The Brunei Darussalam economy slowed down in 2018 but is expected to pick up in 2019, while inflation will likely continue to rise moderately. The major risks facing the Brunei Darussalam economy are mainly from domestic factors as a result of its high reliance on the oil and gas sector. While the government has enhanced its efforts to develop other industries, the role of the oil and gas sector in GDP growth, exports and fiscal revenue remain high. On the external side, the risk mainly stems from the possibility of a sharp decline in global oil and gas prices, while other risks such as escalating global trade tensions and a sharp tightening of global financial conditions are expected to have a small impact on the economy. Policy efforts on structural reforms and to diversify the economy away from the oil and gas sector into manufacturing, tourism, agriculture, aquaculture and other non-traditional industries should be continued to enhance Brunei Darussalam’s long-term growth prospects.