The Northern Corridor Economic Region (NCER) marginalises Penang as the Federal Government has neither stated how much of the RM 177 billion investment will be earmarked for Penang

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Press Statement

by Lim Guan Eng

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(Petaling Jaya, Tuesday): Prime Minister Datuk Seri Abdullah Ahmad Badawi has identified three main thrusts of agriculture, manufacturing and services for the promotion of balanced and equitable national economic development. Abdullah said that the NCER requires RM 177 billion in investments over the next 19 years. Two-thirds of the investments would come from the private sector and the Government would invest RM 5 billion to implement programmes in the initial stages.  

The question is how much of this RM 177 billion in investment is earmarked for Penang and the other states. Unless the government gives a breakdown, the NCER marginalizes Penang, as the main thrust of agriculture is not the comparative and competitive advantage for Penang. 

Compared with Johor’s Iskandar Developlment Region(IDR) which targets RM 50 billion over the first five years and RM 383 billion target over 20 years, the NCER and Penang has clearly lost out in the race for foreign investment. In contrast to Johor alone getting RM 50 billion over 5 years and RM 383 billion over 20 years, the RM 177 billion is to be divided over four states of Kedah, Perlis, Perak and Penang. 

Penang Chief Minister Tan Sri Dr Koh Tsu Koon should fully explain how Penang is going to benefit in ringgit and cents and not distract attention with obscure speeches. Better still he should be prepared to engage in a public debate on the economic performance and potential of Penang on how to regain its position as the most developed state in Malaysia. 

Furthermore the NCER is driven by agriculture unlike the IDR which is driven by foreign investment. Whilst the implementation of IDR is under the personal supervision of the Prime Minister, the NCER is handled by a GLC, Sime Darby.  

How much Penang loses out can be seen by the Johor a total of RM 2,489 million comprising domestic investment of RM 879 million and foreign investment of RM 1,610 million in the manufacturing sector for the first three months of 2007. Penang pales in comparison with only RM 178 million comprising RM 81 million in domestic investment and RM 97 million in foreign investment. The difference in investor interest and importance between IDR and NCER or between Johor and Penang can be seen by the difference of investment between RM 2,489 million and RM 178 million! (see table below) 

Sime Darby is too busy involved in creating the largest listed palm oil firm in the world. The RM 30 billion merger between GLCs, Sime Darby, Golden Hope Plantations and Kumpulan Guthrie into Synergy Drive Bhd will see it being listed in November as the second-largest company on Bursa Malaysia with a market capitalisation of about RM48.5 billion. Besides the main three companies, the five other related companies involved in the merger are Guthrie Ropel Bhd, Highlands & Lowlands Bhd, Mentakab Rubber Company (Malaya) Bhd, Sime Engineering Services Bhd and Sime UEP Properties Bhd. 

Upon completion of the merger, Synergy Drive is expected to have a combined workforce of about 107,000 people. Will Sime Darby be focused on the NCER when they are busy combining the three large firms and 5 smaller firms into one productive entity?