Speech by Lim Guan Eng at the private screening of the habitat documentary film - "Urbanized" at GSC, Gurney Plaza, Penang on Thursday, 19^th April 2012 at 11 am: 

Penang proposes to increase the minimum limit for foreign purchases of all properties 

I would like to welcome all of you to this screening of the documentary “Urbanized” by Gary Hustwit, brought to you today by Penang Institute in conjunction with Think City.

This new documentary film is currently being screened and discussed in many places around the world. Not only does this film highlight many of the serious challenges that face an increasingly urban world, it also shows how some of these problems are addressed.

Over half the world’s population now live in urban areas, and 75% will call a city home by 2050. However, while cities comprise less than 1 percent of the earth's surface, they generate 75 percent of its greenhouse gas emissions.

In the context of an ever-expanding urban population, issues such as increasing cost of energy and climate change will result in greater competition for our declining resources. Hence, many of the urban challenges we face can only be resolved by changing the way we plan, build and manage our cities and urban areas.

Cities have always been sites of innovation and incubators of creativity. It is the flow of people, goods, energy, information and services that determine whether a city becomes a destination and habitat of choice. Therefore, the current set of challenges can be viewed as an opportunity for cities to forge a path that is more sustainable and driven by innovative ideas, new technologies and the creativity of its people.

This film will show us how other cities around the world are addressing their urban challenges, and through that perhaps it will also provide a lens for us to approach some of the issues that we face here in Penang.

After the film, we have a distinguished panel of professionals made up of planners, politicians, academics and urbanists who will provide their reactions to the film. Discussions on this issue are timely, and even more critical that it involves a broad range of stakeholders like what we have here today, from NGOs to members of local authorities to professional architects, planners and developers. All of you are responsible for the planning and development of our city and state and thus it is important that we are aware of the challenges of the modern world.

It is my hope that the following film will inspire ideas on how we go about planning together, to make Penang not only the most sustainable and liveable city in Malaysia and the region, but also to achieve our collective goal of becoming an international and intelligent city of the future.

There are 3 pressing habitat issues in Penang that requires urban solutions that offers sustainable development. One is traffic congestion. Unfortunately traffic congestion in Penang as a result of policy failure and leadership apathy and neglect over the previous 18 years, can not be overcome overnight.

The state government through the 2 local authorities of Majlis Perbandaran Pulau Pinang(MPPP) and Majlis Perbandaran Seberang Perai(MPSP) had undertaken:-

• short-term measures of forcible clamping and removal of vehicles that block traffic, synchronization of traffic lights and redirection of traffic flows;

• medium-term measures of widening roads and building lay-bys and connecting roads to widen transport accesses;

• long-term measures of at least 4 major infrastructure structures project to provide four lane highways to connect heavily congested areas, including a 3 rd link between Gurney Drive and Butterworth through Malaysia's first underground sea tunnel.

The Penang PR state government has also help to fund the RM3.2 millon Penang Transport Master Plan(PTM). Even though 2 proposals are mooted by the transport consultants, certain irresponsible parties appear to blame the state government for either ignoring the PTM or not developing public transport.

The Penang state government agrees that public transport is the most coherent and effective method to reduce traffic congestion in line with the principle of moving people, not vehicles. Unfortunately the state government has no control over public transport which is a Federal jurisdiction. So powerless is the state government that we have no powers to impose meters on taxis or even ask buses to provide for free bus services paid by the state government.

The PTM consultants realizes the limits of state government's powers and is making two proposals,

1. a RM13 billion balanced public transport option assuming full co-operation and assistance from the Federal government; and

2. a RM12.5 billion highway option as a fall-back position of 7 highways, including the state government's 4 infrastructure projects, in the event federal co-operaton and assistance is not forthcoming. So far, the Federal government has not fulfilled its promised monorail/tram or road by-pass as promised before the 2008 general elections.

In other words, the traffic consultants' 7 proposed highways is more than the 4 proposed by the state governments.

Two, habitat protection requires rigorous enforcement and restrictions on hillslope development. The PR state government is proud of our record of not approving any hillslope development and has asked the local authorities to ensure compliance. I have been informed by the two local authorities that any hillslope developments are either approved are undertaken by the previous state government.

Unfortunately, such approvals given by the previous state government is still in legally in force and the procedures that follow from such approvals usually can not be stopped. As a rules-based government, the present state government has to observe the laws and respect approvals given, even though it is from the previous state government. Again those who try to pin the blame on the state government for any hill-slope development should explain why they gave approvals in the first place.

Thirdly provide affordable housing. The PR Penang State government will be outlining a complete and holistic framework of providing affordable housing to Penangites involving not just the government but also the private sector. For the past four years, the state government has saved and gathered funds. An initial sum of RM500 million and free land has been provided for this purpose with the first project of 12,000 units in the new satellite town of Batu Kawan. More of such affordable projects will be proposed, including on the island of Penang.

As a first step to protect the interests of local Malaysians, the state government is proposing to increase the minimum limit for foreign purchases of all properties from the existing level of RM 500,000 to RM1 million with a higher limit of RM 2 million for landed properties only in Penang island and retaining the present RM 500,000 limit for Permanent Residents.

In 2010 and 2011 there were 774 and 890 property transactions involving foreigners. These transactions constitute only 2.98% and 2.26% respectively of the total number of transations in Penang. However to protect the interests of locals to ensure that they enjoy priority for less expensive properties, this restriction will help to provide a level playing field since foreigners have the advantage of a higher currency.

The Penang state government stresses that we welcome foreign participation in our economy including our property market. The state government feels that foreign participation can be profitable to both Penangites and foreigners in the higher end market where they can add value by helping Penang to transform itself into an international and intelligent city.

We would like to get feedback and opinions from NGOs, property developers, foreigners and the public on this proposal. The state government hopes to implement this proposal the earliest by 1 June 2012 or the latest by 1 July 2012.

*Lim Guan Eng, Penang Chief Minister