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Some tough questions awaited Malaysia's Deputy Prime Minister Najib Razak during his two-day visit to Singapore.
Will the Malaysian government change its economic policies midstream like it has done in the past? What is being done to tackle the high crime rate in Johor, home to the Iskandar Development Region (IDR)?
But Mr Najib, who left Singapore on Tuesday, did not shy away from such questions — even though his answers did not satisfy everyone.
He was here to lead the Malaysian International Roadshow, which is aimed at increasing awareness among institutional investors of investment opportunities in Malaysia — especially in the IDR, a multi-billion-dollar plan to to turn southern Johor into a vibrant commercial and economic hub.
During a media briefing on Tuesday, Mr Najib said he had assured investors there will be no flip-flop in the government's IDR policies.
Many investors have still not forgotten the lingering hostility over the unexpected closure of Clob International in 1998 and the hefty exit levy imposed on Singapore investors who bought properties in Johor.
"I gave them the assurance that a project like the IDR has the support of not just the Prime Minister but also the entire government. Policies will be consistent, we will not flip-flop, because we realise we're living in a different world — a world that's getting more and more competitive," said Mr Najib.
Over the past two days, the Malaysian deputy premier and his team of high-powered government officials held closed-door meetings with institutional investors, hedge funds and Temasek Holdings.
While "most encouraged" by the "strong interest" in the capital market, Mr Najib revealed these potential investors also voiced several concerns about the IDR project, which will require an investment of some RM382 billion ($172 billion) over the next 20 years for it to succeed. Top on their list: The frequent power outages and the crime situation in Johor.
To address the latter, Mr Najib said that he would get the police to tackle the high crime rate.
"I will convey these concerns to the police, talk to them and see what they are likely to do to ensure a safe and secure environment. They will undertake a proper plan on how to combat crime," he said.
As for his talks with Temasek, Mr Najib said that while the investment firm shared concerns similar to those of other investors, it also wanted a stable long-term investment environment. "I will give the undertaking that we will continue until these long-term goals are achieved," the deputy premier said.
When asked about vocal protests in Malaysia over the possible loss of bumiputra rights within the IDR, Mr Najib said: "We have engaged the constituencies in Malaysia, particularly in Johor. As you know, some of the local politicians have come out openly in support of the IDR. People are becoming more supportive and embracing the idea and concept of development. I think the majority of the people will come out in support of what we plan to do in southern Johor."
Already, Malaysian fund managers, often the harshest critics of government policies, are embracing the IDR project with enthusiasm, said Mr Song Seng Wun, a regional economist with CIMB-GK Research.
For example, CIMB Group, Malaysia's second-biggest financial services provider, is looking at tapping into the growth potential of the IDR. Next month, it will be opening an office in New York to attract United States fund managers to southern Johor.
Mr Najib told reporters the Malaysian government has secured a "substantial amount" in investments and will be announcing details later this year, after investors have firmed up their commitments. Looking ahead, Mr Najib said the existing Second Link and the Causeway will be able to handle the increase in cross-border traffic, for both goods and people, that is expected to take place once the IDR takes off.
When asked if a new bridge will be built, Mr Najib said: "We can let this happen in a natural manner ... because if you have a greater flow of people, goods and services, and there is increase in demand, then the two countries can decide at any point to construct a bridge or whatever linkages we need to build."
- TODAY/so
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