Johor proposing Iskandar Malaysia be designated special economic zone with S'pore
KUALA LUMPUR – Johor’s state government has proposed that its business hub Iskandar Malaysia be designated as the special economic zone being planned between Singapore and Malaysia, The Straits Times has learnt.
It is not known if Malaysia’s federal government agrees and will discuss the proposal with Singapore. A memorandum of understanding on the Johor-Singapore Special Economic Zone (SEZ) is expected to be inked by both sides on Jan 11.
“The Iskandar development region is ready-made to be the SEZ,” said Mr Lee Ting Han, chairman of Johor’s state investment, trade and consumer affairs committee.
Iskandar, which was conceptualised as an economic growth corridor in 2006, includes Johor’s heavy industrial zone Pasir Gudang, its capital city Johor Bahru, Iskandar Puteri, Kulai, Sedenak and part of Pontian town.
It attracted foreign investments to the tune of RM153.4 billion ($44 billion) between 2006 and 2022. Singapore is the second-largest foreign investor in Iskandar after China, with RM33 billion committed as at June 2023.
Investment slowed in recent years due to pandemic border restrictions, contributing to a property glut. Total investments in Iskandar since its inception was forecast to reach more than RM400 billion in 2023, said Mr Lee.
“The Iskandar growth corridor would be a good start, as the area encompasses planned integrated development Ibrahim Technopolis at Sedenak town, the heavy industrial area at Pasir Gudang and the proposed special financial zone in Forest City,” he told The Straits Times.
The SEZ, which was officially announced in October 2023 during Malaysian Prime Minister Anwar Ibrahim’s visit to Singapore for the 10th Malaysia-Singapore Leaders’ retreat, is an integrated zone for business and investment that is aimed at easing the movement of people and goods across the border between the two countries.
Mr Lee told ST that Johor’s proposal has been submitted to the federal government’s Ministry of Economy, which is in charge of Malaysia’s economic development. But it is not known if the proposal will form part of the SEZ plans being discussed with Singapore.
According to an official source, Malaysia is hoping to attract nine sectors to the SEZ, including logistics and digital economy.
The definitive agreement with details of the SEZ, including its physical location, is expected to be signed in 2024 Q4, said Mr Lee.
On the face of it, both the Iskandar project and the upcoming SEZ have similar objectives and structures – they are both Singapore-Malaysia plans that aim to boost economic activity in the region. For example, ministers on both sides have discussed developments in Iskandar since 2007, when the Malaysia-Singapore Joint Ministerial Committee for Iskandar Malaysia (JMCIM) was set up.
Mr Lee said the JMCIM currently covers policy-based matters for immigration, industrial cooperation, tourism and environment between both countries, while the SEZ will be more focused on economic matters.
In particular, the SEZ is expected to ease movement of people and goods across the congested Singapore-Johor border.
Get The New Paper on your phone with the free TNP app. Download from the Apple App Store or Google Play Store now
