Singapore-Iskandar Akin To Hong Kong-Shenzhen?

Singapore-Iskandar Akin To Hong Kong-Shenzhen?

All this while, Singapore and Iskandar Malaysia conurbation has been likened to that of Hong Kong and Shenzhen. Indeed, the Malaysian’s government hopes that Iskandar Malaysia will emulate the success of Shenzhen in China, which was singled out as one of the five special economic zones in 1979. We believe the Singapore-Iskandar is a tad similar to the Hong Kong-Shenzhen model, with the huge differential in costs of living and property prices. Iskandar Malaysia has yet to reach its critical mass due to a lack of commercial activities in the area. Similar to Shenzhen, Iskandar will also require a
long gestation period to bloom.

A Matter Of Time
From the beginning, Iskandar Malaysia’s fate has always been uncertain and dubious. Nevertheless, the key breakthrough occurred with the signing of POA between the two countries. The G-G collaboration started and brought on countless changes in Iskandar. Catalytic projects in various sectors are springing up. Investments have exceeded expectations and locals are gaining confidence and began to dominate investments in Iskandar since 2009. We believe the region will continue to grow as more catalytic projects are being unveiled gradually. Time is of the essence for Iskandar to bear fruits while the
successful collaboration between the two countries is also critical.

Timeline – Shenzhen, China
July 1979 ƒƒ CPC Central Committee passed resolution to designate Shenzhen as a Special Economic Zone (SEZs)
1980 – 1991 ƒƒ July 1981: Development work started in Shenzhen
(area: 327.6 sq km; population: 314k with 83% rural population)
ƒƒ Infrastructure developments: power, roads, port, water
ƒƒ Favourable tax (15% tax vs. 33% going rate), land costs (30% – 50% cheaper vs HK)
ƒƒ Number of enterprises: 244 in 1979 vs. 4,000 in 1991
ƒƒ Population rose 7x: 2.3mn by end-1991
ƒƒ GDP rose 89x: RMB270mn to RMB24bn
1992 – 2002 ƒƒ Deng Xiao Peng revisited in 1992 – further push for developments
ƒƒ Aiming to match Singapore/HK size in two decades
ƒƒ July 1992: Shenzhen given more legislative autonomy, serving as a model for rest of China
ƒƒ By end-2002: GDP rose to RMB297bn, and population at 7.2mn
2003 – Now ƒƒ Newly installed President Hu Jintao visited in 2003 to reaffirm the model
ƒƒ Moving towards high tech industries and products: “high tech” products accounting for more than 50%
of industrial output
ƒƒ Economic convergence and further integration with HK
ƒƒ By end-2012: GDP RMB1.3tn or USD209bn vs. Singapore (USD268bn) and HK (USD263bn

 

Comparative Statistics
Indicators Hong Kong – Shenzhen Singapore – Iskandar
Area 3,566 sq km
Hong Kong – 1,104 sq km
Shenzhen – 2,462 sq km
2,927 sq km
Singapore – 710 km
Iskandar – 2,217 km
Population 17 million
Hong Kong – 7 million
Shenzhen – 10 million
7 million
Singapore – 5.3 million
Iskandar – 1.6 million
Daily Commuters 500,000 100,000
GDP per capita (USD) Hong Kong – 36,667 (2012)
Shenzhen – 17,096 (2010)
Singapore – 51,160 (2012)
Iskandar – 14,790 (2006)
Major Industries Hong Kong – Financial Services, Trading, Logistics,
Tourism
Shenzhen – Manufacturing, IT, Financial Services,
Logistics
Singapore – Financial Services, Logistics, Education,
Tourism, Healthcare
Iskandar – Manufacturing, Education, Tourism,
Healthcare

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