability, Sarawak emerges as a compelling case study in the limits of traditional poverty measurement. The World Bank has classified Sarawak as a high-income state, a label driven by substantial gross domestic product performance from capital-intensive oil, gas, and energy sectors. Yet beneath this glittering aggregate narrative lies a far more uncomfortable reality. As recently as 2020, Sarawak recorded a poverty rate of 12.9 percent, the third highest among Malaysian states. The paradox of a “rich state with poor people” constitutes the deepest tension in the region’s development trajectory.
With the activation of the 13th Malaysia Plan (2026–2030) and the ongoing execution of Sarawak’s Post-COVID-19 Development Strategy (PCDS 2030), policymakers and research institutions are gradually shifting their focus from simple income metrics to more nuanced, non-monetary deprivations. The Sarawak Development Institute (SDI) has explicitly argued that the state requires a tailor-made Multidimensional Poverty Index (MPI) to accurately assess poverty conditions and implement precise interventions. This is not merely a methodological adjustment; it is a fundamental re-examination of the question: for whom is development pursued?
The paradox begins with the numbers themselves. Sarawak possesses Malaysia’s highest urban Poverty Line Income (PLI), standing at approximately RM2,860. This figure reflects an exceptionally high cost of living that pushes vulnerable populations below the poverty threshold far more easily than in other states. While the national average PLI had risen to RM2,718 by 2024, Sarawak’s urban benchmark remained distinctly elevated at RM2,860, underscoring the severe cost-of-living pressures in its cities. At the same time, poverty persists at alarming rates in certain districts. In Dalat, for instance, roughly 2.85 percent of the population remained registered in the e-Kasih national poverty database using a lower PLI benchmark of RM2,182.
This statistical contradiction is rooted in the deep structural imbalances of Sarawak’s economy. The macro-level high-income status is overwhelmingly driven by capital-intensive sectors such as oil, gas, and energy. These industries generate enormous GDP but do not automatically translate into high median household incomes for rural and marginalised communities. As the Sarawak Land and Survey Department itself acknowledges, “It is undeniable that poverty still exists in Sarawak, to the extent that some compare Sarawak with Perlis, a state where poverty is not considered a major issue.” The gap between aggregate wealth and local lived experience could hardly be starker.
The limitations of traditional income-based indicators have given rise to the adoption of the Multidimensional Poverty Index (MPI). The Department of Statistics Malaysia (DOSM) formally introduced the MPI framework in 2015, evaluating deprivation across three core dimensions: education, health, and standard of living. By 2024, the national MPI had fallen to 0.0025, yet significant regional disparities remain. Rural areas still recorded an MPI score of 0.0109, and Sarawak, together with Sabah, continues to host the highest concentration of multidimensionally poor households in the country.
Research conducted by SDI further reveals a fundamental divergence between urban and rural poverty profiles across Sarawak. Urban deprivation is heavily defined by density and cost. In major city centres such as Kuching and Miri, low-income communities face severe overcrowding, with approximately 33.6 percent of households living in cramped conditions, alongside poor housing quality in informal squatter settlements. Although subsidised healthcare is technically accessible, the burden of secondary costs, including private transport for dialysis or specialised treatments, places immense strain on family budgets. Urban poverty is therefore a story of high living costs, limited spatial resources, and hidden healthcare expenses.
Rural poverty, by contrast, is defined by remoteness and infrastructure deficits. Inland communities remain terrain-locked, with limited road connectivity that restricts market integration and access to basic services. Healthcare provision depends heavily on mobile clinics or river transport. While universal primary school enrolment has been achieved, quality gaps in physical school infrastructure continue to persist. Rural poverty is thus characterised by geographic isolation, lack of basic utilities, and asset deprivation—a profile fundamentally different from its urban counterpart.
This urban-rural dichotomy implies that a single, unified poverty measurement framework cannot adequately capture the reality of poverty in Sarawak. SDI’s research explicitly recommends the development of separate MPI frameworks for urban and rural areas, each calibrated to address the specific challenges of its context.
A definitive pilot study conducted by SDI in collaboration with the Society for the Kuching Urban Poor (SKUP), titled “Multidimensional Poverty Index and Qualitative Study Among Urban Poor: A Case Study of Kuching,” offers a sobering glimpse into the lived realities of urban poverty. Drawing on a sample of 137 food aid recipients across key metropolitan nodes, the study exposed a dramatic disconnect between aggregate state wealth and the survival strategies of local communities.
The demographic profile of the study’s respondents challenges many conventional assumptions about urban poverty. A striking 61 percent of respondents were aged 60 or above, reflecting a heavy concentration of poverty among senior citizens. Women made up 56.9 percent of the sample, and over half of the surveyed households, 53.9 percent, were either single-person or dual-person elderly households. Educational capital was severely limited: 62 percent of the older generation possessed only primary schooling or had never received any formal education. Across all adults in the study, 37.2 percent had not completed the baseline eleven years of secondary schooling.
The income situation was dire. Every single respondent lived below Sarawak’s urban PLI of RM2,860, and an astonishing 88.3 percent were classified as destitute, earning less than half of that threshold. While subsidised public healthcare kept nominal facility deprivation low at 8.8 percent, an alarming 79.6 percent of households suffered from severe chronic illnesses, led by high blood pressure at 58.4 percent, high cholesterol at 33.6 percent, and diabetes at 20.4 percent. These figures paint a picture of a population trapped not only by low income but also by persistent health burdens that further erode their economic resilience.
Beyond the quantitative data, the study uncovered four distinct socioeconomic phenomena unique to Kuching’s urban landscape. The first is the emergence of what researchers call “Naturally Occurring Retirement Communities,” or NORCs. Due to low incomes and a lack of institutional senior care facilities, specific low-cost housing sectors have organically transformed into senior-dominated neighbourhoods. Elderly individuals increasingly live isolated from their immediate families and rely entirely on neighbours for basic physical check-ins and survival support.
The second phenomenon is intergenerational strain. The quantitative evidence of elderly isolation is closely tied to severe domestic economic pressures. The study documented cases of emotional and financial neglect, and in some instances outright abandonment of elderly parents, driven by younger family members buckling under the high cost of urban living in Kuching. The traditional family safety net, once the cornerstone of social support in Malaysian society, is showing visible signs of erosion.
The third trend is the paradox of “subsidised care with high secondary costs.” While medical treatment at government clinics is heavily subsidised, the lack of accessible urban public transportation forces high-risk patients, such as those requiring thrice-weekly dialysis, to rely on expensive e-hailing options. This converts routine healthcare into a recurring debt trap, undermining the very purpose of public health subsidies.
The fourth finding concerns the fragmented nature of social assistance. Despite the existence of large-scale federal cash programmes, 32.1 percent of these critically poor households received zero formal welfare aid. The reasons include complex digital application barriers and a simple lack of awareness about available support. In response, informal neighbourhood networks, such as those in the Sungai Apong area, have stepped in to manually organise and redistribute food packs, filling the gaps left by a fragmented and often inaccessible formal safety net.
These four phenomena are not isolated anomalies; they are symptomatic of deeper structural weaknesses in Sarawak’s approach to social protection. They highlight the urgent need for a more coordinated, accessible, and person-centred welfare system that reaches those who are most in need.
In response to these challenges, the state government is utilising federal allocations alongside the Sarawak Budget 2026 to re-engineer its poverty alleviation strategies under the 13th Malaysia Plan. The approach involves moving away from a one-size-fits-all cash aid system towards a cohesive social safety net that coordinates the historically fragmented patchwork of support from NGOs, state agencies, and federal programmes. The 2026 development budget channels massive capital, exceeding RM9.3 billion, into rural infrastructure, utilities, and agricultural modernisation. The objective is to generate sustainable, multi-year income rather than temporary relief, thereby addressing the root causes of rural poverty.
Under PCDS 2030, Sarawak aims to raise the median monthly household income to RM15,000, explicitly focusing on balancing regional disparities to ensure that macroeconomic wealth translates into localised well-being. The Sarawak Social Welfare Scheme (SKAS) is projected to benefit 874,878 recipients in 2026, marking a significant expansion of formal social protection. Yet the numbers alone, impressive as they are, cannot capture the human realities that lie behind them.
The pilot study’s findings are sobering reminders that poverty in Sarawak is not a monolithic phenomenon. Urban deprivation is dominated by high cost-of-living burdens, severe overcrowding, and adult education limits, while rural poverty is characterised by geographic isolation, lack of basic utilities, and infrastructure deprivation. Any effective policy response must therefore be differentiated, recognising that what works in Kuching may not work in Kapit, and that the needs of an elderly urban couple are fundamentally different from those of an inland farming community.
Local think tanks, including SDI, strongly advocate for a separate, dual-framework MPI for Sarawak that elevates threshold metrics, shifting the target from primary to secondary education completion and incorporating healthcare affordability as a core indicator. Such a framework would not only provide a more accurate diagnostic tool but also guide resource allocation towards the most pressing deprivations. It would acknowledge that poverty is not merely a lack of income but a lack of opportunity, dignity, and security.
The challenge for Sarawak, as it moves forward, is not to generate more economic growth in the abstract. The state has already demonstrated its capacity to produce wealth. The real challenge is to ensure that this prosperity reaches every community, every household, and every individual, regardless of their location, age, or ethnicity. When 61 percent of urban poor respondents are elderly citizens, when 88.3 percent of poor households are destitute, and when nearly one-third of the extreme poor are entirely excluded from formal welfare, it becomes clear that the existing system is falling short. These numbers are not mere statistics; they represent the lived struggles of real people.
Ultimately, the poverty paradox of Sarawak is a question of what development truly means. Is it measured by GDP growth, or by the security of an elderly widow in a low-cost flat? Is it defined by high-income status, or by the ability of a rural child to complete secondary school without being forced into early labour? The answers to these questions will determine whether Sarawak’s prosperity is merely statistical or genuinely shared. The adoption of a multidimensional, locally calibrated approach to poverty measurement, combined with a more coordinated and accessible social protection system, offers a way forward. It will not be an easy path, but it is the only path that honours the dignity of every Sarawakian.
As the state implements the 13th Malaysia Plan and pursues the goals of PCDS 2030, it has a unique opportunity to demonstrate that economic transformation and social justice can go hand in hand. The data already tell part of the story, but understanding the human realities behind those numbers will be essential to building a more equitable and inclusive Sarawak. The challenge is not merely to count the poor, but to ensure that poverty itself is counted out of existence. That is the true measure of progress.
References:
Department of Social Welfare Malaysia. (n.d.). e-Kasih national poverty database.
Department of Statistics Malaysia. (2015). Multidimensional Poverty Index (MPI) framework.
Government of Malaysia. (2026). 13th Malaysia Plan (2026–2030).
Sarawak Development Institute. (n.d.). Multidimensional poverty research in Sarawak [Research on urban and rural poverty profiles].
Sarawak Development Institute, & Society for the Kuching Urban Poor. (n.d.). Multidimensional Poverty Index and qualitative study among urban poor: A case study of Kuching.
Sarawak Government. (2026). Sarawak Budget 2026.
Sarawak Government. (n.d.). Sarawak Post-COVID-19 Development Strategy (PCDS 2030).
Sarawak Land and Survey Department. (n.d.). Poverty and land issues in Sarawak [Official statement on poverty existence]. World Bank. (n.d.). Country classification [Sarawak high-income state status].
