 |
 |
 |
 |
|
|
Malaysia Beggar thy neighbour "Damn the commuters" "So you want to reform the education system?" "Damn the new voters" Back to homepage |
| Last revised: 27 June, 2001 |
|
| Beggar thy neighbour! (continued) These are not the only areas where Malaysia and Singapore together can create tremendous economic value where previously there were none. The development of high speed commuter railways from Malaysia to Singapore will enable Malaysia to attract many foreign professionals currently working in Singapore (they number 1 million people) to reside in Malaysia, increasing demand for residential properties and goods and services here. The increase of direct flights from Singapore to popular recreational destinations in Malaysia will enable the expatriate population in Singapore to spend week-end tourism dollars in Malaysia, boosting our tourism industry and foreign exchange. The list goes on (please see accompanying table) If one were to hazard a guess as to the economic value of a prosper thy neighbour policy, this could amount to well in excess of RM250 billion to be shared between Singapore and Malaysia. Not a bad sum just for being good neighbours. |
| Actions |
| Impact on Malaysia |
| Impact on Singapore |
| Unsuccessful renegotiation of new water supply agreements causes Singapore to look for other sources Tanjung Pelepas and WestPort compete head on with Port of Singapore Authority for international shipping cargo. Unresolved CIQ issue at Singapore checkpoint stalls any further development of commuter and cargo rail links. Unresolved CPF reimbursement issue. Malaysians who have worked in Singapore but have returned unable to retrieve CPF savings until 55 years old. |
| Malaysia loses revenue from its biggest customer for water as Singapore obtains alternative supplies (from desalination plants and from Indonesia). Economic loss : RM20 billion Malaysia ports remain in the red as a result of aggressive price cuts to gain market share Economic loss : RM 5 billion Malaysia loses opportunity to develop comprehensive Singapore/Malaysia rail links and associated benefits Economic loss : RM25 billion Pool of savings that would have otherwise been spent on property in Malaysia stuck in Singapore CPF. Economic loss : RM10 billion |
| Singapore builds its own desalination plants and passes on expensive cost to Singaporean consumers. Economic loss : S$10 billion Singapore port revenues affected by aggressive price competition from Tanjung Pelepas, Port Klang and Westport . Economic loss S$1 billion Singapore loses opportunity of developing cargo rail links that would enhance Singapore. Economic loss : S$10 billion Creates ill will among Malaysian workers who have contributed to Singapore's economy No immediate economic loss |
| Actions |
| Impact on Malaysia |
| Impact on Singapore |
| Successful renegotiation of new water supply agreements Malaysia designates Gelang Patah as a Free Trade Area, with minimal or zero border formalities with Singapore Development of warehousing and logistics zone in Gelang Patah taking advantage of proximity to Singapore ports Malaysia develops cargo railway services from Singapore port through Malaysia to Thailand and beyond (current railway track is 100 meters away from Singapore's port). Malaysia develops high-speed commuter rail links between Kuala Lumpur to Singapore Greater number of direct flights from Singapore to Langkawi, Malaysian East Coast and East Malaysia Resolution of CPF savings reimbursement issue |
| Malaysia retains revenue from water exports, and works in new treated water agreement at higher value. Economic gain : RM30 billion Malaysia attracts overspill of multinational Singapore electronics factories from Singapore, emerges as world's largest electronics exporter. Economic gain : RM 20 billion Malaysia becomes warehousing and logistics centre for Asia attracting shipping, airfreight and logistics companiesEconomic gain RM20 billion ). Malaysia becomes the backbone for all railway cargo destined for Singapore port from Thailand, Myanmar and beyond. Economic gain : RM20 billion Malaysia, from Malacca south to Johore, become home to expatriate and Singapore commuting professionals looking for landed residences, increasing land prices and local economy. Economic gain : RM 10 billion. Malaysia becomes recreational destination of Singapore based expatriates and professionals. Economic gain : RM 10 billion Malaysia benefits from increased investment in residential property, possibly shares, propelling increase in property and stock market values. Economic gain : RM20 billion. |
| Singapore negotiates new water agreement with Malaysia guaranteeing inexpensive supplies beyond 2061. Economic gain : S$10 billion Current Singapore-based electronics companies able to take advantage of larger labour pool and inexpensive land to remain competitive. Economic gain: S$10 billion. Singapore ports become more competitive as they are able to offer not only shipment but also inexpensive warehousing capacity. Economic gain : S$5 billion Singapore port gets access to Thai shippers market, opening new lucrative revenue sources. Economic impact : S$10 billion Singapore attracts/retains human capital because of ability to reside in spacious Malaysia but commute to built up Singapore. Economic gain : S$5 billion Singapore attracts/retains human capital because of easy access to recreational destinations. Economic gain : S$5 billion No economic loss other than having to liquidate some GIC portfolio investments to pay for advanced redemption |
| Table A : Economic Impact of Beggaring Thy Neighbour |
| Table B : Economic Impact of Prospering Thy Neighbour |