Malaysia in $105b plan to transform cinderella city
04 Nov 2006 05:54:48 GMT Source: Reuters
(Adds details in paragraphs 7 and 20) By Mark Bendeich JOHOR BARU, Malaysia, Nov 4 (Reuters) - Malaysia unveiled a $105 billion blueprint on Saturday to turn the area around its second-largest city into a prosperous Asian metropolis, determined to overcome its reputation for street crime and broken dreams. Prime Minister Abdullah Ahmad Badawi, keen to boost a slowing economy and his own political support, said the government would set up a central planning body to oversee 20 years worth of projects to transform Johor Baru and its surrounds. "We mean business," he told a crowd on city's foreshore, overlooking the island state of Singapore, whose rapid economic success over 30 years has mocked Johor Baru's failed ambitions. "Our vision is to make south Johor the new international address for business, investment, leisure and culture." The 2,200-square kilometre development area is to boast a high-tech park, logistics and industrial precincts, educational park, regional hospitals, marina, waterside villas, theme parks and exclusive, gated residential communities. The government will also create free access zones in certain areas in Johor where visitors from Singapore can live and work. There will be no immigration and customs check for entry into these zones which will be guarded by surveillance systems and barriers. Abdullah said investment of $13 billion would be needed in the first five years from 2006-2010 to build roads, rail and other infrastructure required to set the stage for an influx of private investment, which is expected to come largely from Singapore. The government estimates $105 billion of investment will be required over 20 years to meet the projected growth target of 8 percent per annum for the region. Johor Baru is home to about 1 million people on the southern tip of the Malaysian peninsula, on the doorstep of one of Asia's richest financial capitals, but poor relations between the two countries have left the two cities estranged. Abdullah's ambitious project to capitalise on synergies with Singapore stands in stark contrast to that of his predecessor, former prime minister Mahathir Mohamad, who had testy ties with Singapore's leaders and who has ripped Badawi over his stance toward the city-state to the south. Singapore is hungry for more land but instead of relocating industry to lower-cost Johor Baru it has focused on aggressive land-reclamation and invested heavily in manufacturing and resorts on nearby Indonesian islands. POLITICAL JINX "I think a lot lies on how the Malaysian government tackles the Singapore factor," said Wan Abdullah Wan Ibrahim, managing director of UEM Land, which owns the single largest slice of property in the south Johor development zone. "Somehow along the way, they will just have to learn to work together for mutual benefit," he told reporters in a briefing held on the eve of the premier's announcement. UEM Land owns Nusajaya, a parcel of vacant and developed land covering almost 24,000 acres (9,700 hectares) southwest of Johor Baru. It was first put forward as a development mecca for foreign investors in the early 1990s, but the project failed to take off. Wan Abdullah blamed the 1997-98 Asian financial crisis for Nusajaya's initial failure but said political tensions, red tape and concerns about crime in Johor Baru had also played a part. "I think, for once, we have got all these things addressed," he said, referring to the government's new master plan. The government plans to spend 330 million ringgit ($90.5 million) on security in the area over the next five years, including closed-circuit TV systems, extra police and communications equipment. Malaysia denies crime is rampant, but officials admit that visitors, especially Singaporeans, are concerned about theft and violent crime. Politics, though, may be a bigger challenge for the development. Mainly Muslim Malaysia and Singapore, predominantly ethnic Chinese, have been at odds since Singapore quit the Malaysian federation in 1965 in a racially charged separation. Johor Baru's political elite has been particularly wary of Singapore. As if to underline the city's wariness of foreigners, the sultan of Johor state joked in a rambling speech at the launch ceremony: "Many think that Mat Sallehs (Westerners) are great but I think Mat Sallehs are dirty." But a local ruling-party MP said it was time to suppress this instinct and welcome more Singaporean investment. "The best way for us to get early results is to look at what we can do to complement Singapore," said Nur Jazlan Mohamed, who belongs to the United Malays National Organisation, which has ruled Malaysia since independence from Britain in 1957. ($1=3.6455 ringgit)
