Andrew Harding, Centre for Asian Legal Studies, National University of Singapore
Relevance of the Practice
Development has been a major preoccupation since independence in 1957. Typically of Asia’s developmental states, of which Malaysia is a good example, centres of autonomy have been the object of persistent, although not wholly successful, attempts to subordinate them to the developmental aims of successive federal governments, as well as marshalling virtually all branches of the state as well as private interests behind the development agenda.[1] In this process, the federal government has experimented with what one might call the spatial geography element in development by finding ways of using the territory under its ultimate control (noting that land itself is nonetheless a state matter) to spark economic activity. Examples are the creation of the Multimedia Super-Corridor and Cyberjaya as Asia’s answer to Silicon Valley, and the moving of the federal government itself to a new capital at Putrajaya in the same area, to the South of Kuala Lumpur, linking with Kuala Lumpur International Airport.[2] These projects, in an exercise of political power at the federal level, in effect overrode both state and local governments’ powers. In addition, the federal government has experimented with growth corridors, growth triangles, special economic zones, development authorities, and development regions. This study examines Iskandar Development Region Authority/ ‘Iskandar Malaysia’ (IDRA-IM) as an example of how new structures might serve development purposes and potentially alter the nature and ultimately the structure of local government.
Description of the Practice
The federal government established the IDRA-IM in 2007. Its five territories of operation overlap geographically with that of local authorities in the region, mainly the city councils of Johor Bahru (MPJB) and Iskandar Puteri (MPIP). IDRA-IM is located at the very southernmost tip of the entire Eurasian land mass, with Singapore just one kilometre away across the strait that separates it from the State of Johor. The location is strategic as part of a growth triangle between Malaysia, Singapore and Indonesia, although the Indonesian element in this project has proved minor.
IDRA-IM’s main purpose is to attract investment into the region by cooperation both between federal, state and local governments, and with other countries, especially Singapore. As a former Chief Minister of Johor put it, ‘be they local or foreign direct investments from all sources including Singapore, it is the [IM] which will have jurisdiction over issues pertaining to investments’.[3]
Technically this statement is incorrect, as legal jurisdiction still lies with the relevant authorities. The practice developed here is that of defining the powers of IDRA-IM (and it is an acknowledged model not just for Malaysia but for the entire Southeast Asian region) as those of advising the state and local government authorities on investment, not usurping their powers.
Under Section 4 of the 2007 act, the objective of IDRA-IM is to ‘develop the region into a strong and sustainable metropolis of international standing’. Its precise functions, defined extensively in Section 5, are essentially in brief to develop policies and plans for development, and give advice to the decision-makers. Since it is co-chaired by the Prime Minister and the Chief Minister of Johor, and the Finance Minister is also a member, its influence is obviously very strong, despite its lack of legal powers. The Sultan of Johor also has much influence over its activities and takes a keen interest.[4] The mayors of the city councils sit on IDRA-IM’s Advisory Committee, so the local authority also has a strong say in deliberations.
As an official interviewed in one study of IM in 2015 stated:
‘We adopt a persuasive strategy because the final decision goes to the local council and the Johor state. Sometimes they have their own plans, and sometimes they have their hands tight [sc. tied] because there is someone bigger behind them, so it is not a forward straight engagement.’[5]
Assessment of the Practice
The structure indicated fulfils the purposes of bringing resources and expertise to bear on galvanising development in a region of large potential growth, creating a space for policy innovation, for example on climate change,[6] while leaving undisturbed the normal process of local government decision-making. The local authorities have of course many areas and many functions lying beyond IDRA-IM’s interests.
Although there are acknowledged risks and difficulties to be negotiated, the structure adopted departs from the previous developmental strategy of override to engage with dialogue and consultation and has met with practical success in attracting investment, which was however slower in coming than was anticipated at the outset. Most investment comes from China and Singapore.
References to Scientific and Non-Scientific Publications
Nadalutti E, Regional Integration and Migration in Southeast Asia: The Rise of “Iskandar-Malaysia”’ in Leila S Talani and Simon McMahon (eds), The Handbook of the International Political Economy and Migration (Edward Elgar 2015)
DBS Asian Insights, ‘Iskandar Malaysia, a Tale of Two Cities’ (DBS Group Research 2013) <https://www.guppyunip.my/SectorBriefing01_IskandarMalaysia.pdf>
[1] Andrew Harding, The Constitution of Malaysia: A Contextual Analysis (Hart Publishing 2012) Chapter 2.
[2] Michael Likosky, The Silicon Empire: Law, Culture and Commerce (Routledge 2005).
[3] Datuk Abdul Ghani Othman, quoted in Elisabetta Nadalutti, ‘To what Extent Does Governance Change because of Sub-Regional Cooperation? The Analysis of Iskandar Malaysia’ (2016) 19 International Relations of the Asia-Pacific 1. See also Agatino Rizzo and John Glasson, ‘Iskandar Malaysia’ (2012) 29 Cities 417; Elisabetta Nadalutti, ‘Regional Integration and Migration in Southeast Asia: The Rise of “Iskandar-Malaysia”’ in Leila S Talani and Simon McMahon (eds), The Handbook of the International Political Economy and Migration (Edward Elgar 2015) 399.
[4] Nadalutti, ‘To what Extent Does Governance Change because of Sub-Regional Cooperation?’ 22-5.
[5] ibid. 20. Contrary to the examples of public participation in the drafting of development plans outlined under section 6, on the specific project of the Iskandar Development Region there is no public participation.
[6] Jose de Oliveira, ‘Intergovernmental Relations for Environmental Governance: Cases of Solid Waste Management and Climate Change in two Malaysian States’ (2019) 233 Journal of Environmental Management 481.