KUALA LUMPUR, Jan. 8 (Xinhua) — Economists and institutes are optimistic about the Johor-Singapore Special Economic Zone (SEZ), which was announced on Tuesday to boost investment between the participants.
Maybank Investment Bank said in a note that the SEZ is primed to drive construction, industrial property, data centers, and tech sectors, with secondary beneficiaries including residential, retail, and office properties and consumer sectors.
“Poised to be a regional economic powerhouse to take advantage of the strength of two strong ASEAN (the Association of Southeast Asian Nations) nations, the SEZ agreement marks a new era of investment opportunities. It also marks the leadership and commitment of the two countries, which form the foundation pillars of the SEZ,” said the research house.
MIDF Research also noted that it opined the SEZ has the potential to become a strategic hub due to its connectivity to both Johor and Singapore ports, which provide regional and global connectivity.
The research house further stated that the SEZ could have a trickle-down effect on the small and micro businesses in the region, as the population is expected to increase due to the pickup in business activities.
“The upgrading of technology will enhance the movement of people and goods, and the increase in clearance capacity will support the SEZ’s potential,” it added.
Hong Leong Investment Bank Research highlighted in a note on Wednesday that it views the finalization of the SEZ as a precursor to more catalytic developments, such as the urban mobility project.
The OCBC also identified some clear positives from the formalization of the SEZ. For instance, the division of the SEZ into different zones is prudent, considering the large size of the SEZ, and this will help develop synergies between similar industries and companies.
Given that the SEZ focuses on promoting high-skill industries such as the digital economy and financial services, the effort to build a strong, competent labor force could prove prescient, it added.
UOB Global Economics and Market Research also suggested that the SEZ will unlock value for investors through strategies and initiatives that enhance its competitiveness on the global stage amid challenges in talent, capital, the green economy and global trade fragmentation.
