Continuity, Stability Promise Significant Economic Gains for Two Neighbours

By TENGKU NOOR SHAMSIAH TENGKU ABDULLAH SINGAPORE, Feb 26 (Bernama) -- The 4th Malaysia-Singapore Leaders' Retreat attended by Malaysian Prime Minister Najib Razak and Singaporean counterpart Lee Hsien Loong from Feb 18 to 19 has the ingredients of becoming a historic event. Among the many decisions adopted to take mutual interest collaboration between the neighbours to new heights, the announcement on the construction of a high-speed rail link between Singapore and Kuala Lumpur is historic, with potentially long-term benefits to the economies of the two neighbouring nations. This may be just the beginning of a wider connectivity infrastructure among Asean members which will enhance economic benefits of the Asean Economic Community (AEC), which is set to become a reality in 2015. It reflects a long-term vision of mutually-beneficial interdependency and closeness between the two countries that paves the way to significant economic and political benefits. It has all the potential of a "game changer", as put by Najib. He said the long-term plans require continuity and stability, a point echoed by his Singaporean counterpart. As Malaysia gears towards its 13th General Election, not only the Singapore prime minister but investors alike would want continuity and stability in a country like Malaysia, where they have vested interests. For Singapore -- Malaysia's second largest export destination and second largest source of imports as well as single largest investor in the Iskandar region -- would not want a change in government as it could create uncertainty. Efforts made by both prime ministers that led bilateral ties to an excellent level would continue to prosper, if the present government continues to rule while investors' confidence remains as they would not have to worry about changes in policy. Christian de Guzman, vice-president of Moody's Investors Service Singapore Pte Ltd, said: "From our perspective, one important thing for us is policy certainty -- assurance that the policies were continued there, should not be a problem," he told Bernama in a telephone interview. From the Western standpoint, he said foreign investors would like to see the incumbent party win as the present administration is seen to be "pro-business" and "quite forward-looking". Saying he was not taking sides, the analyst said bringing in the opposition "would risk uncertainty" as they would be in the dark over their policies. On the retreat's outcome, Malaysian High Commissioner to Singapore Md Hussin Nayan described it as a huge success with projects agreed at earlier meetings progressing well, while proposals for new joint investments had also been agreed upon. "The signing of agreements for the project in Medini and the launch of exclusive projects such as Marina One and Iskandar Waterfront between renowned private entities from both countries are clear signals that would drive and expand the scope of cooperation between the two countries," he said. Md Hussin said the announcement regarding the Singapore-KL rail link cooperation project indicates a milestone for both countries to continuously explore and realise economic potentials for mutual benefit. Head of Investment Strategy and chief economist at AMP Capital, Dr Shane Oliver, said: "The meetings appear to be successful and if both leaders continue to build on what they have achieved at the retreat, then it should be good for both Malaysia and Singapore." Nick Wright, senior vice-president and head of Global Services and Global Markets for South Asia, State Street said: "We support all efforts for closer regional collaboration and we believe it will serve Malaysia and Singapore well.” Annie Koh, vice president of Business Development and External Relations at Singapore Management University, said industries across both sides of the causeway have hailed the high-speed rail as the way forward for the collaboration of both countries. She said not only will tourism-related industries benefit from this, many visitors attending conferences and conventions in Singapore will now have good reasons to take short day-trips to Kuala Lumpur. "And if the high speed trains have a local line with three or four stops in between, there will be reasons to stop over at Melaka, Ipoh and other places in between. Many Singaporean SMEs also see possibilities to engage more workers in the outskirts of Johor to work at factories in Iskandar and perhaps, stay in their own homes outside of Johor." Koh said the rail connectivity goes beyond moving people - it could also lead to the movement of goods and enables perishable products to reach their market within a shorter duration. "If extended, the vision is to continue eventually from KL to Bangkok; that will elevate the Asean collaboration to another whole new level. The aspiration to be one common market has started to look a lot more attainable and (Prime) Minister Najib is right, this is a game changer," she added. -- BERNAMA