Livelihood assets have been widely recognized in the recent development literature to
have positive consequences on poverty eradication. However, most studies examine
the impact of individual livelihood asset on some narrow indicators of well-being.
Therefore, it does not really shed light on whether overall livelihood assets are
associated with better well-being. This gives rise to the question on whether Sustainable
Livelihood Approach (SLA) also leads to poverty eradication. This paper attempts to
fill this gap by extending the analysis not only on the impact of six livelihood assets
(human capital, natural capital, physical capital, financial capital, social capital and
information capital), vulnerability and institutions on poverty, but also to estimate the
poverty gap, income gap and time exit poverty for the Rungus people, in Malaysia
state of Sabah. Empirical evidence on the links between livelihood assets and poverty
is provided by performing logit model. The analysis is carried out using primary data
obtained from a survey of 327 Rungus rural households in Kudat, Kota Marudu and
Pitas, northern most part of Sabah. The results show that all livelihood assets have
a positive significant impact to exit poverty except for vulnerability. The estimation
of time needed for the Rungus to exit poverty was 9.78 years with constant yearly
financial growth. These results imply that investment in information capital is crucial
to achieve poverty eradication objectives.