The Politics of Federalism: Oil Royalty Claim of Sabah

Abstract

The close relationship between the federal government and the state government of Sabah under the leadership of Barisan Nasional (BN) is considered to give the latter an advantage to claim oil royalty higher than five percent. The concept of federalism implemented in this country is the core of the agreement signed between the federal government, Petronas, and the state government of Sabah. This study used primary data obtained through interviews with two politicians and information from the Sabah State Legislative Assembly Statement. It also gathered secondary data from relevant articles and local newspapers pertaining to the issue. The findings revealed that despite the close relationship between the federal government and the Sabah state government, it did not give an advantage for the latter to claim for higher oil royalty.