Singapore, Malaysia sign deal to set up special economic zone in Johor; passport-free access at land checkpoints being explored

• Singapore and Malaysia on Thursday (Jan 11) signed a Memorandum of Understanding (MOU) on a new Johor-Singapore Special Economic Zone (SEZ)
• Under the MOU, both sides will work towards boosting the cross-border flow of goods and people and developing a framework that will lead to a full-fledged agreement on the zone
• Singapore and Malaysia are also exploring other initiatives leading up to the SEZ, including a passport-free clearance system on both sides of the border
• Further updates on the SEZ are expected at the 11th Malaysia-Singapore Leaders’ Retreat later this year

JOHOR BAHRU: People travelling between Singapore and Johor may soon be able to enjoy passport-free clearance on both sides of the border, as well as digitised processes for cargo clearance at the land checkpoints.

These are among the "early initiatives" being explored leading up to a new Johor-Singapore Special Economic Zone (SEZ), which aims to boost cross-border economic connectivity between Singapore and Malaysia.

A Memorandum of Understanding (MOU) was signed on Thursday (Jan 11) between both countries to develop a framework for a legally binding agreement on the SEZ.  

The MOU was signed in Johor Bahru by Singapore’s Minister for Trade and Industry Gan Kim Yong and Malaysia’s Minister of Economy Mohd Rafizi Ramli.

Prime Minister Lee Hsien Loong and his Malaysian counterpart Anwar Ibrahim witnessed the signing.

Under the MOU, both countries will explore several initiatives that will "build towards" the SEZ, including more expeditious clearance of people at land checkpoints, and the facilitation of renewable energy cooperation between Malaysia and Singapore, said Singapore's Ministry of Trade and Industry (MTI) and Malaysia’s Ministry of Economy.

In a joint statement, the ministries added that the MOU, which comes two months after the 10th Singapore-Malaysia Leaders’ Retreat last October, "reaffirms the longstanding ties and joint commitment by both countries to strengthen economic cooperation".

Both sides also agreed to work towards a full-fledged agreement on the Johor-Singapore SEZ and provide an update at the 11th Malaysia-Singapore Leaders’ Retreat, to be held in Malaysia this year. 

Both countries had first announced that they would set up a task force to study establishing an SEZ at the 16th meeting of the Malaysia-Singapore Joint Ministerial Committee for Iskandar Malaysia in July 2023.

Three months later, at the Singapore-Malaysia Leaders’ Retreat in Singapore, Mr Lee described the proposed SEZ as a "substantial and promising project" which, among other things, should lead to smoother trips for people working on either side of the Causeway, one of the world's busiest border crossings.

WHAT TO EXPECT UNDER THE SEZ

According to the joint statement, the two countries will "explore work on several initiatives that will build towards" the SEZ.

These are:

• A one-stop business or investment service centre in Johor
• Implementing a passport-free QR code clearance system on both sides
• Digitised processes for cargo clearance at the land checkpoints
• Co-organising an investors forum to gather feedback from businesses on the Johor-Singapore SEZ
• Facilitating Malaysia-Singapore renewable energy cooperation in the zone
• Curating training to address talent and skill gaps for industries in the SEZ
• Developing joint promotion events between Johor and Singapore to promote trade and investment in the SEZ

"These early initiatives demonstrate the collaborative spirit between both sides and mutual interest in the Johor-Singapore SEZ to drive economic growth," said the ministries.

Both sides also agreed to develop a Johor-Singapore SEZ framework that will determine the economic sectors for cooperation and the geographical coverage of the SEZ.

The MOU also establishes a Johor-Singapore SEZ Committee co-led by MTI and Malaysia’s Economy Ministry.

This committee will report to the Joint Ministerial Committee for Iskandar Malaysia (JMCIM) co-chaired by Singapore Minister for National Development Desmond Lee and Mr Rafizi, the Malaysian economy minister.

Earlier on Thursday, Mr Lee and Mr Anwar also met to mark the Johor Bahru-Singapore Rapid Transit System (RTS) Link Project reaching the 65 per cent construction milestone on both sides.

Targeted to begin operation in December 2026, the RTS Link service will connect Bukit Chagar in Johor Bahru to Woodlands North in Singapore, with a peak capacity of up to 10,000 passengers per hour per direction.

This article was originally published on Channel News Asia. Its inclusion on this website is solely for education purposes.