FOR the JS-SEZ to live up to its full potential, Johor’s infrastructure would need to keep up with the mass movement of people from both sides of the Causeway and its wider effects on city planning and local industries. These were the key talking points for the panel titled “Drilling down on JS-SEZ sectors”.
Of all of the areas that urgently need to be addressed, the ease of movement for people travelling between Johor and Singapore was stressed as an imperative.
Singaporeans who want to enter one of the nine flagship areas in Johor, such as the Iskandar Development Region or the Forest City Special Financial Zone, would need to cross the Causeway. And Malaysians and Singaporeans would be making this trip daily. So, if border crossings are not seamless, they would cause long-term issues and frustration among those making the commute.
To illustrate this, Datuk Lee Chun Fai, group CEO and managing director of IJM Corp Bhd (KL:IJM), highlighted the trip between Hong Kong and Shenzhen, which share a trade zone not too dissimilar to the JS-SEZ. When travelling from Hong Kong, locals only need to present their identity cards to enter Shenzhen. Foreigners have to show their passports and undergo a lengthier process.
What makes the JS-SEZ unique is that it comprises two countries, so most people passing through their borders would be foreigners. Lee said the necessary infrastructure and systems would have to be in place to allow movement between the two countries to be as seamless as possible, like it is for the locals travelling between Hong Kong and Shenzhen.
“You want the ability to move freely and therefore encourage movement. And not have people grudgingly doing so because they can earn better money,” he pointed out.
The Johor Bahru-Singapore Rapid Transit System (RTS) Link is being developed to better facilitate travel between the two countries. The railway shuttle link is expected to be completed by end-2026 and be able to ferry 10,000 passengers per hour.
While the RTS Link sounds great, Lee highlighted a few key issues that the project would cause and the further supporting infrastructure upgrades that would be needed to address them.
“Unfortunately, the RTS is located in a very central area, a very busy area. [The movement of] 10,000 passengers per hour would mean the dispersal of people in a very short period of time, which means that with a lot of buses and cars, the traffic would be quite busy. Public transport to address this would be sorely needed,” he said.
Singapore has a strong track record of planning and the timely execution of infrastructure plans. With two governments overseeing this project, Lee is hopeful that the added pressure will ensure deadlines are met, which will put investors and other stakeholders at ease.
IJM plays a strong role in supporting the development of infrastructure. On the construction side, it is already engaged with several construction contracts worth RM2.5 billion. They include three data centres, the RTS Link and the new Immigration, Customs and Quarantine (ICQ) complex.
These infrastructure projects have had a large impact on Johor’s real estate sector. For one, the value of properties in the vicinity of the RTS Link has risen to as high as RM1,500 per sq ft (psf), which is comparable with property prices in Kuala Lumpur city centre, according to Lee.
These infrastructure upgrades must be clear and their timely delivery would bring a level of certainty that investors look out for. This was a view shared by fellow panellist Samuel Tan, CEO of Olive Tree Property. “Infrastructure must be done before they come in, and not applying for coffers or money, because that will give a lot of uncertainty,” he said.
Positive momentum leads to rising land and property prices
While establishing solid infrastructure was stressed as a strong point to ensure the success of the JS-SEZ, it is not the only thing that Johor and Singapore need to develop.
Tan likened the development of the JS-SEZ to a computer, with the infrastructure being the hardware — something important to ensure seamless and excellent connectivity, which will drive up land prices. However, the success of the JS-SEZ also depends on the software, meaning clarity and consistency from the governments and policymakers.
He called for Malaysia and Singapore to capitalise on their unique two-country, cross-border collaboration that the JS-SEZ provides. By working together, the two nations can co-invest, co-promote and share talent to strengthen each other. By doing so, one country can fill the gaps that the other may be facing.
“We must never think that Malaysia is less talented than Singapore. We can complement each other through co-talenting. What [Singapore] is lacking, Malaysia can provide, and the other way around,” said Tan.
He added that amid the ongoing global geopolitical tensions, Johor has become a strategic and attractive investment destination, thanks to Malaysia and Singapore’s close relationship and long-lasting regard as neutral and business-friendly nations, which helps to draw in investors.
This growing interest in the region is echoed by Natazha Hariss, CEO of Invest Johor, who highlighted three key areas in the state that have garnered strong interest in recent years: manufacturing, digital economy and green technology.
“Johor is in a very good spot. [Thanks to] our proximity to Singapore, ample space, land, access to talent and infrastructure, companies — especially those in precision engineering and electronics — are shifting parts of their operations to Johor to manage pricing costs and supply chain risks,” he said.
Over the past two years, Johor has attracted major players from across the globe, with 20 data centres currently in operation and 30 to 40 more in the pipeline. While this influx is promising, the challenge now is for the Johor government to expedite infrastructure upgrades to keep up with the demand.
This momentum is carried into Johor’s other sectors, such as its property market. Tan noted that since the announcement of the JS-SEZ, the state had seen a significant uptick in job creation and investments. In the first quarter of 2025 alone, Johor secured RM30.1 billion worth of investments, with another RM23 billion in the pipeline, he added.
Tan delved deeper into sector-specific growth. He pointed out that the prices of manufacturing land have increased as factory space was going for RM400 to RM450 psf, up from RM300 to RM350, with data centres in particular willing to pay a premium for strategic locations.
Meanwhile, the residential and commercial property segments have followed suit, with serviced apartments near the RTS Link rising to RM1,500 psf from RM800 previously. Tan said a project that would be built near the RTS Link was priced at RM2,400 psf.
Despite these positive indicators, he warned that the key to the JS-SEZ’s long-term viability and success lies in delivering on its promises. This is not the first time that Malaysia and Singapore have attempted a joint initiative, and investor confidence will depend on the quality and timeliness of the execution.
Other crucial areas that Tan highlighted should remain a priority were closer collaboration between the government and the private sector, effective human resources management, addressing the rising cost of living and business operations, further stakeholder engagements, as well as policy consistency and transparency.
During the Q&A session, the conversation turned to small and medium enterprises (SMEs) and their role in the JS-SEZ ecosystem. Since the announcement of the JS-SEZ, many SMEs had expressed concerns that the initiative would heavily favour larger companies and that they would be left behind.
Natazha said this was something he was aware of and stressed the importance of SMEs to Johor’s economy. He added that his team at Invest Johor had heard the worries of local SMEs and would address them.
Natazha stressed that these concerns would be addressed under the full JS-SEZ blueprint that is expected to be announced in September and that engagement sessions with SMEs will be held after that. Incentives for the JS-SEZ were announced in January.
“I think for Johor alone, we have more than 200,000 micro, small and medium enterprises, ranging from food processing to precision engineering,” he said.
Natazha pointed out that it was not completely up to the government to help the local ecosystem and that SMEs must also rise to the occasion as it is a two-way street.
“SMEs also need to step up in terms of automation, using AI (artificial intelligence) and ESG (environmental, social and governance) compliance. I think MNCs (multinational corporations) would like to see some kind of basic ESG compliance among SMEs,” he said.
Retaining local talent
For the JS-SEZ to succeed, it must be able to attract and retain talent. According to Lee, this can only happen if higher value-add industries such as technology and advanced manufacturing are based in Johor. These sectors typically offer better-paying jobs, which can help close the wage gap with Singapore.
He explained that currently, the salary difference across the Causeway can be up to three times in ringgit terms. Even if Malaysia cannot fully match Singapore’s wages, reducing the wage gap to a certain extent could be enough to retain local talent. “Therefore, people will make the JS-SEZ a viable option because everyone would like to live with their family, everyone would like the joy of having a compound [at their workplace],” he said.
Tan echoed the importance of competitive salaries and housing support in attracting and retaining talent. He pointed out that the Johor Talent Development Council, together with Invest Malaysia Facilitation Centre Johor, is actively addressing this challenge.
Tan highlighted a proposal that included setting a minimum wage of RM3,500 for diploma holders and RM4,000 for degree holders — a move that has already been adopted by at least one bus manufacturing company in Senai.
Beyond compensation, he emphasised the importance of attracting talent from other Malaysian states. One initiative he proposed is for the Johor Housing Development Corporation to automatically qualify individuals for affordable housing if they have contributed to Johor’s economy, regardless of their state of origin.
“Anybody who has contributed over a certain term would automatically be qualified. Now, with a [big enough] household, I believe they may find reasons to stay in Johor rather than to go to Singapore,” he added.
Tan also stressed the importance of aligning academic output with industry needs. He noted that an industrial advisory panel embedded in institutions of higher learning could help shape curricula that match current market demands.
This point was echoed by Natazha, who highlighted how the state is working to bridge the gap between education and employment, such as developing a structured apprenticeship programme in collaboration with industry players and academia, under the Johor Talent Development Council.
“We have enough people, we have enough students. Now the challenge is for them to work in Johor, keep them after their graduation and hit the ground running. This is the way forward for us,” he said.
Johor is not short on talent. However, many are attracted to opportunities in the Klang Valley or even Penang. Natazha said for him and his team at Invest Johor, it is a matter of being creative with what talent they have now and proving that opportunities in Johor are as viable as in any other state in Malaysia.
