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Stretching the boundaries
Incentive
The Lifestyle and Leisure Cluster is headed by Mubadala, whose plans include developing 1,240 acres into a City Centre, Golf Village, Medical and Wellness Village, Amusement Bay and a Residential District.
Immigration, transportation, tourism and marketing, and environment are all hot issues too, affecting both Singapore and Malaysia's future well-being.
Proposals include looking at a tie-in with Singapore's Light Rail Transit (LRT) and Mass Rapid Transit (MRT) systems, although planning and execution complexities mean neither would likely come to fruition before 2015 and 2018 respectively. Water transport is being explored in the interim, connecting Marina Bay and Woodlands districts and Puteri Harbour next to Medini.
Much will depend on the effectiveness of the Iskandar Regional Development Authority (IRDA), the Federal statutory body responsible for realising Iskandar Malaysia's vision and objectives, in appealing to global investors.
It has established a ‘one-stop centre' to reduce red tape and provide quick approvals and its Incentive and Support Package extends to six sectors - creative industries and related services; educational services; financial advisory and consulting services; healthcare and related services; logistics services; and tourism.
Ahmad said the three main sales incentives are 10-year tax breaks for developers in Node 1, 100% profit repatration for overseas companies and freedom of staffing levels.
The project targets developers looking for an attractive location for commercial or retail development; operators of four and five-star hotels; large mall operators (the Medini Mall will be linked to an urban theme park); and tenants looking to set up their regional headquarters.
"It's natural for some people to be sceptical, but if we make it work, it will be a ‘win-win' for both Malaysia and Singapore," said Ahmad.
Iskandar comprises five special economic zones:
Zone A: Johor Bahru city centre. The 1,800-acre Danga Bay will be an integrated waterfront area, home to the financial and commercial centre
Zone B: Nusajaya. Features seven signature developments - EduCity, International Destination Resort, Johor State New Administrative Centre, Medical City, Puteri Harbour, Residential Developments and Southern Industrial and Logistics Clusters. General Electric Co has also entered into an arrangement with UEM Land Sdn Bhd to design a safety and security blueprint for the whole of Nusajaya.
Zone C: Western Gate Development. Features the bustling Port of Tanjung Pelepas.
Zone D: Eastern Gate Development. Even more shipping activity, containing Pasir Gudang Port and Tanjung Langsat Port
Zone E: Senai-Skudai. This area, 35km north west of Johor Bahru city centre, features Bandar MSC Cyberport, which is positioned as an ‘IT Cybercity' with strong emphasis on technology.
Developer tax incentives
Approved developers will be entitled to:
• Exemption from income tax up to year of assessment 2015 on statutory income from the disposal of any right in or over land within the approved node
• Exemption from income tax up to year of assessment 2020 on statutory income from the rental or sale of buildings within the approved node
• Exemption from withholding tax on payments made to non-residents for services, interest and royalties, up to December 31, 2015.
Approved development managers will be entitled to:
• Exemption from payment of income tax on statutory income from the provision of management, supervisory or marketing services to an approved developer until the year of assessment 2020
• Exemption from withholding tax on payments made to non-residents for services up to December 31, 2015
Growing trade
Trade between the UAE and Malaysia increased 20.65% last year. The UAE's top exports to Malaysia were crude oil and other petroleum products, while major imports from Malaysia comprised furniture, jewellery, machines, consumer electronics, palm oil and other manufactured goods, according to the Malaysia External Trade Development Corporation (Matrade). The UAE was Malaysia's biggest trading partner in the Arab region in 2006 and ranked 22nd globally.
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