Down the Corridor

What contributions has Iskandar Malaysia made to the development of Johor and Malaysia to date?

Johor has always been a modern and bustling city of economic activities and trade. Throughout history, it has been a gateway to both international trade and cultural exchange, and at the forefront of Malaysia’s social, political and economic development. Iskandar Malaysia is a continuation of Johor’s history of being at the forefront of change. With the existing strategic location, talent pool, and economic potential, Iskandar Malaysia was developed to fully tap the potential of Southern Johor. The approaches adopted must be aimed at attracting more talent and investment into the region. This would generate a concentration of businesses and people, forming a network that facilitates the free flow of ideas, innovation, and creativity to drive Iskandar Malaysia’s economy. The development of livable communities that attract people to “live, work, and play” is an important factor that will influence further investments into Iskandar Malaysia. With the rise of urban conurbations throughout the world, this competition for funds and talent is a competition between large metropolitan areas, anchored by a city where economic activities are focused. Examples include the Greater Tokyo area, the world’s largest urban conurbation, and, closer to home, Greater Kuala Lumpur. At the end of 2025, when Iskandar Malaysia reaches maturity, it is expected to have a population of three million people, 1.46 million jobs, cumulative investments of RM383 billion over the 20 years, and a GDP of $93.3 billion. We are well on our way to achieving this. The people are already experiencing the positive changes, such as increases in quality of life, education options, employment opportunities, and better infrastructure.

The Prime Minister recently approved the 2014-2025 Comprehensive Development Plan for Iskandar Malaysia. What are the main elements of this?

When the Iskandar Malaysia’s Comprehensive Development Plan 2006-2025 (CDP) was drawn up and published in 2006, it had taken into consideration the development needs then and also pre-empted future requirements and concerns that are expected to arise due to the rapid development taking place. It consists of three domains, namely sustainability in the economic, social, and environmental context. In the enhanced Comprehensive Development Plan 2014-2025 (CDPii), we ensure that Iskandar Malaysia continues to be developed as a holistic eco-system. Wealth generation, resource optimization and low carbon, and wealth sharing and inclusiveness are the three main elements in developing the region. Wealth generation ensures a continuous, stable, and resilient income generation through regional economic growth resulting from high-skilled employment, higher productivity, and value creation. Yet, as this takes place, we have to ensure that natural and man-made resources are protected through their optimal use and smart growth. Alongside that, and if not most importantly, the Rakyat must be given the opportunity to participate in the wealth generation, indirectly contributing to regional and individual wealth. In the CDPii, five big moves have been identified to lead Iskandar Malaysia toward becoming a sustainable metropolis of international standing and they are Inclusive Iskandar Malaysia, Greening Iskandar Malaysia, Destination Iskandar Malaysia, Port Iskandar Malaysia, and Iskandar Malaysia Urban Observatory. These moves take into consideration all the blueprint strategies, programs, and initiatives, including the voices of communities that were obtained through public engagements with non-governmental organizations (NGOs), local communities, the government, and private agencies.

What role do public-private partnerships (PPPs) play in the development of Iskandar?

PPP projects are encouraged in Iskandar Malaysia to further stimulate and encourage private sector investments in development projects. Iskandar Malaysia is still growing and further enhancement and upgrading of infrastructure and services are key priorities to sustain the region’s growth trajectory. An important aspect of PPP projects is good planning as this ensures that there is value for money, risk is shared equitably between the government and private sectors, and problems in implementation and operations are avoided. Well-planned projects ensure success and smooth delivery by the private sector. The fundamental pre-requisite for any PPP partnership is the sustainability of the project and its impact on the growth of a country. Some examples of PPP models that can be used are user-pay models such as build-operate-transfer (BOT) and land swap arrangements that are fair and equitable. To expedite the implementation of PPP projects to meet the critical need for infrastructure development, the government needs to play a more proactive role in identifying bankable PPP projects and offering them out to the private sector. Based on international best practices, this can be done in a competitive environment to bring out the most value-for-money and innovative PPP proposal. To this effect, IRDA is currently working closely with several agencies such as the Public Private Partnership Unit (UKAS) under the Prime Minister’s Department, the Johor Economic Planning Unit, and local authorities to identify and implement bankable PPP initiatives, with several projects already in the pipeline. PPP has proven to be a viable method for the government to deliver public infrastructure and services in Iskandar Malaysia. Therefore, we hope that more PPP projects can be conceptualized, planned, and implemented in Iskandar Malaysia to set new benchmarks and standards toward global recognition. IRDA welcomes from the private sector any new innovative proposals in PPP that are sustainable and provide win-win solutions.

© The Business Year – June 2015