Malaysia and Singapore have agreed to work together to develop a special economic zone in the southern Malaysian state of Johor. This cooperative effort aims to attract investments and facilitate the movement of goods and people across their shared border.
The Economy Minister of Malaysia, Rafizi Ramli, and Singapore’s Trade and Industry Minister, Gan Kim Yong, signed a memorandum of understanding for the Johor-Singapore Special Economic Zone (JS-SEZ) in a ceremony yesterday. They also expressed their commitment to establishing a comprehensive agreement during their 11th Leaders Retreat later this year.
Both sides stated that the SEZ would focus on enhancing cross-border flows of goods and people while strengthening the business ecosystem to support investments. They noted that the SEZ is built on the strong growth of Johor and significant investments in the region by Singapore.
Minister Rafizi Ramli believes that the JS-SEZ presents a unique opportunity for both nations to improve cross-border trade and movement.
In addition to the JS-SEZ, Singapore and Malaysia are exploring other initiatives such as a passport-free clearance system and potential renewable energy cooperation.
The completion of the first connecting span of the light rail link connecting Singapore and Johor’s state capital was witnessed by Singapore’s Prime Minister Lee Hsien Loong and Malaysian Prime Minister Anwar Ibrahim. This rail link, known as the RTS, is expected to alleviate traffic congestion on the Johor-Singapore Causeway and commence passenger service at the end of 2026.
This rail link is the latest upgrade to the Causeway, a structure that has undergone multiple expansions and upgrades since its construction in 1924.
Prime Minister Lee Hsien Loong stated that the RTS and JS-SEZ would enhance cross-border links, support businesses, and create jobs on both sides of the Causeway, bringing the friendship and bilateral ties closer.
These agreements are intended to further strengthen the close economic interdependence between Singapore and peninsular Malaya. The border between the two nations is one of the busiest in the world, with over 350,000 people commuting from Malaysia to Singapore across the Johor-Singapore Causeway each day.
Additionally, Malaysia and Singapore have discussed the construction of a high-speed railway connecting Singapore and Kuala Lumpur. Although the project was terminated in 2020, there are reports that Anwar’s government may be interested in reviving the project if the cost can be substantially reduced.