Iskandar the cheaper alternative to Singapore?

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#1
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Iskandar the cheaper alternative to Singapore?

When Singapore launched its plan for a global city of 6.5 million, it sounded like sweet music — rather than a business warning — to businessmen in Johor.

To the forward-looking, this strategy of a wealthy neighbour right next door, which is the 10th most expensive city in the world, spells potential spill-over for their economy.

At a friendly discussion in a hotel, several Malaysians told a Singaporean business consultant that they foresaw two possible scenarios, if Malaysia played its cards right.

That was just after the two governments had signed an agreement over the railway dispute and for future cooperation.

One Malaysian said: "Having a thriving global city next door would allow Malaysia — in particular Johor — to quickly tap onto global trade via Singapore."

Another speaker, a Malaysian researcher, offered this rationale:

"We can also benefit in another way. The Singaporeans are very good at earning foreign exchange — US dollars, Japanese yen and the euro, etc.

"We can earn some of these foreign earnings indirectly from Singaporeans. They are short of things that we have.

"All we need do is offer them a place to come and enjoy themselves."

How Johor could benefit

The feeling was that Singapore was already overcrowded and expensive and it lacked the space for business and fun — and this was where Johor could cash in.

It was nothing new, but the mood was.

It was partially this reasoning that led to the creation of a metropolis, Iskandar Malaysia, in the foothills of southern Malaysia, three times the size of Singapore island.

Last week, as the development pace gathered steam, I could not help but think about the impact it will have on Singapore's economic future.

These news items came within days of one another:

* A tender was opened up for the construction of the Singapore-Johor mass rapid transit or MRT to start operating in 2018.

* A Singaporean billionaire signed a S$2bil deal with the Johor royal family to build a 10ha medical hub and marina city bordering Singapore.

* Southeast Asia's first premium outlet centre will open next month in south Johor, just an hour's drive for Singapore's shopaholics, offering branded products with discounts.

The huge project will be built in stages and will include improved rail, sea and air connections to Singapore (24-hour access) and easier immigration clearance.

Nearly 50 years after their break-up, the two former siblings, who face a gloomy world in the coming year, are pushing the momentum of bilateral cooperation.

Malaysia knows it can benefit from Singapore's world trade links and experience, which date back to early history, to gain promotion to a higher league.

And Singaporeans, who live in the world's 10th most expensive city, can look forward to some relief in their high-cost living.

Actually, it may well bond the two to become more dependent on each other.

For the promised land to be reached, however, requires a few caveats: first, crime and corruption must be put under control and, second, political quarrelling does not upset the applecart.

Crucially important is that the race card is kept away.

Not much interest among Singaporeans?

Still, I am surprised that given the large potential to change lives, the Iskandar concept has stirred little interest among Singaporeans beyond shopping and entertainment at cheaper prices.

The general public, in fact, doesn't have much idea about it. In fact, people here tend to underestimate its potential impact on the future of this trading state.

To the business community, however, Iskandar both serves as a potential partner as well as a strong rival.

It will likely add to the number of rival economies in Asia that are on the verge of overtaking — or have already overtaken — Singapore.

They range from new giants like China and India to smaller developing countries which are aggressively pushing for growth like Indonesia, Malaysia and Vietnam.

Iskandar, for example, is hell bent on attracting foreign investors and establishing a healthcare and an education hub, areas that the republic has been pursuing.

Rivalry aside, the existence of a large metropolis could be a blessing in disguise to help Singapore's dilemma of income inequality.

As more wealthy foreigners settle on this island and pushing prices, the bottom 30 per cent of the poorer class gets increasingly squeezed.

They desperately need a cheaper source of daily living that Johor can provide.

Most important is insufficient and spiralling home prices. Thousands of Singaporeans — with families in tow — who find it hard to cope are buying homes in Johor and commuting daily to Singapore.

It is beginning to resemble the picture of Hong Kong residents buying Shenzhen properties.

For the displaced Singaporeans, it is not only cheaper housing but a whole less expensive life — if they are prepared to settle for the longer commuting.

More and more are celebrating marriage and birthdays in Johor restaurants. Others get their surgeries done, buy their medicine and change their car tyres in the future metropolis — all for much less.

Steadily the list of products and services lengthens. The savings are not to be sniffed at.

Indirectly, larger-size Johor is helping to look after Singapore's citizens. A former health minister even suggested building retiree homes for Singaporeans there.

These are nudging the two peoples closer together without talking politics. Last week, surfer Koh Lian Tye asked: "Forty-six years on, was quitting Malaysia a mistake?

"I am a proud Singaporean, but I also believe that in being part of Malaysia as an autonomous region we could have benefited.

A former Reuters correspondent and newspaper editor, the writer is now a freelance columnist writing on general trends in Singapore. This post first appeared on his blog www.littlespeck.com on 19 November 2011.
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#2
I think a lot of the shopping and services in JB is built for singaporean tourism who go in on weekends for day trips or partying scene very little of it is for their local people.

If you go to city square or jusco or the newer malls a lot of the shops you find there you will also find here in SG and I noticed the prices of many of the merchandise is no longer cheap after conversion it could be about the same or cost even more.

On the investment vein the problem I feel in malaysia jb especially there is "too much land" and lack of proper urban planning, such that there's too much condo projects in JB too many shopping centers (some of these shopping malls are deserted like dangar city IT mall) and they all also trying to attract SG to come to buy.

Part of the reason of the lack of proper urban planning is that all land that is raw and undeveloped actually belongs to the sultanate so I think unless sultan is getting some benefit your project will make very little headway.

So the last time they built the mega project Dairy farm that was 10 years ago to attract SG investors, now they will build the Iskandar maybe another 20 years something else again but all on the assumption that many singaporean will come to buy and shop and spend but if not enough singaporean are not biting ... Tongue
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#3
My view is that current political risk in Msia is high. Better to see what happen after their election....
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#4
It is not just the political risk. Look at the track record of the msian gov in some of their (wasteful) projects:

(1) Port Klang Free Zone (Estimated costs balloon from RM2bil to 8bil)
(2) Putra Jaya (leaked after 1 year)
(3) KL International Airport - MAS (now merging with AirAsia and has to sell land around the airport to break even)
(4) The Proton (saga)
(5) Bukit Jalil - white elephant stadium
(6) Sultan Iskandar CIQ - Just few years after it opened officially boasting state of the art facilities, the train service between Spore n Msia is terminated!! :O
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#5
If more and more Sporean start to stay in JB and travel to Spore to work i wonder what is the use of national service. Might as well serve NS and defend JB.
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#6
lolz! Big Grin if u put it in a strict context... singapore was part of malaya... until we got booted out! Tongue

i do hope that the security will improve in JB/Iskandar, so that we can go shopping/eating in JB more often! Big Grin
1) Try NOT to LOSE money!
2) Do NOT SELL in BEAR, BUY-BUY-BUY! invest in managements/companies that does the same!
3) CASH in hand is KING in BEAR! 
4) In BULL, SELL-SELL-SELL! 
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#7
Having worked in sgp/msia for a good number of years and gaining ample knowledge on how the country works....

Summary

Iskandar Region, the idea = 10/10
Execution= 1/10
Basic utilities/public administration/legislation framework = 1/10

But Kudos for the idea.
However, a brilliant idea is worth nothing if it is executed poorly
or lack basic infrastructure/basic resources to support it.

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#8
Pretty sure the food over at JB would be cheaper somehow and taste far much better than Singapore though.
Nowadays hawker and foodcourt food sucks.

Laska = La Jiao Mian.
Saw a PRC ordering this from the PRC laska stall tdy. Well done..
So much for govt push for Food is Singapore's heart and soul, where citizens are supposed to be endeared to so as not to consider migration.

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#9
It is good to have a place where we can feel we are FT, something which is lacking in our own country.
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#10
I also think the hawker food here is quite bad... especially fish ball soup...
Feel that these hawkers are just too lazy to prepare a decent meal.
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