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Malaysian Reserve
4 days ago
- Business
- Malaysian Reserve
ECRL: Remapping the nation's growth engine
It would reshape Malaysia's logistics corridors, attract new investment and rebalance regional development by HIDAYATH HISHAM & SUFEA SALEHUDDIN THE East Coast Rail Link (ECRL) is shaping up to be more than just a railway. Beyond connecting the east coast to Selangor, the project is being positioned as a force of national growth — one that could reshape Malaysia's logistics corridors, attract new investments and rebalance regional development. As of June, the 665km alignment has reached 82.45% completion, according to Transport Minister Anthony Loke. Yet, experts say the railway's true success will hinge on more than construction milestones. (graphic: TMR) Coordinated Strategy, High-impact Zones Investor activity along the ECRL corridor is gaining tangible momentum, backed by confirmed projects and rising interest, particularly in Pahang and across the East Coast Economic Region (ECER), according to the Malaysian Investment Development Authority (MIDA). 'This growing momentum is the result of deliberate strategy, strong inter-agency collaboration at both federal and state levels, and tangible infrastructural progress,' MIDA said in a written statement to The Malaysian Reserve (TMR). MIDA said the project remains on track to reach 90% completion by year-end, with full operations expected in 2027. The progress has catalysed logistics expansion, industrial development and rising land values. It has established a dedicated task force with the ECER Development Council (ECERDC) and China Communications Construction Co Ltd (CCCC) to promote and facilitate Economic Accelerator Projects (EAPs) along the corridor. These include transit-oriented developments (TODs), industrial parks and logistics hubs in key areas. Nearly RM20 billion has been invested in Kuantan and the Malaysia-China Kuantan Industrial Park (MCKIP), focusing mainly in high-value manufacturing, processing and logistics. The Malaysia-China Kuantan International Logistics Park (MCKILP) is expected to bring in up to RM17.61 billion in foreign direct investment (FDI) and create 20,000 jobs in industries like light and medium manufacturing, warehousing, housing, petrochemicals, steel, palm oil processing, e-commerce and marine engineering. Most investment is focused in high-tech manufacturing, logistics and transport, tourism, hospitality and commercial services. MIDA said it supports these sectors through investor facilitation, feasibility guidance and close engagement with local and state authorities. 'While initial investments have focused on developed areas like MCKIP, the broader ECRL corridor is envisioned to enable balanced development, expanding opportunities to less-developed areas in Terengganu, Kelantan and central Pahang.' Sector Priorities, Catalytic Zones MIDA is focusing on key industries like logistics, green technology, and agro-based sectors near transit-oriented developments (TODs). The ECRL aims to boost east-west trade and speed up industrial growth. Economic Accelerator Projects (EAPs) are open to all investors and concentrate development within a 15km radius or 30-minute drive of ECRL stations. The main focus areas are Kuantan Port City for logistics and manufacturing and central Pahang towns such as Temerloh and Bentong for industrial parks and TODs. Other sites include Kuala Terengganu, Cherating, Kota Sultan Ahmad Shah (Kota- SAS) and Bandar Permaisuri, all under a broader Integrated Land Use Master Plan (ILUMP). 'A new international airport will be developed in the Cherating area. The Cherating Station, currently passenger-only, is planned by the Pahang state to add cargo facilities to support the growing aerospace industry nearby,' MIDA said. KotaSAS, meanwhile, is being developed as a new township and administrative capital for the state government. It currently serves passengers only. Incentives, Promotion and Long-term Positioning MIDA globally promotes key zones like Kuantan Port City under the Belt and Road Initiative (BRI) and offers full support to investors, including site scouting, licensing, land access, incentives and utilities. It coordinates closely with agencies like the Town and Country Planning Department (PLANMalaysia) and state governments to ensure infrastructure and talent readiness. Under the BRI, MIDA promotes the ECRL as a key advantage for investors, linking Port Klang and Kuantan Port to enhance trade by avoiding congested sea routes. Incentive Framework Boosts Enabling Environment The agency said the ECRL is a major incentive, offering strong connections between Malaysia's east and west coasts. It is also collaborating with government agencies to develop competitive incentive packages for EAPs. The government plans to launch a New Investment Incentive Framework in the third quarter of 2025 (3Q25), aimed at encouraging high-value activities and reducing economic differences between regions. 'ECRL aims to boost economic growth, create jobs and support balanced regional development, but its success relies on fair benefit distribution and effective integration with local economies.' ECRL achieves another milestone with the record-breaking breakthrough of the 16.4km Genting Tunnel. Loke (centre) says the completed tunnel is expected to be the longest railway tunnel in South-East Asia Railway History Hints at ECRL's Future Impact Monash University Malaysia senior economics lecturer and Honours/Postgraduate Diploma director Dr Audrey Siah pointed to early railway stations like Taiping in Perak, helped form industrial clusters and boosted nearby towns such as Matang. Citing her co-authored study Colonial Origins of Agglomeration, she said the ECRL could create similar economic ripple effects as past railway developments. 'It is essential to address this potential backwash effect, where areas with stations attract economic resources such as labour, capital and trade, at the expense of areas without stations,' she told TMR. Smaller towns like Kuala Lipis, Jerantut, Kuala Krai and Gua Musang could be developed into feeder points for ECRL-linked logistics. For example, the timber and wood products manufacturing and the agro-based food processing industries in Mentakab, Pahang, could flourish due to its access to cities and ports on the West Coast. Siah said improved connectivity will reduce logistics costs, boost investor confidence and make the East Coast more attractive for sectors such as agriculture, manufacturing and export logistics. While ECRL's strategic link between Kuantan Port and Port Klang may appeal to Chinese investors, deeper BRI integration must not sideline local firms. 'If foreign firms dominate business operations and supply chains, Malaysia risks missing critical opportunities for SME participation and local capacity building. 'Another potential risk is an eventual influx of cheaper Chinese goods and services, which could undercut — and ultimately stunt — the growth of Malaysian SMEs in competing sectors,' Siah said. Still, she believes the benefits outweigh the risks. 'To fully benefit from the ECRL, SMEs should position themselves near key stations or industrial hubs along the rail corridor to take advantage of improved connectivity and reduced transportation costs. 'These efforts, part of the ECRL-EAP, offer significant opportunities for SMEs to participate in and benefit from the broader economic transformation,' she added. To benefit from ECRL, SMEs should set up near key stations or industrial hubs along the rail line, says Siah (Source: Kuantan's Strategic Anchor The Kuantan segment of the ECRL stands out as a strategic linchpin in Malaysia's east-west connectivity. Universiti Malaya (UM) Department of Finance, Faculty of Business and Economics Assoc Prof Dr Mohd Edil Abd Sukor believes the corridor's development hinges on how well its infrastructure is integrated with freight logistics and industrial nodes — particularly Kuantan Port and MCKIP. He said Kuantan Port City 1 and 2, and Cherating are strategically positioned to drive regional growth by enhancing mobility, boosting tourism and strengthening Kuantan's role as a key logistics hub linked to Kuantan Port and MCKIP. While the ECRL's capital cost remains significant, Mohd Edil said the long-term returns can be realised if economic activity is stimulated around key freight corridors. Freight operations at Kuantan Port City 2, in particular, are projected to be a major revenue source. 'Over time, the multiplier effects on employment, local businesses and real estate are expected to support a positive return on investment,' he told TMR. But for this to materialise, he said the infrastructure must be closely linked to surrounding industrial activity, with clear freight incentives, efficient customs procedures and strong intermodal planning. Balancing Development, Managing Fiscal Risk Beyond the East Coast, Mohd Edil sees the ECRL as an opportunity to address Malaysia's persistent east-west economic imbalance. By connecting less-developed states to key urban markets, the rail line could attract capital into logistics, tourism and manufacturing in areas long neglected by mainstream investment flows. Improved logistics connectivity lowers the cost of moving goods, widens access to urban markets and increases investor confidence. For governments, this can translate into higher tax revenue, while firms benefit from reduced entry barriers. Over time, Mohd Edil expects private investment to cluster around stations such as Kuantan Port City 2 — particularly in sectors with existing momentum such as heavy industry, warehousing and real estate. However, he warns of key macroeconomic risks. 'One of the primary risks is its heavy reliance on foreign loans, particularly from a Chinese bank serving as the project's main financier. This exposes Malaysia to currency exchange risk, especially if the ringgit depreciates against the yuan or US dollar,' he said. Even if the loan terms are favourable — such as longer maturities and relatively low interest rates — Malaysia remains vulnerable if revenue projections underperform or freight traffic fails to materialise at scale. In such a case, debt servicing could strain public finances. Mohd Edil urged policymakers to manage currency and operational risks through efficiency, industrial integration and robust oversight to ensure that project benefits are delivered on the ground. Mohd Edil sees the ECRL as an opportunity to address Malaysia's persistent east-west economic imbalance (Pic courtesy of Mohd Edil Abd Sukor) Financial Inclusion, Regional Capital Market Spillovers Beyond infrastructure and logistics, ECRL could unlock broader financial participation in rural areas. 'As commerce and mobility increase, financial institutions may be more inclined to expand their branch networks or digital outreach in these areas, especially in underserved towns, improving access to credit and savings facilities for local entrepreneurs, smallholders and informal businesses,' Mohd Edil added. This shift could stimulate asset ownership, financial literacy and broader participation in Malaysia's formal economy, especially in areas like Jerantut, Kuala Lipis and interior Kelantan. At the national level, ECRL also provides opportunities for capital markets. As a BRI flagship, the project signals Malaysia's readiness to support large-scale infrastructure finance — including sukuk issuances, public-private partnerships and cross-border deals — making it a platform to attract international investors into BRI-linked projects. With the right incentives, ECRL could trigger financial innovation, ranging from syndicated infrastructure bonds to new financing models via Labuan, Sabah. Building Rail Talent Through Local Upskilling ECRL's operation phase is expected to create about 1,800 jobs. In May, Loke said ECRL Operation Sdn Bhd, a joint venture (JV) between Malaysia Rail Link Sdn Bhd and CCCC, will manage the workforce, with operations scheduled starting in January 2027. He said at least 80% of the workers will be Malaysians in technical and operational roles. To meet this demand, the government is expanding the Program Latihan Kemahiran Industri ECRL (PLKI-ECRL) to include operations and maintenance (O&M) training. Launched in 2017, the programme is entering its next phase, targeting 3,200 local talents specifically for O&M roles. This year, 210 Malaysians will undergo a one-year intensive programme in Liuzhou, China, with the first 102 trainees having departed in May. Trainees will be prepared for roles including assistant station attendant, signalling technician, assistant train driver, overhead line technician, and emu maintenance technician. Loke also guaranteed employment for all PLKI-ECRL upon completion of the programme. 'The effort to develop the capability and competence of our local youth is a priority, so that Malaysia will not have to depend on foreign expertise in the long term,' he said. CCCC has contributed RM12 million to support the training programme, which forms part of its investment in developing a sustainable and localised rail workforce. From freight logistics and financial inclusion to SME development and industrial spill-overs, the ECRL's impact will depend on how well it is integrated into the real economy — and whether the gains it promises reach surrounding communities. This article first appeared in The Malaysian Reserve weekly print edition
BusinessToday
21-07-2025
- Business
- BusinessToday
86% And Counting, PM Slams Claims Of ‘No Results'
Credits to PMO FB Prime Minister Datuk Seri Anwar Ibrahim has dismissed claims that multibillion-ringgit investments bring no tangible results, stating that the manufacturing sector continues to deliver direct benefits to Malaysians through job creation, wage increases and industrial value-add. 'They say billions in investments, where are the results? There's nothing to show. The reality is, 86% of the approved projects are already operational,' he said. He revealed that 3,494 manufacturing projects have been approved by the Malaysian Investment Development Authority (MIDA) from 2021 until June 2025. Of these, 3,095 projects or 86.4%, have been realised and are now operational. Speaking at the monthly assembly of the Prime Minister's Department, Anwar noted that the implementation rate of approved projects stood at 90.6% in 2023, 79.2% in 2024 and 49.8% in the first quarter of 2025. 'I've told Minister Tengku Zafrul to continue publishing the relevant data and highlight the locations of operating plants — in Kulim, Johor, Sarawak, Sabah and the Klang Valley,' he added. He said most of the realised projects focus on digital and green industries. In the first quarter of this year alone, these projects have created 50,000 new jobs in the manufacturing sector. Median wages in the sector also rose by 5.4% to RM2,745, up from RM2,600 last year, aligning with the new minimum wage policy of RM1,700. Anwar also reported that since the establishment of the Invest Malaysia Facilitation Centre (IMFC) in December 2023, a total of 28,166 investor applications have been facilitated with a resolution rate of 99.9%. These applications involved matters such as approvals, permits, foreign worker quotas, utilities and tax-related issues. Related
The Sun
21-07-2025
- Business
- The Sun
Anwar refutes claims of failed multibillion-ringgit investments
PUTRAJAYA: Prime Minister Datuk Seri Anwar Ibrahim has firmly rejected allegations that multibillion-ringgit investments in Malaysia have failed to deliver results. He stressed that these investments, particularly in the manufacturing sector, have significantly contributed to economic growth, job creation, and wage improvements. Anwar revealed that 3,494 manufacturing projects approved by the Malaysian Investment Development Authority (MIDA) between 2021 and June 2025 have seen an 86.4% implementation rate, with 3,095 projects already operational. The annual implementation rates were 90.6% in 2023 and 79.2% in 2024, while the first quarter of 2025 recorded 49.8%. 'Critics ask, 'Where are the results of these billions in investment?' The truth is, 86% of approved projects are up and running,' Anwar stated during the Prime Minister's Department monthly assembly. He directed the Minister of Investment, Trade and Industry, Tengku Datuk Seri Zafrul Abdul Aziz, to publicly share data on operational projects in key regions like Kulim, Johor, Sarawak, Sabah, and the Klang Valley. The prime minister emphasised that these projects, particularly in digital and green industries, have generated 50,000 new jobs in the manufacturing sector in Q1 2025. Additionally, the median wage in the sector rose by 5.4% to RM2,745, aligning with the new minimum wage of RM1,700. Anwar also highlighted the efficiency of the Invest Malaysia Facilitation Centre (IMFC), established in December 2023, which has processed 28,166 investor applications with a 99.9% resolution rate. These applications covered approvals, permits, foreign worker quotas, utilities, and taxation. 'The civil service's role in facilitating these investments must be acknowledged. Their efficiency ensures that announced policies translate into real outcomes,' he added. – Bernama
Barnama
21-07-2025
- Business
- Barnama
Claims Multibillion-ringgit Investments Failed Are Baseless
BUSINESS PUTRAJAYA, July 21 (Bernama) -- Prime Minister Datuk Seri Anwar Ibrahim has dismissed claims that multibillion-ringgit investments have not produced any results. He emphasised that investments in the manufacturing sector continue to have a positive impact on the national economy, with the benefits being directly felt by the people through increased job opportunities, higher wages, and greater value added to industries. Anwar said that 3,494 manufacturing investment projects had been approved by the Malaysian Investment Development Authority (MIDA) from 2021 to June 2025, of which 3,095 projects, or 86.4 per cent, had been realised and are now operational. He noted that the overall annual implementation rate of these approved projects stood at 90.6 per cent in 2023 and 79.2 per cent in 2024, while for the first quarter of 2025, the implementation rate was 49.8 per cent. 'They say, 'billions in investment, but where are the results? There is nothing to show'. In reality, 86 per cent of the approved projects are already operational. 'As such, I have informed the Minister of Investment, Trade and Industry Tengku Datuk Seri Zafrul Abdul Aziz to continue displaying this data and to highlight the locations of these operational projects in Kulim, Johor, Sarawak, Sabah, and the Klang Valley,' Anwar said in his speech at the Prime Minister's Department (PMO) monthly assembly here today. He said the majority of these realised projects are in the manufacturing sector, with a focus on digital and green industries. Anwar highlighted that the implementation of these projects had created 50,000 new job opportunities in the manufacturing sector in the first quarter of 2025. During the same period, the median wage in the manufacturing sector increased by 5.4 per cent to RM2,745, compared to RM2,600 last year, in line with the implementation of the new minimum wage of RM1,700.
Yahoo
14-07-2025
- Business
- Yahoo
Output to Register an AAGR of 4.4% During 2026-2029, Supported by Investments in Manufacturing and Mixed-use Projects, & NIMP 2030
The Malaysian construction industry is set to grow 6% in 2025, driven by infrastructure investments, with 1,049 projects worth MYR58.8 billion in the pipeline. The 2025 budget allocates funds for key sectors, contributing to growth. "Construction in Malaysia - Key Trends and Opportunities to 2029" offers detailed insights. Dublin, July 14, 2025 (GLOBE NEWSWIRE) -- The "Malaysia Construction Market Size, Trends, and Forecasts by Sector - Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential Market Analysis to 2029 (Q2 2025)" report has been added to construction industry in Malaysia is expected to expand by 6% in real terms in 2025, supported by investments in industrial and transport infrastructure projects. According to the Department of Statistics Malaysia (DOSM), the total value of construction work done grew by 16.6% YoY in Q1 2025. By sector, the total value of residential construction work done grew by 27%, while that for non-residential buildings and civil engineering works grew by 21.1% and 3.7%, respectively, during Q1 2025. Moreover, according to the Malaysian Investment Development Authority (MIDA), the government has 1,049 projects in the pipeline, worth a total of MYR58.8 billion ($13.3 billion). The services sector dominates the pipeline with 995 projects, worth MYR31.8 billion ($7.2 billion), while the manufacturing sector accounts for 54 projects worth MYR27.0 billion ($6.1 billion). Growth in 2025 will also be supported by allocations announced as part of the 2025 Budget, under which, MYR64.1 billion ($14.4 billion) is allocated for the Ministry of Education, MYR45.3 billion ($10.2 billion) for the Ministry of Health, MYR10 billion ($2.3 billion) for the Ministry of Housing, and MYR16 billion ($3.6 billion) for the Ministry of Energy. The construction industry is expected to register an annual average growth rate of 4.4% between 2026 and 2029, supported by investments in manufacturing and mixed-use projects, coupled with support from the New Industrial Master Plan 2030 (NIMP 2030), announced in 2023; as part of the plan, the government will invest MYR5 billion ($1.1 billion) to develop 3,000 smart factories in the country by 2030. In March 2025, the Malaysian commercial banking company, Maybank, reported that the country's Johor state is poised to receive up to MYR2.4 billion ($540.8 million) in investments over the next three to ten years, focused on the Johor-Singapore Special Economic Zone (JS-SEZ).Scope Historical (2020-2024) and forecast (2025-2029) valuations of the construction industry in Malaysia, featuring details of key growth drivers. Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline. Listings of major projects, in addition to details of leading contractors and consultants Reasons to Buy Identify and evaluate market opportunities using our standardized valuation and forecasting methodologies Assess market growth potential at a micro-level with over 600 time-series data forecasts Understand the latest industry and market trends Formulate and validate business strategies using the analyst's critical and actionable insight Assess business risks, including cost, regulatory and competitive pressures Evaluate competitive risk and success factors Key Topics Covered: 1 Executive Summary2 Construction Industry: At-a-Glance3 Context3.1 Economic Performance3.2 Political Environment and Policy3.3 Demographics3.4 Risk Profile4 Construction Outlook4.1 All Construction Outlook Latest news and developments Construction Projects Momentum Index 4.2 Commercial Construction Outlook Project analytics Latest news and developments 4.3 Industrial Construction Outlook Project analytics Latest news and developments 4.4 Infrastructure Construction Outlook Project analytics Latest news and developments 4.5 Energy and Utilities Construction Outlook Project analytics Latest news and developments 4.6 Institutional Construction Outlook Project analytics Latest news and developments 4.7 Residential Construction Outlook Project analytics Latest news and developments 5 Key Industry Participants5.1 Contractors5.2 Consultants6 Construction Market Data7 AppendixFor more information about this report visit About is the world's leading source for international market research reports and market data. We provide you with the latest data on international and regional markets, key industries, the top companies, new products and the latest trends. CONTACT: CONTACT: Laura Wood,Senior Press Manager press@ For E.S.T Office Hours Call 1-917-300-0470 For U.S./ CAN Toll Free Call 1-800-526-8630 For GMT Office Hours Call +353-1-416-8900Sign in to access your portfolio
