Infrastructure
Overview
Sabah's infrastructure, while improving rapidly, still lags behind Peninsular Malaysia in many areas. The state faces unique challenges due to its geography, large land area (73,619 km²), and distributed population centers. However, strategic federal investments—particularly through the Sabah Maju Jaya (SMJ) 2.0 Development Plan 2026–2030—are modernizing roads, ports, airports, and digital networks.
Key projects like the Pan Borneo Highway, KKIA expansion, and Sarawak-Sabah Link Road are reshaping connectivity. Sabah aims to become a logistics hub, supported by renewable energy development and 5G rollout.
Roads and Highways
Sabah has 23,716 km of total road length, including federal and state roads. The backbone is the Pan Borneo Highway, a 706 km mega-project connecting Kota Kinabalu to the east coast via Sandakan and Tawau.
| Route | Length | Corridor | Status |
|---|---|---|---|
| Pan Borneo Highway (Phase 1) | 706 km | KK → Tawau via Sandakan | 78% complete; Phase 1A Oct 2026, Phase 1B Sept 2028 |
| Federal Route 1 (Sabah) | 428 km | West Coast | Operational |
| Federal Route 13 (Sabah) | 268 km | Southeast (Sandakan–Tawau) | Operational |
| Sarawak–Sabah Link Road (Phase 1) | TBD | Kuching ↔ Kota Kinabalu | Expected Nov 2026 |
Budget 2026 allocated RM6.9 billion to Sabah highways, with over RM48 billion announced for Sabah and Sarawak combined road infrastructure over multiple years. This reflects federal commitment to Borneo development.
Main routes include:
- West Coast: KK → Tawau via coastal route (relatively smooth)
- East Coast: Sandakan → Lahad Datu → Tawau (mountainous, under improvement)
- Interior: Remote access roads to Keningau, Kundasang, Ranau (seasonal conditions)
Airports
Sabah has four commercial airports serving domestic and international routes, with Kota Kinabalu International Airport (KKIA) as the primary hub.
| Airport | Code | Status | Services |
|---|---|---|---|
| Kota Kinabalu International | BKI | 9M passengers/year (expanding to 12M by 2028) | International + domestic; RM442.3M upgrade ongoing |
| Sandakan Airport | SDK | Regional hub | Domestic; MASwings connections to KK, Tawau, Lahad Datu |
| Tawau Airport | TWU | 8th busiest in Malaysia (1.7M passengers in 2023) | Domestic + limited international; MASwings main service |
| Lahad Datu Airport | LDU | Regional gateway | Domestic; MASwings flights 5× daily to KK, 40 min to Sandakan |
MASwings (Malaysia Airlines subsidiary) operates regional routes throughout Sabah and connects smaller towns to major hubs. Additional rural airstrips serve remote communities.
Terminal 1 is being upgraded to handle 12 million passengers/year by 2028, with new aprons for 33 aircraft simultaneously and multi-storey car park. Expansion began Q3 2025.
Ports
Sabah operates three primary commercial ports handling containers, general cargo, and transhipment services. Sapangar Bay is the main container terminal.
| Port | Location | Throughput / Capacity | Role |
|---|---|---|---|
| Sapangar Bay Container Port (SBCP) | Kota Kinabalu | 444,000 TEUs (first 10 months 2025); 14M tonnes total; expanding to 1.25M TEUs by 2025 | Main container hub; BIMP-EAGA transhipment center |
| Kota Kinabalu Port (KCP) | Kota Kinabalu | General cargo, containers | Secondary general cargo terminal |
| Sandakan Port | Sandakan | Under expansion | Regional cargo; forest products, fish |
| Tawau Port | Tawau | Under expansion | Regional gateway; palm oil, timber shipping |
SBCP is developed in partnership with DP World and is a key transhipment hub for the Brunei–Indonesia– Malaysia–Philippines East ASEAN Growth Area (BIMP-EAGA).
Power and Water
Electricity
Sabah Electricity Sdn. Bhd. (SESB) generates and distributes power across the state, serving over 600,000 customers across 74,000 km².
- Current Capacity: 866.4 MW total generation; 50.3% sourced from independent power producers (IPP)
- 2026 Projects: 100 MW gas power plant construction; 100 MW large-scale solar farm
- 2024 Award: 199 MW of solar projects awarded to 15 bidders
- Import: Sarawak to export 30 MW to Sabah starting Q2 2025 (Northern Grid Extension)
- Storage: 400 MWh battery storage facility in Lahad Datu (ASEAN's largest, July 2024 completion)
Sabah has historically faced electricity supply constraints, particularly during peak demand and dry seasons. Renewable energy expansion and Sarawak import agreements are critical for addressing future demand.
Water Supply
- Urban Coverage: 100% of urban population
- Rural Coverage: 70% of rural population (30% gap remains)
- Challenge: Geography, dispersed settlements, and funding limit rural expansion
- Agency: Jabatan Air Sabah (Sabah Water Department) oversees supply
Water quality and reliability in rural areas remain priority issues for the state government.
Telecommunications
Sabah's digital infrastructure has improved significantly via the National Digital Network (Jendela) initiative launched in 2020.
| Technology | Coverage | Year | Notes |
|---|---|---|---|
| 4G (LTE) | 90.54% (populated areas) | Q3 2023 | Up from 73.41% (Q2 2020, pre-Jendela) |
| 5G | 68.9% (populated areas); 53.2% (state-wide) | Sept 2024 | 437 of 622 sites completed |
| Fixed-Line Broadband | 20.9 per 100 premises | 2021 | Lower than 4G due to geography |
| Mobile Broadband Penetration | 88 per 100 residents | 2021 | Strong mobile adoption |
Digital Divide: Rural connectivity remains a challenge; remote areas still face gaps in 4G and 5G reach. Government continues infrastructure rollout under SMJ 2.0 Digital Transformation pillar.
Planned Developments
The Sabah Maju Jaya (SMJ) 2.0 Development Plan (2026–2030) prioritizes infrastructure modernization:
- Pan Borneo Highway: Phase 1 completion (706 km, 35 packages) targeting 2026–2028
- KKIA Expansion: RM442.3 million Terminal 1 upgrade to 12 million passengers/year
- Sarawak–Sabah Link Road: Phase 1 expected Nov 2026; Phase 2 by mid-2029
- Port Upgrades: SBCP capacity expansion to 1.25 million TEUs; Sandakan and Tawau port improvements
- Renewable Energy: 199 MW solar projects + 100 MW gas plant + 30 MW Sarawak import
- 5G Rollout: Complete remaining 185 of 622 sites for statewide coverage
- Rural Connectivity: Extend broadband to underserved areas via Jendela Phase 2
Budget 2026 committed RM6.9 billion to Sabah infrastructure, emphasizing highways and connectivity as drivers of SMJ 2.0 economic growth targets.
Challenges
Infrastructure development in Sabah faces persistent structural headwinds:
- Geography: Mountainous terrain, river systems, and dispersed settlements increase construction costs and maintenance complexity.
- Funding Gaps: Despite federal support, state budget constraints limit parallel projects.
- Cabotage Policy: Coastal shipping restrictions increase logistics costs compared to Peninsular Malaysia.
- Rural Access: 30% of rural population lacks water supply; remote areas have weak digital connectivity.
- Maintenance: High rainfall and humidity accelerate road/infrastructure deterioration in tropical climate.
- Labor & Materials: Construction workforce shortages and high material costs on Borneo affect project timelines.
- Climate Risk: Monsoon seasons impact shipping, air travel, and road conditions; flooding in low-lying areas.
Success depends on sustained federal funding, private sector partnerships (like DP World at SBCP), and strategic prioritization of high-impact projects.