The recently launched Johor–Singapore Special Economic Zone (JS-SEZ) aims to transform trade and investment in Southeast Asia by integrating Malaysia’s land and workforce with Singapore’s capital and technology. Officially initiated in January 2025, this ambitious cross-border initiative aspires to replicate the success of Shenzhen, China’s renowned hub for innovation. Yet, the project faces significant legal and governance challenges that could hinder its potential.
A solid legal framework is vital for the JS-SEZ’s success. The initiative seeks to enhance regional cooperation, but it is undermined by Malaysia’s complex regulatory landscape. The differing legal systems of Malaysia and Singapore present obstacles to seamless cross-border collaboration. While Singapore operates under a unitary governance model, Malaysia’s federal structure allows individual states considerable authority in land use planning, leading to fragmented regulations and inefficiencies.
The current state of Malaysia’s legal environment poses risks reminiscent of past projects like Forest City, a multibillion-dollar development that has largely fallen short of its lofty promises. Forest City was intended to become a thriving eco-city for 700,000 residents but now houses fewer than 10,000, with many buildings unoccupied and infrastructure underutilized. The project faced criticism for poor planning and has been marred by issues such as abandoned developments and environmental degradation.
To ensure the JS-SEZ does not suffer a similar fate, several critical reforms are necessary. Firstly, a dedicated JS-SEZ land development act is essential. This law would establish a coordinated approach to planning, land use, transportation, and environmental regulations across federal and state jurisdictions. Currently, overlapping authorities can lead to delays and confusion, undermining the initiative’s goals.
Secondly, Johor and Singapore should collaborate to create a statutory master plan governing land use, infrastructure, and public services. Without legal backing, such plans risk being ineffective. The master plan must be strategic, implementable, and subject to regular reviews to ensure its continued relevance.
Empowering technical agencies is another key reform. Departments responsible for public works, environment, and other relevant areas should transition from advisory roles to decision-making authorities in land use planning. Their approvals must be based on sound technical and environmental grounds, and they should be held accountable for providing accurate, real-time data. Outdated guidelines must be updated to reflect current realities, potentially utilizing artificial intelligence for improved decision-making.
Community involvement is vital for successful planning. Zoning regulations should balance investor interests with affordable housing, green spaces, and public amenities. Genuine community consultation should be legally mandated, ensuring that local feedback influences planning decisions. Rapid increases in property prices, particularly near rapid transit stations where costs have surged to over MYR2,000 per square foot (approximately USD 470), further necessitate legal measures to ensure equitable development and prevent speculation.
Finally, the JS-SEZ’s long-term viability depends on secure energy sources. Industries, particularly data centres, require stable and clean energy. While alternatives like solar and hydrogen are promising, they may not meet immediate industrial demands. A collaborative nuclear energy project between Malaysia and Singapore could provide a sustainable energy solution, but it must be supported by stringent legal frameworks and public engagement to ensure safety and security.
In conclusion, the success of the JS-SEZ hinges on proactive legal reforms that promote inclusivity, transparency, and sustainable development. Learning from past experiences like Forest City, Malaysia must prioritize robust legal safeguards to create a beneficial future for all stakeholders involved.
