Policy versus implementation- the challenge for SJER

It is always easier said than done.

I may have many misgivings about the Malaysian government, but they sometimes do come up with great policies and visions. The problem is in getting the execution underway, the quality of execution and enforcement.

The South Johor Economic Region is a great idea.

It is being likened to the Hong Kong-Shenzhen economic area when it comes into being (repeat when it comes into being) and it would be a good thing for both countries.

In development economics, it is found that in a trade relationship between two countries with one being “richer” than the other, the “poorer” stands to benefit more and converge to the standards of the “richer” without much detriment to the “richer” in a statistically significant way. In fact, the “richer” country also benefits as it did not previously.

In this case, Singaporean companies would have access to nearer (should thus be cheaper) resources while it focuses on R&D. Johor would have more jobs, companies will have to raise standards to meet demands of Singaporean global firms and the SJER will have higher living standards in the course of time. The spillover effects would be higher demands for housing, rising home prices which is also a rise in wealth for home owners. The influx of people from surrounding “rural” areas will give rise to the need for more education institutions, other amenities- everything points to greater economic activity.

However, with Hong Kong and Shenzhen, there is a higher power (China) which can be an arbiter of arising problems and it is also China that has the motives to make successful the economic co-operation and development between the two areas.

The region also has the advantage of having an entrenched laissez-faire culture that puts business objectives at the top, never mind racial or historical animosity.

Lacking the two variables which contributed to the success of the Hong Kong- Shenzhen model, Singapore and Malaysia must put in extra effort and commitment to make the SJER-Singapore economic area a reality and a success for both.

In the study of development, there is also the rationale that it is better to have a more affluent neighbour than a poor one with all addendum problems associated with a poor country (more instability, more social rife).

Here is where Johor or Malaysia needs to make proactive improvements. Johor Baru is notorious for thefts, especially targeting Singaporean cars and nationals. Many Singaporeans do not do over to do their shopping in JB anymore. Even Malaysians who drive cars with Singapore registration numbers have a fear.

This is a serious problem of reputation as much as it is material.

Pak Lah and Khairy, SJER is your baby. Raise it well.