New joint SEZ plan can bring another economic peak, say groups
PETALING JAYA: The implementation of the Kuala Lumpur-Singapore High-Speed Rail (HSR) should be expedited following the agreement between both countries to jointly develop a special economic zone (SEZ) in Johor, say stakeholders.
Malaysian business chambers and small and medium enterprises (SMEs) said the move is expected to create high-value jobs and generate business opportunities of varying scales.
SME Association president Ding Hong Sing said that establishing the SEZ could bring about another economic peak for both Malaysia and Singapore.
He highlighted the complementary strengths, with Singapore possessing technology and talent, while Malaysia has ample land and human resources, creating a win-win situation.
“We hope that Malaysia and Singapore can resume negotiations on the HSR, benefiting the people of both countries through reciprocal travel.
“Railway construction can boost the surrounding economy, providing significant economic benefits for SMEs,” he added.
The SEZ signed by the leaders of both countries on Thursday was aimed at developing a comprehensive pact, focusing on cooperation in streamlining procedures, from business approvals to border clearance.
Ding emphasised the importance of simplifying and expediting all commercial clearance procedures, as this would enhance business activities, considering that time is money.
He expressed hopes that the government would assist SMEs in avoiding unnecessary bureaucracy.
Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) SMEs committee chairman Datuk Koong Lin Loong said the ACCCIM and Singapore Chinese Chamber of Commerce & Industry had established a Joint Steering Committee for Cooperation and Consultation on Jan 2.
He said the objective is to help member companies from both countries leverage their strengths for mutual business development and growth.
“We welcome the SEZ, and any Singaporean companies setting up factories and hiring in Malaysia will receive assistance from the chambers.
“We hope Singaporean companies can provide technology transfer and talent training, relocating their factories to Johor,” he added.
He said Malaysia offers better business conditions due to the current surge in operating costs faced by Singaporean manufacturers.
He said after Singaporean companies relocate their factories to Malaysia, Malaysians need not cross the border to Singapore for work.
He said this would provide an opportunity for Singaporean companies to remain in the country.
The chamber anticipates that the reopening of negotiations for the HSR will not only boost the economy of the southern Malaysian state, but also stimulate economic growth up to Selangor.
Malay Chambers of Commerce Malaysia (MCCM) president Norsyahrin Hamidon hopes that the SEZ will attract more foreign investment to Malaysia, especially in technology transfer, which would be beneficial for the Malaysian economy.
“Given the close relationship between Malaysia and Singapore, if the two countries are willing to further promote the economic special zone, it will create more business opportunities for Malaysian enterprises and businesses.
“We believe the national leaders will continue to attract more foreign investments for the country’s economy,” Norsyahrin added.
He emphasised the need for both countries to promptly restart negotiations on the HSR, adding that political factors should not hinder the economic progress of the nation.
An MOU was signed on Thursday between both countries to develop a framework for a legally binding agreement on the SEZ.
Under the MOU, Malaysia and Singapore will work towards enhancing cross-border flows of goods and people as well as strengthening the business ecosystem to support investments.
Singapore was Johor’s second largest foreign investor from January to June 2022 and contributed around 70% of the state’s total foreign direct investment in the manufacturing sector.
There have been recent reports about plans to revive the HSR project, which was cancelled by the Federal Government in 2021, with Malaysia paying RM320mil in compensation to Singapore.
