Singapore-KL high-speed rail – Experts see far-reaching benefits
Industry experts in Malaysia are already counting on the multiplier effects from the proposed high-speed rail link between Kuala Lumpur and Singapore even before its targeted completion in 2020. They say the benefits are expected to far-reaching. The project was jointly announced by the Prime Ministers of Singapore and Malaysia at their recent retreat. There is still no official word on how much project will cost, but initial industry estimates put the construction and land cost at about US$8 billion.
With those figures in mind, the proposed high-speed rail link between KL and Singapore has sparked excitement among some sectors. Among the biggest gainers are likely to be property and construction sector companies. Experts are predicting increased demand for property in the Klang Valley, the southern state of Johor and the possible stops along the route.
Paul Whiteway, COO, iproperty.com, says: “We are seeing it now, and that will continue to increase in the medium to long term. A lot of Singaporeans are buying properties in Malaysia particularly in key areas such as Iskandar, Johor, Klang Valley.” Other positive effects include increased tourist arrivals and investment from neighboring Singapore. Driven by space and manpower constraints, Singapore companies may move their operations to Malaysia as industry clusters emerge.
Analysts say Singapore too will benefit from a rise in talent pool as more Malaysian professionals may opt to work in the island republic when travel time is reduced to just 90 minutes. This, they add, will help narrow the income gap between the two countries in the long run. Veena Loh, GM, Malaysia Property Inc says: “You must remember, when Singapore competes for our talent our local companies would also have to raise the incomes of the people to retain the talent, so automatically the incomes of the people here would rise.” In fact, she believes the benefits of having a high-speed rail link will extend to the whole of ASEAN.
Ms Loh adds: “If you look at the global economy, everything is slowing down around the world. Only Asia is the bright spot in this region. Even China and India are slowing down. If we don’t do something, from where would the revenues be coming in? KL or rather Malaysia and Singapore are actually moving ahead. They are models for the other ASEAN countries – linking these two cities will actually improve us on the global map; it’s the right thing to do.”
While the high-speed rail link is welcomed with open arms by most people in Malaysia as well as across the Causeway, many, especially homebuyers, are worried that with the increased demand, property prices will continue to soar beyond the reach of most Malaysians. In fact, many doubt the government’s efforts to provide affordable housing will ever meet the demand of low to middle income earners.
Source: Channel News Asia – http://www.channelnewsasia.com/stories/singaporebusinessnews/view/1255879/1/.html