Budget 2027’s RM3.3 billion allocation for road projects in Sabah and Sarawak will support key links including the Trans Borneo Highway, Sarawak-Sabah Link Road and Pan Borneo Highway in Sabah, as the federal government steps up efforts to improve rural connectivity in both states.
Deputy Prime Minister Datuk Amar Fadillah Yusof said the budget also provides funding for electricity supply in Sabah, dilapidated school upgrades and healthcare facilities in Sarawak, alongside measures to strengthen economic opportunities and fulfil commitments under the Malaysia Agreement 1963 (MA63).
Sabah and Sarawak will receive RM18.7 billion and RM16.2 billion respectively, with each state’s allocation increasing by RM1.1 billion from the previous year.
For Sabah, RM600 million will be channelled towards ensuring continuity of electricity supply, supported by a RM204 million STATCOM installation and the continuation of the Southern Link transmission line project. These measures come despite the transfer of electricity regulatory powers to the state government.
In Sarawak, planned spending includes the development of the Sibu Special Economic Zone, construction of the Kuching Dental Specialist Centre and a specialist centre for elderly care, as well as the Kuching Urban Flood Mitigation Plan.
Education remains another major focus, with nearly RM1.3 billion allocated to upgrade 682 dilapidated schools, particularly in Sabah and Sarawak. The government will also double Public Service Department scholarship offers for students from both states, creating opportunities for 4,200 students annually.
On MA63, the interim special grant has been increased threefold to RM1.5 billion, while negotiations continue to finalise an annual grant formula.
Fadillah said the allocations reflected the federal government’s commitment to ensuring development in Sabah and Sarawak translates into tangible benefits for residents, particularly through better basic infrastructure, public services and rural access.
