Johor moots making Special Financial Zone a part of JS-SEZ

JOHOR BARU: Johor has proposed making the Forest City Special Financial Zone (SFZ) a part of the Johor-Singapore Special Economic Zone (JS-SEZ).

State investment, trade, consumer affairs and human resources committee chairman Lee Ting Han said the matter had been discussed internally and would be brought up for discussion in the JS-SEZ working group.

He said that based on the Forest City master plan launched in 2016, the area was to be developed as an integrated zone for medical, tourism, education and real estate ventures.

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“Back then, there was a plan to turn Pulau Satu (in Forest City) into a duty-free zone.

“With assistance from the Federal Government, we obtained an amendment to make Pulau Satu a duty-free island.

“The announcement on the SFZ was made by Prime Minister Datuk Seri Anwar Ibrahim about a year ago and work has been ongoing since then,” he said in a statement on Monday (Aug 12).

He noted that Forest City was chosen for the SFZ because of its strategic location and proximity to Singapore, an international financial and logistics hub.

“As such, one more sector has been added to the Forest City development, the financial sector, in line with existing infrastructure… it is one of the reasons the SFZ was proposed in Forest City.

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“Our focus is to help investors enter the SFZ and to do that, we have to strengthen our talents and connectivity,” he added.

Most of Johor’s financial industry was still conventional so the state government was committed to enhancing the economic landscape by involving more modern banking systems to enable the state to complement Singapore’s financial industry, he said.

“We expect to hear more announcements about incentives for the SFZ by the end of the month, before the signing of a definitive agreement on the JS-SEZ between Malaysia and Singapore.

“We have also proposed for the Forest City SFZ to be part of the JS-SEZ initiative so that (it can also enjoy) incentives announced for the special economic zone.

“It will make the cooperation between both sides more formal and allow Malaysia to work on more concrete collaborations with Singapore in the future,” he said.

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Lee added that since SFZ was announced, financial companies including foreign and domestic banks had enquired about the incentives and special products they could offer

He said the state wanted interested parties to use Forest City as a launch platform for their products and tap into the international market.

“Once the announcements are made, the financial industry players will probably want to invest in the SFZ immediately,” he said.

The JS-SEZ will be located in the Iskandar Malaysia region in Johor, covering an area of more than 3,000 sq km, approximately four times the size of Singapore.

Malaysia and Singapore signed a memorandum of understanding on Jan 11 to work on developing the JS-SEZ to strengthen economic connectivity between Johor and Singapore.

Among the targeted sectors are electronics, financial services, business-related services and healthcare.

Following that, a committee jointly led by Malaysia’s Economy Ministry and Singapore’s Trade and Industry Ministry was established to formulate a definitive JS-SEZ agreement towards the end of the year.