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Labuan (Jawi: لابوان) is the main island of the Malaysian Federal Territory of Labuan. Labuan is best known as an offshore financial centre and a tourist destination for nearby Bruneians and scuba divers. The name Labuan derives from the Malay word labuhan meaning anchorage.
Geography The Federal Territory comprises Labuan Island (75 km²) and six other smaller islands (Pulau Burung, Pulau Daat, Pulau Kuraman, Pulau Papan, Pulau Rusukan Kecil, and Pulau Rusukan Besar) that, together with Labuan, have an area of 92 km². The islands lie 8 km off the coast of Borneo adjacent to the Malaysian state of Sabah and the independent State of Brunei Darussalam and are on the northern edge of Brunei Bay facing the South China Sea. Labuan is mainly flat and undulating and the highest point is only 85 metres. More than 70 percent of the island is still covered with vegetation. Bandar Labuan, formerly known as Victoria, is the major town and port and faces Brunei Bay. History Labuan was a part of the Hindu Majapahit Empire and, in the 14th century, came under the rule of the Brunei Sultanate. In 1840 the British used the previously-uninhabited island as a base for operations against piracy and later as a station for the submarine cable between Singapore and Hong Kong. The Sultan of Brunei ceded Labuan to Britain in 1846, and the island became a Crown Colony in 1848. It was made a part of North Borneo on 1 January 1890, then on 30 October 1906 joined to the Straits Settlements. The first White Rajah of Sarawak, James Brooke was appointed commander-in-chief and Governor of the new territory. During World War II, Labuan was occupied by Japan from December 1941 to June 1945 and governed as part of the Northern Borneo military unit by the Japanese 37th Army. Labuan was renamed Maida Island (Pulau Maida, 前田島 ''Maeda-shima'') after Marquis Toshinari Maeda, the first commander of Japanese forces in northern Borneo. The island was retaken by Australian forces in the Borneo Campaign of 1945. Labuan assumed its former name and was under British military administration (along with the rest of the Straits Settlements), then joined to British North Borneo, on 15 July 1946, which in turn became a part of Malaysia as the state of Sabah in 1963. In 1984, Labuan was ceded by Sabah to the federal government and made a federal territory. In 1990, it was declared an international offshore financial centre and free trade zone. Economy The Malaysian government's attempts to turn Labuan into an international banking centre has had only limited success, but the government still offers incentives to try to lure in new investors. With land utilization geared more towards property and industrial use, there is little agricultural activity. Most of the island's prime land, waterfront and suburbs are utilised for residential and tourism development. A sizeable area on the southwestern side of the island is occupied by shipbuilding, manufacturing and oil and gas industries. Within recent decades Labuan has undergone significant improvements in infrastructure and services. Population The population of 78,000 (est. 2000) is mostly Malay, with minorities of Chinese, Kedayans, Filipinos, Indians, Bugis, Bajau and Expatriates. Politics Labuan would have joined the North Borneo Federation if it had materialised during the 1960s. During the late 1990s certain sections of the population raised the issue of independence from the Malaysian Federation, or at least greater autonomy or devolved government. This view was opposed by those who believe that independence is not economically viable and state that many services and industries depend on large government subsidies, such as Labuan Shipyard. Advocates of independence state the success of small countries such as neighbouring Brunei as proof that Labuan could function as a separate state. The majority of the population are generally content with the current political situation. Defence Defence is the responsibility of the federal government, with naval patrol vessels, a garrison and an air detachment based on the island. The local Police Force maintains everyday law and order. The Coast Guard and Customs and Exercise have a relatively strong presence on Labuan, due to the nature of its economic status as a Federal Territory, international offshore financial centre and free trade zone. Attractions and places of interest There are several attractions and places of interest on Labuan. The military cemetery contains various war graves and memorials to the fallen of The Second World War. This includes British, Australian, Indian, Sarawaki, Bruneian, North Borneo and Empire troops. There is also a memorial celebrating the surrender of the Japanese to the Australian Forces in 1945. There are also remnants of Labuan's history as a Royal Navy Coaling station, including 'the chimney', a well known local landmark. Postage stamps and postal history
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