Malaysia, Singapore and Indonesia in talks on new special economic zone

KUALA LUMPUR: A new trilateral initiative between Malaysia, Singapore and Indonesia is taking shape, with the three neighbours in talks to establish a Special Economic Zone (SEZ) that could deepen Asean’s regional integration and revitalise cross-border investment opportunities.

Singapore Deputy Prime Minister Gan Kim Yong said the cooperation has the potential to link three strategic regions — Johor, Batam-Bintan-Karimun (BBK) and Singapore — thereby strengthening Asean’s goal of achieving regional economic integration and fostering a more inclusive growth ecosystem.

Gan, who is also Singapore’s Minister for Trade and Industry, said preliminary discussions have already begun among the three countries to explore new areas of cooperation that could bring mutual benefits.

“We are thinking about how the three parties can work together. So when we promote investment in this region, it will no longer just be about coming to Singapore or Johor, but to the Singapore–Johor–BBK region as a whole.

“Between Singapore and Johor, we already have the JS-SEZ, and between Singapore and Indonesia, we have our cooperation with BBK. Now, we want to see how the three sides can together create greater value.

“The main goal of this trilateral cooperation is to generate stronger added value and offer broader investment potential for the mutual benefit of all three countries,” he said when met at the 47th Asean Summit here today.

When asked when the SEZ involving the three regions could materialise, Gan said discussions have already begun, but there are no specific details yet as the idea remains at an early stage.

He added that the integration would provide investors with more options — whether to operate solely in Singapore, in Singapore and Johor, in Singapore and Batam, or in Batam and Johor — making the region a more attractive and competitive investment destination.

Gan said he believes that the opportunities and choices offered to investors and businesses will be far more appealing, and the added value will continue to grow.

“We can all see the value in this cooperation, even though it is not an easy process. Managing bilateral cooperation is already challenging, but this trilateral effort is still vital to create broader economic synergy.

“This is an example of how, through Asean relations, we have learned to work together and become more comfortable with one another. This is how we can generate shared benefits,” he said.

The idea of a three-region partnership was first introduced in the early 1990s under the Sijori Growth Triangle,which brought together Singapore, Johor and the Riau Islands as an initiative to leverage the economic strengths of the three areas.

Under the Sijori framework, Singapore played the role of financial and technology hub, Johor served as an industrial and logistics base, while the Riau Islands — particularly Batam and Bintan — functioned as manufacturing and tourism zones.

The combination of these strengths formed a complementary economic ecosystem, making the region one of the most dynamic growth zones in Southeast Asia at the time.

However, in the decades that followed, the Sijori concept lost momentum due to changing economic policies and shifting national priorities in each country.

© New Straits Times Press (M) Bhd

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