Sabah’s Rural Development Ministry has come under scrutiny after opposition leader Datuk Seri Mohd Shafie Apdal accused it of weak enforcement in dealing with the long-running issue of so-called “Ali Baba” business practices — where foreigners operate local businesses under the names of Malaysian proxies.

The accusation after suspicions were publicly raised by a Federal Minister about possible collusion between foreign business operators and district councils, particularly in Semporna. 

Despite that, enforcement action has yet to be initiated.

Shafie said the ministry’s apparent reliance on opposition lawmakers to provide evidence signalled complacency and a failure of oversight.

“If we already hear these concerns, go to the ground. Investigate whether it’s true or not. It’s impossible this is only happening in Semporna — it’s everywhere in Sabah,” he told the house during the question and answer session on Wednesday. 

“Enforcement of law is very weak here. You depend on us to work with you — but it is your responsibility to take action,” he added. 

The Rural Development Ministry, led by Assistant Minister Datuk Seri Ruddy Awah, maintained that no business licences had been issued to foreign nationals and said any claims of misuse must first be backed by data before action could be taken.

He further noted at this point there’s no reason to carry out an investigation or action. 

“If you have the data, send it to me. Call me — I will turun padang to your area and meet with the district office. 

“We are not siding with those who commit wrongdoing, but we must act based on facts,” he said. 

The “Ali Baba” issue was first raised during the session by Bugaya assemblyman Jamil Hamzah, who asked what action the state had taken following allegations that business licensing processes may have been compromised.  

He noted the matter was also raised by Tourism, Arts and Culture Minister Datuk Seri Tiong King Sing recently. 

Jamil also suggested the state rotate officers stationed in high-risk areas and increase joint enforcement operations across tourism zones.

Ruddy acknowledged the concerns but insisted that no complaints or directives had been received from federal authorities, including the Ministry of Tourism. 

“This is important. We need to act together,” he said, offering to personally investigate any cases raised by local representatives.

Shafie, however, said the government should not wait to be handed information and should instead initiate its own investigations. 

He said he had already contacted the Home Ministry and Immigration Department about such activities, some of which he believes are widespread.

“Ask who’s really paying the salaries of workers in these businesses. The names on the licences are locals, but the control lies with others.

“You can’t claim to be serious about enforcement if you’re waiting for people to bring everything to you.”

While Ruddy offered to go to the ground if data is provided, Shafie’s remarks appeared to reflect a broader frustration over what he sees as a reactive rather than proactive approach from the state.

“This is not just about speaking in this honourable House. I will go to the ground. That is my promise to the Bugaya assemblyman,” Ruddy said in closing. – April 16, 2025