THE recently unveiled Malaysia Vision Valley adds to the handful of ambitious investment corridors in the country. But how successful have the other five key economic corridors been?
The five are Iskandar Malaysia, the East Coast Economic Region (ECER), the Northern Corridor Economic Region (NCER), the Sabah Development Corridor (SDC) and the Sarawak Corridor of Renewable Energy (Score).
These corridors act as platforms in promoting free trade and business incentives located in strategic investment regions. They have distinct locations, their own visions and focus areas and respective bodies overseeing their development.
The economic corridors were created to bridge development imbalances in the country.
When Iskandar Malaysia was first introduced in 2006, there was scepticism due to the lacklustre performance of the Johor economy and the lack of progress on the ground level to speak of.
The first of its kind, Iskandar Malaysia was allocated RM6.83bil by the government and a vast acreage. It is the largest single development project ever to be undertaken in the region.
But about six years later, the Coastal Highway and Eastern Dispersal Link were introduced to aid connectivity. Following that, two major theme parks were opened, namely Legoland Malaysia and Puteri Harbour Family Theme Park, well known for its Sanrio Hello Kitty Town.
The education hub EduCity kickstarted with Newcastle University, the University of Southampton and Marlborough College.
As a result of these developments, many property projects reported strong sales, reflecting strong retail demand. Local and foreign property developers were in stiff competition in grabbing prime plots of land throughout the economic zone.
The massive interest in Iskandar Malaysia is also due to the highly-publicised high-speed rail project linking Singapore, Iskandar Malaysia and Kuala Lumpur.
However, the property euphoria has dimmed since the property cooling measures were introduced in 2014.
Nevertheless, Iskandar Malaysia had recorded a total cumulative investment of RM221bil as of last year, well above the initial targeted figure of RM141bil.
About 702,000 jobs have been created in various economic sectors, including the services sector such as logistics, creative, tourism and education.
The East Coast Economic Region (ECER)
The ECER encompasses Kelantan, Terengganu and Pahang as well as the district of Mersing in Johor, covering a total area of 66,000 sq km.
The ECER’s population of about 3.9 million represents 14.5% of the total population of Malaysia.
Since the ECER’s inception in 2008, private investments have totalled over RM102bil to date, which is a 14-fold return on the government’s investment of RM7.2bil.
And the ECER expects private investments to reach RM110bil this year, a target actually set for 2020.
Infrastructure-ready industrial parks in the ECER and investor-friendly incentives are also major pull factors for investors as they can start their operations immediately while enjoying many perks, including a 10-year tax holiday.
Among the industrial parks in the ECER are the Malaysia-China Kuantan Industrial Park, the Pekan Automotive Park and the Kuantan Integrated Industrial Park in Pahang; the Kerteh Biopolymer Park in Terengganu and the Pasir Mas Halal Park in Kelantan, with the main sectors comprising manufacturing, bio-economy, oil and gas, tourism, logistics and transportation.
The Northern Corridor Economic Region (NCER)
The Northern Corridor Implementation Authority (NCIA) was established to provide direction and devise policies and strategies in relation to socio-economic development, which encompasses 25 districts in the states of Kedah, Perak, Perlis and Penang.
It recorded RM8.3bil in private-sector investments and created 12,376 jobs last year.
The NCIA is targeting to hit RM7.4bil in private investments this year, along with the goal of creating 7,400 jobs.
The NCIA anticipates spin-off investments to be generated from new growth nodes such as Chuping Valley, the Kedah Rubber City, the Kedah Science and Technology Park and Greater Kamunting. The expectations are part of its new targets set under the NCER Socioeconomic Blueprint 2016-2025 – which will involve over 800 initiatives across three categories: localised high impact (45 projects), transcending borders (27) and touch-point projects.
Touch-point projects include the solar panel-driven SuriaKu initiative – soon to be rolled out nationwide as MySuria – the Estate Management Model for farmers, the Community Innovation Centre, the Bumiputra Micropreneur Development Programme (MCash), the Modern Farming Training Programme using Fertigation, Nestle Paddy Club, and Rapid Kamunting.
The Sabah Development Corridor (SDC)
The SDC is an economic corridor initiative that spans the state of Sabah.
Leveraging on its natural endowment as well as locational advantage to generate economic growth while ensuring optimum resource allocation, the SDC with Greater Kota Kinabalu serving as the main growth pole, has designated six Strategic Development Areas (SDAs) in Sabah to complement the Greater Kota Kinabalu Initiative.
These are the Bio-Triangle, Agro Marine Belt, Interior Food Valley, Kinabalu Gold Coast Enclave, and Brunei Bay Integrated Development Area and Oil and Gas Clusters. The SDAs have specific fiscal incentive packages for investors.
Under the 11th Malaysia Plan 2016-2020, a key focus for Sabah’s development is to invest in infrastructure to improve connectivity within the state and international linkages.
Besides Pan Borneo Highway Sabah, there is a planned RM311mil Kota Kinabalu Bus Rapid Transit project.
As part of the SDC, there are plans to build a new Kota Kinabalu airport, a light rail transit system in Kota Kinabalu, new railway lines to connect the north and east coasts of Sabah as well as upgrading the Lahad Datu airport.
The Sarawak Corridor of Renewable Energy (Score)
The Score is an initiative undertaken in early 2009 to develop the central region and transform Sarawak into a developed state by the year 2020.
It aims to achieve the goals of accelerating the state’s economic growth and development as well as improving the quality of life for Sarawakians.
The core of the corridor is the energy resources, particularly hydropower (28,000 MW), coal (1.46 billion tonnes) and natural gas (40.9 trillion sq cu ft) found abundantly in the central region.
This will allow Sarawak to price its energy competitively and encourage investments in power generation and energy-intensive industries that will act as triggers for the vibrant industrial development in the corridor.
In terms of land area, Score is the second largest of the corridors and covers more than 70,000 sq km of the resource-rich central region with a population of more than 600,000.
Score has a long coastline of more than 1,000 km, over eight million ha of forest and almost five million ha of arable land and peat land suitable for agriculture. The corridor has 0.8 billion barrels of known oil reserves, over 80 million tonnes of silica sand and over 22 million tonnes of kaolin of China clay, a key component of cosmetics, ceramics and, most recently, combat area medical equipment.
Tanjung Manis, Mukah, Samalaju, Baram and Tunoh have been selected as the five new growth nodes.
Score has been successful in attracting 21 approved projects with investments totalling RM30.7bil as of the middle of last year.