Malaysia’s Forest City and Singapore rail link top of mind as PMs meet, push ahead with special economic zone

The neighbouring nations approved a special economic zone on Thursday, as they aim to revive interest in Chinese developer Country Garden’s project

Earlier, their leaders took a selfie checking out work on the Johor Bahru-Singapore Rapid Transit System, two years ahead of its scheduled completion

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Lee Hsien Loong and Anwar Ibrahim look on as Singapore’s trade and industry minister, Gan Kim Yong (centre, left), and Malaysia’s economy minister, Mohd Rafizi Ramli (centre, right), shake hands after a signing ceremony in Johor Bahru on Thursday. Photo: Reuters

Published: 1:47pm, 11 Jan 2024Updated: 8:58pm, 11 Jan 2024

The leaders of Malaysia and Singapore met on Thursday as the nations seek to re-energise the beleaguered US$100 billion Forest City development in Johor Bahru, formally agreeing to develop a special economic zone and hailing progress on a new rail link slated to open in 2026.

Singapore Prime Minister Lee Hsien Loong shared a selfie with Malaysian counterpart Anwar Ibrahim on X, formerly Twitter, showing the pair on site at the under-construction rail link that is set to span the Strait of Johor, one of the world’s busiest border crossings.

Anwar last year announced plans to establish a special financial zone in Forest City, offering tax breaks and easy visa access to foreign professionals currently living in neighbouring Singapore.

Malaysian Prime Minister Anwar Ibrahim (left) and Singapore Prime Minister Lee Hsien Loong meeting in Johor on Thursday. Photo: X/leehsienloong

The incentives aim to revive interest in the mega-project – being built by Chinese developer Country Garden – after it failed to draw buyers from China, where an economic slowdown has made many prospective investors apprehensive.

Around 28,000 condominium units have been built so far under the project’s first phase. But only about 9,000 people currently call Forest City home – a fraction of the total project’s 700,000 population target.

The Johor-Singapore Special Economic Zone, which was discussed at a leaders’ retreat in October, intends to build on the existing trade between Singapore and Malaysia’s southern state of Johor, the two countries said in a joint statement.

It is “an unprecedented opportunity to enhance the cross-border flow of goods and people, bolster the business ecosystem and elevate the economic attractiveness of both Johor and Singapore”, said Malaysia’s Economic Minister Rafizi Ramli, who signed Thursday’s memorandum of understanding on behalf of Malaysia.