History
Northern Borneo was a coast of fishing and trading communities, loosely held by the sultanates of Brunei in the west and Sulu in the east, while the Kadazan-Dusun and Murut peoples farmed rice and hunted in the interior. In 1878 the Sultan of Sulu signed an agreement over his territories there with Western merchants, read by the Philippines as a lease and by Malaysia as a cession, and in 1881 the British North Borneo Chartered Company took over the administration, later making Sandakan its capital and opening tobacco and later rubber estates worked by Chinese and other migrant labour. Local resistance, notably Mat Salleh's revolt in the 1890s, was put down.
Labuan island was ceded to Britain by Brunei in 1846 and became a coaling station for steamers. The Second World War brought Japanese occupation and the Sandakan death marches of 1945, in which almost all the Australian and British prisoners held at Sandakan died. The war left Sandakan and Jesselton largely destroyed, and North Borneo became a British crown colony in 1946, with the capital moved to Jesselton, renamed Kota Kinabalu in 1967.
Sabah joined Malaysia in 1963 under the Malaysia Agreement, which promised certain autonomies, including immigration control, that remain a political issue today. The Philippines retains a dormant claim to eastern Sabah based on the 1878 agreement, which Malaysia regards as a non-issue; in 2013 armed followers of a Sulu claimant landed at Lahad Datu and were driven out. Labuan was transferred to the federal government in 1984 and became an offshore financial centre.
