Labuan is a Federal Territory of Malaysia, governed directly from Kuala Lumpur. Labuan comprises the main island and six smaller islets that cover an area of just over 95 sq. km. Labuan is centrally located right in the middle of the Asia-Pacific region in the South Chian Sea.
The name Labuan is a Malay word that means port or anchorage. So highly regarded were Labuan’s natural anchorage features and harbors, the early European settlors thought Labuan was ideal for many uses including commercial trading post , naval bases and a refuge for ships damaged by pirates. In fact, today, Labuan is a strategic naval and air force base for East Malaysia.
Labuan is a flat, heavily vegetated and forested island, More than 70 percent of the island terrain is used mostly for residential and industrial use and there is not much agricultural activity; coconuts, rubber, and rice are the main agricultural products. Shipbuilding, oil and gas industries and some manufacturing activities are found on the island.
Tourism is becoming a major economic feature for the islands, and much emphasis is being placed on tourism development. Much of the island’s prime land, waterfront and suburbs are utilized for residential and tourism development.
Labuan had been influenced by the rule of many empires including the Majapahit Empire, theBrunei Sultanate, the British Empire and the Japanese Empire. The British regained control of Labuan island until 1963 when Labuan joined Malaysia and became a part of Sabah. It was not until 1984 that Labuan became a Federal Territory of Malaysia and in 1990, was officially declared an International Offshore Financial Centre in 1990, where liberal tax rules apply to offshore companies, like Seychelles company. The Malaysia Ringgit (RM) is the legal currency in Malaysia. Set at 1USD = RM3.8
As a Federal Territory of Malaysia, which is a democracy based on the parliamentary system of government. The population of Labuan is 78,000 comprising of Malay, Chinese, Indian, and other minority groups. The national language is Bahasa Melayu, English, Chinese and Tamil are widely spoken.
Bandar Labuan is the main town, where much of commercial trace activity is conducted. Labuan’s airport and the ferries operate in Bandar. In 1956, Labuan was restructured as a free port meaning that no import duties are paid on any goods (excluding liquor, tobacco, cigars, cigarettes, and petroleum products). No export duty is paid on goods exported from Labuan. As such, Labuan’s tax-free status, duty-free shopping and customs exemptions are attractive features. Labuan is surrounded by breathtaking islands, pristine beaches and major tourism activities.