JOHOR BARU: The economic chain of Malaysians working in Singapore has been disrupted, causing local businesses to suffer losses following the closure of the border since March.
Universiti Teknologi Malaysia’s (UTM) Azman Hashim International Business School Associate Professor Dr L. Nanthakumar said Malaysians who earned income in Singapore were major contributors to the local economy before the border closure due to Covid-19 pandemic.
He pointed out that this was very visible with many businesses in the city recording losses following the implementation of movement control order (MCO).
“In a study that we conducted in 2018, we found that the high exchange rate between the ringgit and the Singapore Dollar was the main reason Malaysians chose to work across the Causeway.
“However, even with good salaries, the majority of Malaysians working there are not able to afford to buy or even rent a house in Singapore due to the high cost of living, ” he said.
Nanthakumar stressed that because of this, they preferred to live in Johor and travel daily to Singapore for work.
He added that they brought their hard-earned income back into the country, which was good for the local economy.
“They can buy property, vehicles and do all their shopping here in Malaysia. Their contribution has helped our local economy to grow and businesses to flourish, ” he said.
Nanthakumar added that if the border was not reopened soon, it would have a major impact on the local economy as Malaysians working in Singapore may lose their jobs, increasing the number of the unemployed here.
“Opening the border will be a win-win situation for the two countries as Singapore is also dependent on Malaysian workers who make up most of their migrant workforce, ” he said.
Meanwhile, Johor-based small and medium enterprises (SMEs) are hoping that both countries can expedite the reopening of the border to spur the economy.
TC Lau Distributor Sdn Bhd proprietor Lau Chee Siong, 43, said the company, which distributes fruits, received fewer orders and even cancellations during the MCO.
He said most of his clients catered to Singaporean customers and locals working there but living in Johor Baru as they have stronger purchasing power.
“Johor Baru market is quite reliant on Singaporeans and those working in the republic including Johoreans, ’’ said Lau.
He said thousands of Malaysians who live in Johor Baru, especially in Iskandar Malaysia, but work in Singapore contributed significantly to the state’s progress and economy.
“Opening the border will spur the state’s economy, ’’ he said.
AMS Aluminium and Glass Sdn Bhd business development director Ralph Low, 42, said the company was not able to deliver its products to Singapore clients during the Covid-19 pandemic as the products were considered non-essential items.
He said the company’s revenue had dropped to about RM3mil from RM5mil for the current financial year, adding that he hoped business would improve soon.
Fincorp Advisory Southern mortgage division partner Myron Wong, 37, said the Iskandar Malaysia property market would definitely be hit as it depended on locals working in Singapore.
He added that Johor and Singapore were economically interdependent and that it would do no good for business on both sides of the Causeway if the border remained closed for a long period.
An estimated 200,000 to 250,000 Malaysians travel to Singapore via the Bangunan Sultan Iskandar, Customs, Immigration and Quarantine (CIQ) and the Kompleks Sultan Abu Bakar CIQ daily for work.
Singapore and Malaysia are currently in negotiations to allow cross-border travel for certain groups of people.
This was discussed between Prime Minister Tan Sri Muhyiddin Yassin and his Singapore counterpart Prime Minister Lee Hsien Loong in a telephone call on Friday.
The two leaders agreed to establish a Reciprocal Green Lane (RGL) and a Periodic Commuting Arrangement (PCA) for different groups of travellers.