“Human capital is an incredibly important component in determining the success of Iskandar Malaysia, as development in this area has the potential to catalyse the growth of world-class industries” – Ismail Ibrahim, Chief Executive, Iskandar Regional Development Authority.
An authoritative role
The Iskandar Regional Development Authority (IRDA) was established in February 2007 through an act of Parliament, three months after the economic region was launched in November 2006. It serves as a federal government statutory body tasked with regulating and driving the various stakeholder groups, from both the public and private sector, towards realising the vision of Iskandar Malaysia: to become a strong and sustainable metropolis of international standing by 2025.
IRDA’s role is to plan, promote and facilitate development in Iskandar Malaysia, as well as to ensure that the economic region maintains a business-friendly environment without compromising elements that foster a holistic lifestyle and sustainability.
To assist investors considering Iskandar Malaysia as a destination for their capital, IRDA set up a facilitation division called the Iskandar Service Centre (ISC). The ISC coordinates and syndicates with the various other agencies involved in issuing the approvals necessary to realise investment in the region. The cooperation from the respective agencies that work closely with IRDA to ensure seamless business transactions has been invaluable to the success of the project.
Development in Iskandar Malaysia is founded on three key principles: equitable and fair distribution among stakeholders, value creation, and nation building. It is strategically located at the heart of Southeast Asia, adjacent to Singapore, an advanced economy and logistics hub. It is also well positioned to leverage on the fast growing economic powerhouses of India and China, as well as many emerging economies with burgeoning populations in the ASEAN region.
While the planned development in Iskandar Malaysia has been scheduled to take approximately 20 years to fully realise, beginning in 2006 and coming to fruition in 2025, the economic region has successfully achieved a number of milestones in a reasonably short time span. These include catalytic projects related to attractions, healthcare, education and entertainment, as well as a number of commitments to sustainability. In addition, the region has experienced tremendous development in several key sectors, such as property, manufacturing and services, among others.
When Iskandar Malaysia was launched, some critics and groups believed the project would become a white elephant. However, over the years, these people have become champions of Iskandar Malaysia and now speak highly of the development, recognising the many benefits it has brought to both investors and community stakeholders. They see the fruits of development here, and IRDA has played a significant role in securing their buy-in by engaging them personally and providing a more comprehensive understanding of what the project is all about. This reversal of perception, as well as the growing trust in Iskandar Malaysia is, in itself, a clear sign of success.
Sustaining growth despite uncertainty
Since 2006, the world has faced periods of economic downturn and financial crises, but Iskandar Malaysia has managed to weather these storms with vigour. IRDA has ensured that the region’s promoted sectors are diversified and resilient, allowing the project to mitigate economic headwinds. Additionally, the development strategy has not only focused on investment, but also on social inclusivity and environmental management. Thus, Iskandar Malaysia can realign its focus to other areas or countries as required until the economic outlook is brighter.
IRDA is fortunate to have strong commitment and support from both the federal and state authorities, which encompasses all government agencies at various levels. We have also built solid relationships with the region’s private sector stakeholders, which is crucial considering Iskandar Malaysia is principally driven by the private sector. The ratio of public to private investment in the region is 1 to 20; quite a favourable ratio when compared to other development regions. Strong private sector involvement also boosts the confidence of both local and foreign companies to invest here.
A focus on people
Iskandar Malaysia is for the people and, consequently, IRDA works hard to ensure our initiatives involve the community, such as the low carbon society initiative and the Smart Healthy City and Communities’ initiative. The overarching goals of this economic region are not just related to creating employment and business opportunities; they also revolve around allowing the community to experience a better quality of life and a superior lifestyle.
Clearly, it is vital to ensure projects stimulate physical and economic development, but this should not be the only concern. IRDA places significant emphasis on building soft infrastructure, as well as inculcating a sense of belonging and pride among local people in the area. Accordingly, we have facilitated numerous community-led and community-initiated activities in the region, which are supported by IRDA as part of its effort to strengthen social empowerment.
Driving human capital development
Human capital is an incredibly important component in determining the success of Iskandar Malaysia, as development in this area has the potential to catalyse the growth of world-class industries. High value-add sectors, such as biotechnology and data mining, require an educated, well-trained workforce. Accordingly, if the region can offer investors a high quality talent pool, they will be more inclined to locate their businesses here.
IRDA has focused on developing talent pools through reskilling and upskilling within targeted economic sectors and intends to increase the number of workers, as well as the range of skillsets, that cater to these industries as the project moves forward. This process will be facilitated through job matching, training and placement, and human capital development programmes, as well as career advancement planning.
Under the Comprehensive Development Plan ii 2014-2025 (CDPii), the proposed formulation of a wealth sharing and inclusiveness ecosystem will provide solutions to the human capital issues in Iskandar Malaysia, which are mainly due to talent shortages and a mismatch of supply. Moreover, the ecosystem will focus on mitigating income and housing price disparity, as well as building social capital and improving quality of life in parallel to this development corridor’s growing economic excellence.
Increasing skilled human capital in the local population, through better education and training, will contribute to greater economic participation and should translate into higher household income and reduce poverty. A coordinated approach to improving the quality of talent in Iskandar Malaysia, particularly in terms of providing sufficient numbers to drive growth in the promoted economic sectors, will enable both greater wealth creation and distribution.
Additionally, several new programmes will encourage previously employed stay-at-home mothers, who left the workforce to care for children, to re-join the world of work. This initiative will offer flexi-time opportunities to enable these women to generate an income that fits in with their family-oriented schedule.
Iskandar Malaysia is at the halfway point on the journey towards comprehensive development. The first and second phases have produced significant successes and been nothing short of exciting. With the development plan now entering its third phase, which focuses on sustaining and innovating, I am certain that it will be just as robust as the previous two.
Using the CDPii as a guide, the economic region is well on its way to becoming a strong and sustainable metropolis of international standing. By 2025, Iskandar Malaysia will be self-sustaining, buoyed by domestic and foreign investment, and it will incorporate active participation from the local community towards growth, particularly from small and medium-sized enterprises.
To achieve this, IRDA will continue to actively seek out both domestic and foreign investment, ensure that the region’s catalytic projects are successfully implemented, make substantial efforts to construct impactful and advanced infrastructure, and further the development of high quality and accessible education and healthcare.
Iskandar Malaysia has grown significantly since its launch and it will continue to blossom as the future unfolds. Despite the challenges that lie ahead, IRDA and its strategic partners and stakeholders possess the necessary means to overcome any obstacles that may fetter future success and to ensure the vision of Iskandar Malaysia is fully realised. I urge everybody to come and experience the development of Iskandar Malaysia with us.
ISKANDAR REGIONAL DEVELOPMENT AUTHORITY
#G-01, Block 8
Danga Bay, Jalan Skudai
80200 Johor Bahru
(607) 233 3000