The year 2011 marks the beginning of an important phase for Iskandar Malaysia. The focus on the next few years will be to follow through and to see full completion of the early projects.
While the first three years after Iskandar Malaysia’s launch in November 2006 were devoted towards courting investors and introducing basic infrastructure, the corridor is now entering its all-important second phase. Projects like LEGOLAND, the Premium Outlets, EduCity and the Danga Bay Waterfront Development are expected to accelerate towards completion in 2012.
Despite having their hands full with such responsibilities, organisations involved in Iskandar Malaysia have to persevere in promoting the megaproject to potential overseas investors. One of these organisations is the Iskandar Regional Development Authority (Irda), which is the regulatory body tasked with planning, promoting and facilitating Iskandar Malaysia’s development.
Like many large developments, it has not been smooth sailing all the way for Iskandar Malaysia, which has seen its fair share of external challenges. The uncertain global economy, for one, has driven Irda to strive harder in its efforts.
Maintaining Investment Momentum
Irda chief executive officer Ismail Ibrahim is mindful of the challenges ahead, one of which, he says, is the growing competition from the Asia Pacific region.
“There is the need to come out with more programmes to attract investments from China, India, Indonesia and Singapore. Irda will also continue to work closely with the Malaysian Industrial Development Authority (MIDA) and the Malaysia External Trade Development Corporation, as they have done in the past,” he says.
More personal and one-on-one outreach programmes will be held in the months to come to maintain the momentum of private sector investments. Irda will also be targeting more impactful promotions and marketing activities.
Ismail adds that Irda will intensify its involvement in events similar to those which it attended in the past such as Cityscape Abu Dhabi and Cityscape Asia. Both events attracted regional and international investors, property developers, government and development authorities, consultants and other professionals in the property sector.
Ismail, who is the former Director of the Physical Planning Division of the Rural and Town Planning Department, is confident that Irda would continue to make a difference in Iskandar Malaysia’s future.
“We provide consultation and information on investing in Iskandar Malaysia and act as the principal coordinating agent on behalf of relevant government agencies in relation to receiving, processing and expediting the requisite approvals for investors in Iskandar Malaysia. Irda also extends assistance to existing investors in the resolution of issues affecting their business environment,” Ismail reportedly said recently.
Strong Govt Support
These thoughts echo the sentiments of Prime Minister Datuk Seri Mohd Najib Tun Razak, who earlier this year pledged that in the interests of international trade, the country would continue to strengthen ties with East Asian nations, particularly China and India, in light of the increasing competition in the region.
Najib, who is co-chairman of Irda together with Johor Menteri Besar Datuk Abdul Ghani Othman, said efforts should also be made to initiate inroads into Europe.
Another challenge lies in the perception of Singaporeans towards Iskandar Malaysia. A long-running issue which Singapore nationals have is the safety and security in Johor, which they say is notorious for robberies.
To alleviate the problem, Irda launched a special task force in charge of eradicating crime and introduced a Safety and Security Blueprint which was implemented throughout Iskandar Malaysia.
As a result of these measures and the diligent Johor state police force, the state recorded a drop in the crime index.
Despite the challenges and judging from 2008-2009 where, despite the global economic recession, economic and development activities continued in Iskandar Malaysia, the outlook is positive for the development corridor.
In a recent report by the Malaysian Institute of Economic Research (MIER), domestic growth for 2011 is expected to be in the region of 5.2 per cent. The latest statistics for Iskandar Malaysia show that investments reached RM68 billion in November 2010. Some 58 per cent, or RM39.44 billion of the investments were domestic, while the remainder came from foreign investors.
The report adds that external challenges, however, will come in the form of instability in the US and European economies which may affect the road to recovery.
Despite all this, investors can rest assure that Iskandar Malaysia will continue to prosper as it receives strong support from the Najib administration.
At the 9th meeting of the Members of Authority (MoA) of Irda which Najib chaired in December 2010, the MoA noted that despite the global economic slowdown, Iskandar Malaysia continued to attract interest from investors.
This was due to the corridor’s strategic location, strong brand, competitive cost of doing business, transparency and good investment environment.
Among the significant foreign investors are the Singaporeans, particularly in the manufacturing and services sectors.