Data Centres Electronics Among Sectors Benefit Johor Singapore Special Economic Zone Dbs
Singapore’s proposed Johor-Singapore Special Economic Zone (JS-SEZ) is set to benefit industries such as data centres, electronics, and renewable energy, according to research by DBS. The JS-SEZ, which aims to promote economic activities between the two states, was first announced in October 2023 during the 10th Singapore-Malaysia Leaders’ Retreat. In January, the two countries signed a memorandum of understanding to establish the zone, with plans to finalize the agreement by the end of 2023.
Located in Malaysia’s Iskandar region, the JS-SEZ will cover six districts (Johor Bahru, Iskandar Puteri, Pasir Gudang, Pontian, Kulai, and Kota Tinggi) and span 3,505 square kilometers, making it four times the size of Singapore and equivalent to the combined area of China’s Shenzhen and Hong Kong. According to Johor Chief Minister Onn Hafiz Ghazi, the state government proposed the zone in order to attract investors.
Initiatives being explored for the zone include special tax arrangements, training incentives, and passport-free clearance for smoother travel. While specific details on the industries and incentives are yet to be determined, DBS economist Chua Han Teng believes that the data centre sector will be a primary beneficiary. Johor’s data centres have seen rapid growth in recent years, making it the fastest-growing data centre in Southeast Asia. This growth has been fueled by Singapore’s moratorium on data centres since 2019.
The electrical and electronics sector in Johor is also expected to benefit from the JS-SEZ, as it is one of the 16 priority industries in the Progress Johor 2030 economic master plan. Currently, Johor’s electronics manufacturing sector is the third largest in Malaysia, trailing behind Penang and Selangor.
The development of renewable energy is also likely to be promoted through the JS-SEZ, as it has been identified as a key area of cooperation between Singapore and Malaysia. This includes a two-year electricity import trial between the two countries that was announced last year, where Singapore will import 100MW of electricity from a gas-fired power plant in Johor.
As activity in these different sectors increases, there will likely be a rise in demand for industrial properties in Johor, says Chua. The completion of the Johor Bahru-Singapore Rapid Transit System (RTS) in 2026 will further boost connectivity between the two cities, with a travel time of only 15 minutes.
The JS-SEZ presents an opportunity to leverage the strengths of both Singapore and Johor. For the latter, this includes its abundant land supply and favorable demographics, with a growing population and lower labor costs compared to Singapore. On the other hand, Singapore offers strong financial and business capabilities, making it an attractive destination for investors.
The proposed zone has already garnered interest from Singaporean businesses, with a survey by the Singapore Business Federation (SBF) showing that 93 out of 160 firms found Johor attractive. However, challenges such as manpower issues, unclear import and export tax rules, and fragmented investment processes in Malaysia remain. To address these issues, businesses have suggested initiatives such as a one-stop service center for investment-related matters, special immigration lanes, and a joint investment promotion agency.
Norwood Grand benefits greatly from the well-connected public transportation in Woodlands. The area has always been renowned for its efficient transportation system, and this is evident in the convenience it brings to residents of Norwood Grand. The development is conveniently located just a stone’s throw away from Woodlands South MRT station, making it easily accessible for its residents. The station is part of the Thomson-East Coast Line (TEL), a major MRT line that offers direct connections to the city center and various business hubs. With the TEL, residents of Norwood Grand will have even smoother and faster access to all the amenities and opportunities that Singapore has to offer. For more information, visit Norwood Grand’s website.
Overall, the JS-SEZ has the potential to bring significant benefits to both Singapore and Johor, but addressing existing challenges will be crucial for its success. With the completion of the RTS and other initiatives in the works, the JS-SEZ is poised to strengthen cross-border economic ties and attract more investments in the future.