Knight Frank calls for clear incentives to drive investments in Johor-Singapore Special Economic Zone

• Knight Frank executive director Amy Wong Siew Fong: "SME (small and medium enterprise) players and multinational corporations in Singapore are still awaiting clear incentives before making any commitments."

KUALA LUMPUR (Jan 15): The establishment of the Johor-Singapore Special Economic Zone (JS-SEZ) has garnered attention, but more effort is needed to enhance its competitiveness to attract investments, according to Knight Frank executive director Amy Wong Siew Fong.

Answering questions at the Bursa Malaysia-Hong Leong Investment Bank (HLIB) Stratum Focus Series XVIII forum, themed "Property Sector: Entering a New Cycle", on Wednesday, Wong highlighted some comparisons between Johor and Singapore.

"Singapore's lower corporate tax rates and talent pool render it a more attractive investment destination, which Johor lacks," she said.

While acknowledging that the JS-SEZ is still in its nascent stages of development, Wong stressed that incentives remain a critical factor in attracting investments.

"SME (small and medium enterprise) players and multinational corporations in Singapore are still awaiting clear incentives before making any commitments," Wong noted.

Despite the challenges, Wong said Malaysia's stable political environment is a key driver to spur investments in the property sector.

But she cautioned that China's economic slowdown could pose a risk for the property sector, particularly in industrial properties. "Because we are still very much an export country, if demand falls globally, it will impact us. If China gets hit, industrial sectors will also feel the impact," she added.

The agreement for the JS-SEZ was signed last week. The SEZ is being set up with the aim to foster greater economic collaboration between the two neighbouring countries.

It targets to attract high-value investments into the region, and create 20,000 job opportunities across a diverse range of sectors within the first five years.

In her opening address at the forum on Wednesday, HLIB chief executive officer Lee Jim Leng said the property sector's outlook is positive, given the wage increases for civil servants and higher minimum wages, which are both expected to boost disposable income and drive property demand.

Lee also pointed to the current 3% overnight policy rate and stable mortgage rates, making homeownership accessible.

She said HLIB expects a gross domestic product growth of 4.9% this year, with a stable employment growth rate.

"These positive indicators provide the right conditions for sustained growth, and a virtuous cycle of demand and investments that contributes to Malaysia's broader economic development," she said.

"While these are promising signs, it is necessary for continued innovative strategies and collaboration within the industry to tackle the challenges," she added.

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