Singapore-Malaysia border crossing (update 10): Johor Baru-Singapore Rapid Transit System in Dec 2024

21 Jan 2018:  Johor Baru-Singapore Rapid Transit System in Dec 2024

Dec 2024: Johor Baru-Singapore Rapid Transit System to carry 10,000 passengers per hr per direction; need to clear customs only once

26 Oct 2017: Commentary by Khor Yu Leng

Johor views of the rising cross-border tolls with Singapore by Khor Yu Leng, 26 Oct 2017

The busiest land crossing in the world has been adjusting to and absorbing “tit-for-tat” fees escalation since 2014

The Johor-Singapore land crossing is described as one of the busiest in the world. Johor authorities reported an average of about 296,000 daily pedestrians in 2015. This figure excludes those using motorcycles (about 100,000 registered for automated clearance), cars, vans, lorries and buses. The data is a bit patchy, but reports point to 126,000 vehicles daily (including about 4,000 trucks and lorries entering Singapore) just on the kilometre-long Causeway built in 1923; whilst the Second Link has capacity for 200,000 per day. Overall this implies at least a quarter million commuters.

Compare this with the US-Mexico San Ysidro border crossing (connecting San Diego and Tijuana), which has 50,000 cars and 25,000 pedestrians entering the US daily. While San Ysidro (35 minutes to cross in a standard lane, may be faster) is often thought of as the busiest land crossing in the world, the statistics suggest that the Causeway has it beat.

Many on a daily commute are Malaysians seeking higher paying jobs in Singapore. To earn incomes that can be three-times higher than if they worked in Johor, hundreds of thousands of people make daily 180-240 minute (return) commutes across the congested Causeway and Second Link bridges. This includes widespread anecdotes of an added 60 minute daily wait times at immigration in recent years.

Swelling the massive commuting traffic are Singaporeans whose strong currency takes them a long way in Johor. This brings weekend and holiday car traffic that go for essentials of shopping, foot massages and a car wash. No surprise that some Johor workers in Singapore say they don’t bother to return home until late every Friday night!

Malaysia’s VEP registered 20,000 Singapore cars by October 2015. While there were complaints on higher crossing fees and talk about reducing trips, Johor experts and a mall owner I checked in with report no impacts. Basically, Singapore drivers get used to paying a bit more within a month or two, and things are “business as usual” for those catering to their trade. Property gurus point to more new retail outlets in Johor including a new Aeon in September, Ikea and Paradigm Mall in November, and Mid-Valley at South Quay.

Johor observers point to the start of competitive fees hikes in 2014 on passenger car traffic, with Singapore increasing its Vehicle Entry Permit (VEP) from SGD20 to SGD35 per day. In reaction the Barisan Nasional government did not honour its 2013 general election pledge not to charge toll fees on the Johor Bahru Eastern Dispersal Link Expressway (EDL, that links the North-South Expressway with the city’s CIQ Complex). Thus, all vehicles at the CIQ pay a charge whether they actually use it or not. The latest is a RM25 5-year Malaysia VEP, that adds to last year’s new RM20 road charge, that took a round trip for a Singapore car going into Johor to about SGD19.

Johor State Assemblywoman Wong Shu Qi explains that this “toll hike competition” causes more Johor workers to use motorbikes. She points out that things are still to the relative benefit as  “Singapore cars pay RM56.80 per roundtrip whilst a Malaysian car pays RM 165.80.” Think also of the cost of having a family dinner in Johor versus Singapore.

Other Johor resident point to a well-off segment of Johoreans working in Singapore and driving Singapore registered vehicles as bearing the greater cost increase of about RM400 per month (RM20 road charge for 20 work days). Some can afford this, and others already defray costs by carpooling to their Singapore jobs. It seems there is limited sympathy in Johor for the extra charges as they appear to be largely borne by a relatively small segment of well-off Johor residents.

Indeed, there is even negative sentiment in Johor about Singapore registered cars. Assemblywoman Wong explains that: “Many locals reckon that Singapore vehicles that are driven rudely and recklessly in Johor are actually driven by Malaysians with Singapore PRs who are proud of owning a Singapore registered car.”

Perhaps the ones to sympathise with are the 100,000 motorcyclists on stressful daily commutes. While they do not face such rising charges, a Johor resident points out that fights are not uncommon. “Many have added spikes to their motorbikes. The police have gotten good at breaking up the fights, and they don’t arrest them.”

So, Singapore shoppers easily shrug off rising car charges but Johoreans face more motorbike angst and carpooling as the long term decline of the Ringgit against the Singapore dollar has driven even more to seek jobs in the island state. As for those selling property to make Johor a dormitory for Singapore, some developers currently see the tolls as a minor issue relative to the over-supply of condominiums and crime problems. Township developers are currently more worried about the too-low 70% financing offered to their buyers, but are long-term positive as their landed units are cheap for Singaporeans.

The future Rapid Transit System will no doubt be greatly welcomed by the current quarter million Johor commuters and keenly eyed by Singaporeans considering Johor for more than the weekend foot massage. For now, the feeling is that it was high time that Johor commuters with Singapore cars should pay more for their road usage; but they would no doubt wish that they get more than the allocated 20% of the RM20 road charge for Johor state coffers.

Khor Yu Leng is an independent political economist at Segi Enam Advisors Pte Ltd.

Note: One Singapore Dollar (SGD) equals 3.11 Malaysian Ringgit (RM). The Malaysian Ringgit now has 2/3 of the exchange rate value it had with the Singapore Dollar in 2002. The author lived for a period in Johor Bahru as a young child. She remembers crossing to Singapore every weekend for shopping, eating and visiting relatives. She also remembers that the Singapore Dollar exchange with the Malaysian Ringgit was one-for-one.


Author’s interviews with seven Johor observers, 14-25 October 2017

Nearly 300,000 walk between Johor and Singapore daily, 22 April 2016, AsiaOne, (accessed 25 Oct 2017).Motorcyclists grumble over congestion at Johor's new M-Bike lanes, 21 Feb 2017, New Straits Times, (accessed 25 Oct 2017).Busy U.S.-Mexico border crossing reopens ahead of schedule, 25 Sep 2017, LA Times, (accessed 25 Oct 2017).RTS to Shorten Travel Time Between JB and Singapore, 28 Sep 2017, Property Guru, (accessed 25 Oct 2017).Singapore says will hike Causeway toll rate if Malaysia does, 29 Jul 2014, Malay Mail, (accessed 25 Oct 2017).Singapore says will hike Causeway toll rate if Malaysia does, 29 Jul 2014, Straits Times,   (accessed 25 Oct 2017).

16 Oct 2017: Malaysia 5-year VEP (RFID tag) RM25 fee adds to RM20 Road Charge

Malaysia to implement Vehicle Entry Permit for all foreign-registered vehicles 9 Oct 2017 -- All foreign-registered vehicles entering Malaysia will soon require a Vehicle Entry Permit (VEP) that costs RM25 (S$8), said Malaysia’s transport minister Liow Tiong Lai on Saturday (Oct 7).

This is on top of the RM20 road charge currently imposed on vehicles entering Malaysia from Singapore. The VEP would be valid for five years, said Mr Liow, without giving a timeline for its implementation. Vehicle owners who paid for the VEP will be issued with a Radio Frequency Identification (RFID) tag to be placed on the windshields of their vehicles. “The VEP will help us to identify the number of foreign vehicles entering Malaysia and also to prevent car theft and car cloning syndicates,” Mr Liow was quoted as saying by The Star. He added that the road charge would also apply to the northern border with Thailand by the end of this year or early next year. “We will implement the VEP and the RC at border entries between Brunei and Kalimantan, Indonesia for cars coming into Sarawak from the two countries at a later stage,” he said. Read more at

Foreign vehicles entering Singapore to pay 'reciprocal road charge' of S$6.40 Singapore 16 Jan 2017 -- Starting Feb 15, all foreign-registered cars will have to pay a reciprocal road charge (RRC) of S$6.40 when they enter Singapore via the Tuas or Woodlands Checkpoints, the Land Transport Authority (LTA) announced on Monday (Jan 16). "The RRC mirrors Malaysia’s road charge of RM20 (S$6.40) per entry for non-Malaysia registered cars entering Johor, which was implemented on Nov 1, 2016," LTA said. The road charge will be collected together with the Vehicle Entry Permit (VEP), toll charges and fixed Electronic Road Pricing (ERP) fees upon departure at the Tuas or Woodlands Checkpoints. An average of 20,000 Singapore-registered vehicles enter Malaysia daily via the two land checkpoints. Read more at

RM20 road charge for foreign vehicles entering Johor from November, 28 Oct 2016 -- Foreign private-registered vehicles entering Malaysia via Johor will be subjected to an RM20 (S$6.60) charge from Nov 1, the Ministry of Transport (MOT) announced on Friday (Oct 28). The road charge (RC) will be collected each time motorists enter Malaysia via Touch n’ Go cards, according to the statement. The RC system has been activated at the two land entry points in Johor - the Causeway and the Second Link - and will be extended to the 10 other entrances into the country in stages.

"Initial collection exercise will only involve foreign private-registered vehicles excluding foreign registered motorcycles," MOT added.  The ministry said the RC is not to be confused with the Vehicle Entry Permit (VEP). It described the VEP, which requires foreign vehicles entering Malaysia to be registered via an online portal for an RFID tag costing RM10, as "part of ongoing efforts by the Government of Malaysia to improve border control and monitoring". Read more at

8 Feb 2017: Singapore reciprocal road charge on Malaysia vehicles starts on 15 Feb, no cross-border paid car pooling, Singapore-JB MRT link?

Editor's note: I was chatting with a Singapore-based economist this morning. On the 15th the higher fee cars for the Malaysia-Singapore crossing kicks in (triggered by Malaysia's special fee on Singapore cars – which is not replicated for its Thai and Indonesia borders). Families living-straddling border have to split (meet up weekends) or face an extra RM2000 per month commute cost. I also saw headline today’s news about tighter rules on renting out rooms in Singapore (but I haven’t read it yet). 

New entry charge for foreign cars from Feb 15, PUBLISHED JAN 17, 2017 -- Foreign cars entering Singapore will be levied a new entry charge from Feb 15, in line with earlier government pronouncements that the Republic will match similar fees implemented by Malaysia. In an announcement yesterday, the Land Transport Authority said a reciprocal road charge of $6.40 per entry will apply at both the Tuas and Woodlands checkpoints. It said the fee mirrors Malaysia's road charge of RM20 (S$6.40) for non-Malaysia registered cars entering Johor that was implemented on Nov 1 last year.... On Jan 9, Coordinating Minister for Infrastructure and Minister for Transport Khaw Boon Wan told Parliament that Singapore intends to match Malaysia's road charge.... He pointed out that Malaysia collected about RM13.93 million in road charges from Singapore vehicles in the seven weeks from Nov 1. Singapore's reciprocal charge will be collected with the vehicle entry permit (VEP) and toll charges for the two crossings, which can amount to as much as $41.50 for cars. During Electronic Road Pricing (ERP) hours, foreign cars without an in-vehicle unit are also levied a fixed ERP charge of $5 a day.

Paid cross-border carpooling services are against regulations: LTA By Linette Lim  Posted 20 Jun 2016 -- Responding to queries from Channel NewsAsia, an LTA spokesperson said: "Malaysian-registered cars are not allowed to provide hire-and-reward services in Singapore without a public service vehicle licence." Likewise, Malaysian regulations do not permit Singapore-registered cars to do the same in Malaysia without a public service vehicle licence.

Singapore-JB MRT to be linked by high bridge; deal by 2017 PUBLISHED DEC 14, 2016

Nearly 300,000 walk between Johor and Singapore daily Apr 22, 2016 -- ISKANDAR PUTERI - An average of 295,731 people use the two land crossings between Malaysia and Singapore daily. State Tourism, Trade and Consumerism Committee chairman Datuk Tee Siew Kiong said Immigration Department records showed that some 107.9 million people used the Johor Causeway and Second Link last year. "This did not include the ones travelling on motorcycles, cars, vans, lorries and buses. - See more at:

 19 October 2015: New Johor-Singapore vehicle permit system delayed again, Malaysia toll hikes, Immigration Dept can impose travel ban against those who shamed Malaysia

Immigration Dept can impose travel ban against those who shamed Malaysia Published: 18 October 2015 3:38 PM - See more at:

New Johor-Singapore vehicle permit system delayed again, exco says Updated: 5:10 PM, October 7, 2015 KUALA LUMPUR — The new Vehicle Entry Permit (VEP) system meant for both causeways linking Malaysia to Singapore has been delayed a second time despite an earlier announcement that the system would go live last Thursday (Oct 1). Johor Public Works, Rural and Regional Development committee chairman Hasni Mohammad said that the new start date for the system, which has already registered 20,000 Singaporean vehicles according to the Road Transport Department (RTD) website, will be determined during the mentris besar and chief ministers meeting. “We have to wait for the outcome of the meeting before making any comment or announcement,” he was quoted as saying by The Star Online. This is the system’s second delay, the first resulting from “technical difficulties”, which pushed back its August 1 launch. According to newswire Bernama, the VEP system will initially involve foreign-registered vehicles entering Malaysia through Johor but will eventually be applied to all 12 road entry points into the country. Roads from Thailand will be next to receive the VEP system, followed by Brunei and Indonesia. THE MALAY MAIL ONLINE

Toll hikes: Why is Barisan Nasional on a suicidal path? Sin Chew Daily Published Oct 16, 2015, 1:06 pm SGT; In its editorial on Oct 15, 2015, Sin Chew Daily questions the belief that Malaysian voters will forget the hikes when it is time to vote in two years' time. First of all, toll rates for 18 major highways in the country was increased with effect from Thursday (Oct 15). And before long, the frustrated public began to lash out mercilessly at the government for the sudden and drastic increase.... The BN government used to cap the toll hike by way of compensating the concessionaires or allowing them to extend their toll collection periods.  I believe they might have weighed the pros and cons that they have decided to leave the concessionaires alone this time. Apparently the government is placing its stake on some common human attributes: forgetfulness and adaptability.  The next general elections may be more than two years away, and the time is long enough to diffuse any negative impact that might come with the rising toll rates.....

Toll hikes better now than later, says report Published: 14 October 2015 9:06 AM

See more at:

All highways involved in toll hikes not ‘inter-urban’, says body Published: 17 October 2015 8:37 PM; All 18 highways which increased their toll rates since last Thursday are not categorised as inter-urban highways. The Malaysian Highway Authority in a statement today said inter-urban highways were highways linking one state capital to another state capital and forming a national highway network as they connected the rural areas to the towns. “Geometrically, inter urban highways have controlled access as commuters can only enter the highways via certain interchanges. googletag.cmd.push(function() {googletag.display('div-gpt-ad-1400601790726-3');}); “Highways categorised as an inter-urban highway are the North-South and East Coast Expressways,” the statement said. The highway authority also explained that the KL-Karak Highway (KLK)is not an inter-urban highway as the highway only connects Gombak and Bentong, Pahang. - See more at:

PLUS toll hike due next year By: LEONG HUNG YEE Saturday, 17 October 2015

Toll hikes coming to Penang as well   By Audrey Dermawan - 13 October 2015 @ 12:53 PM

‘Betrayal,’ PM says of toll hike proposal leak By Ida Lim Saturday June 13, 2015 - See more at:

5 August 2015: 

Malaysia's new VEP fee (RM20 per entry and RM10 for 5 year registration) discriminates against Singapore vehicles - Singapore may hike vehicle entry fee in tit-for-tat move

Malaysia's new VEP fee discriminates against Singapore vehicles: Transport Ministry "Such costs and inconveniences could discourage Singaporeans from going to Malaysia, in particular Johor, for leisure purposes such as shopping, entertainment, sight-seeing, holiday," the Transport Ministry says.

POSTED: 04 Aug 2015 20:47  UPDATED: 04 Aug 2015 22:43; SINGAPORE: Malaysia's upcoming RM20 (S$7.16) entry fee for foreign-registered vehicles travelling through Johor, "discriminates against Singapore vehicles", the Ministry of Transport (MOT) said on Tuesday (Aug 4). The fee kicks in on Oct 1 and the ministry said Singapore will consider matching the levy in some form after studying its implementation. MOT also said it is requesting more information from Malaysian authorities on their new requirement for Singapore vehicles to pre-register before entering Malaysia. Over the weekend, Malaysian Deputy Transport Minister Abdul Aziz Kaprawi was quoted by The Star as saying "from Sep 1, Singapore vehicles which are not registered with the Road Transport Department (JPJ) would be refused entry into Malaysia”.

Singapore may hike vehicle entry fee in tit-for-tat move Published: 4 August 2015 11:56 PM; Aziz also said that Malaysia is aiming to roll out a second phase of the Vehicle Entry Permit (VEP) system covering the Malaysia-Thailand border by the middle of next year. The mandatory registration applies to all private vehicles, public buses, taxis, goods vehicles as well as diplomatic cars. Vehicle owners are also required to pay RM10 for the road charge, which is valid for five years. Separately, from October 1, Singapore-registered private passenger vehicles will have to pay RM20 per entry for the VEP. The VEP for foreign vehicles was previously scheduled to begin on September 1, after it was postponed from August 1. Payment can be made only with Malaysia’s Touch ‘n Go card. In August last year, Singapore raised its entry permit charges – for the first time since 1994 – for foreign cars and goods vehicles. Singapore's Land Transport Authority had explained that the increase sought to “equalise the cost of owning and using a foreign-registered vehicle in Singapore with that for a Singapore-registered vehicle”. In response, Malaysia raised the tolls at the Causeway in the same month. Two months later, Singapore followed suit, as part of a long-standing policy that ensures a fair distribution of total revenues from the crossings. – TODAY Online, August 4, 2015.

21 July 2015:

Singapore-Johor Baru shuttle train - The Shuttle Tebrau and Johor-Singapore taxi services resume after licence extension

Thumbs up for Singapore-Johor Baru shuttle train - The Shuttle Tebrau, launched last Wednesday, offers seven trips a day in each direction. Checks by The Straits Times on Friday evening and yesterday morning found the carriages packed. The Shuttle Tebrau, launched last Wednesday, offers seven trips a day in each direction. Checks by The Straits Times on Friday evening and yesterday morning found the carriages packed.PHOTO: DIOS VINCOY JR FOR THE STRAITS TIMES; Published Jul 6, 2015, 5:50 am SGT; Journey lasts five minutes, the immigration queues are shorter and there is no traffic jam...Information technology consultant Ann Ang, 44, found it "so much easier" to get through Singapore and Malaysian immigration checks in one go now, rather than having to hop on and off a bus on each side. "I don't have to keep carrying bags up and down the bus."...Now, trains depart from Singapore at 6.30am, 8am, 9.30am, 5pm, 6.30pm, 8pm and 11pm. But some passengers said they would like to see more services, particularly in the afternoon....





Johor-Singapore taxi services resume after licence extension Updated: 8:52 AM, July 4, 2015 SINGAPORE — Taxi services between Johor and Singapore, which have been halted since midnight on Wednesday (July 1) because of lapsed permits for Malaysian cabbies to ply the cross-border routes, have resumed after the Land Transport Authority (LTA) extended their licenses until July 31. The disruption arose because the LTA’s Malaysian counterparts did not receive the licence renewal documents despite these being sent last Monday....




19 April 2015:

Plan to ban lorries on Causeway

Plan to ban lorries on Causeway, VEP will affect business: SMEs By Chloe Wang UPDATED: 07 Apr 2015 23:38

Singapore SMEs say plans to ban heavy vehicles from using the Causeway and the new foreign vehicle entry permit will hit businesses that rely on daily deliveries from Malaysia.

Johor wants to ban heavy vehicles from using the Causeway, says public works official Published on Apr 4, 2015 4:20 PM - See more at:

6 April 2015:

Malaysia expected to levy $7.40 Vehicle Entry Permit for foreign vehicles from Aug 1 - Straits Times

Malaysia expected to levy $7.40 Vehicle Entry Permit for foreign vehicles from Aug 1 Published on Apr 4, 2015 4:09 PM; JOHOR BARU - Malaysia has said that it would be expected to start levying a Vehicle Entry Permit (VEP) for foreign vehicles entering Malaysia from Singapore on Aug 1, Bernama has reported. "This is the first time Malaysia is implementing the charge and definitely it will take time in terms of procuring and installing the equipment," Bernama quoted Malaysian Deputy Transport Minister Abd Aziz Kaprawi as saying on Saturday. He added that the equipment, to be installed at both the Woodlands Causeway and Tuas Second Link, would facilitate the charging of the RM20 (S$7.40) VEP. Datuk Abd Aziz also said the VEP on foreign vehicles crossing the border to Malaysia via other checkpoints, such as those at the Thailand border, would be the same, reported Bernama. He added that his ministry would discuss fare increases for express buses with the Land Public Transport Commission, according to Bernama. Responding to the changes, a spokesman for Singapore's Transport Ministry said: ""We will study the Malaysian levy and consider matching in some form after the details are confirmed." ... ....

14 January 2015: Malaysian sting operations to collect unpaid fines from Singapore motorists

Johor Baru op nets $900k in unpaid fines from Singapore motorists By Danson Cheong And Lim Yi Han; Published on Jan 14, 2015 6:13 AM; The six-day operation from Dec 27 to Jan 1 was conducted near and at Johor Baru immigration checkpoints. -- PHOTO: BERITA HARIAN MALAYSIA

Malaysian traffic police, in a six-day operation, collected more than RM2.4 million (S$900,000) in outstanding traffic fines from Singapore motorists.... The operation, conducted from Dec 27 to Jan 1, caught 13,529 drivers with outstanding fines near and at Johor Baru immigration checkpoints.

Johor Traffic Police Chief Baharudin Mat Taib told The Straits Times that more than 15,470 fines were paid during this period, with almost $500,000 paid in cash.... The rest of the fines were settled by credit card.... He added that Malaysian officers will continue to conduct such sting operations regularly......

23 December 2014:

More tit-for-tat fee hikes on Malaysia VEP by mid 2015?

‘Resolve VEP fee issue amicably’   23 December 2014 @ 8:13 AM; JOHOR BARU: Malaysia and Singapore have been urged to discuss issues related to toll fees and the imposition of the Vehicle Entry Permit (VEP) fee for the good of Johor’s Iskandar Malaysia region.... Pulai member of parliament Datuk Nur Jazlan Mohamed said it was important for both sides to look at the bigger picture and take into consideration the total impact that any increase by Singapore would have on Iskandar Malaysia.... “It is time for both governments to resolve this issue and work together for the long-term benefits,” he told the New Straits Times yesterday.... Nur Jazlan, who is also Public Accounts Committee (PAC) chairman, was responding to yesterday’s Singapore media report, which said its Ministry of Transport would be studying Malaysia’s move to impose a VEP fee of RM20 (S$7.55) for foreign vehicles from Singapore starting middle of next year.

3 August 2014: Singapore-Malaysia border crossing fees face tit-for-tat hikes

The Singapore-Johor crossings are heavily trafficked and its two road links are key to the supply-chain of the low-key traffic of essential goods and labour from lower cost Malaysia to the booming Island state. On traffic numbers, Malaysia sources estimate 300,000 vehicles (including 3,000 to 4,000 trucks and lorries) cross Johor-Singapore daily (presumably this is for both crossings?) while Singapore reported over 130,000 vehicle across the JB-Singapore Causeway and capacity of 200,000 vehicles for the Second Link. At the same time, the leaders and sovereign wealth funds of the two nations have come together in recent years to promote Johor as a hinterland and dormitory town for the higher cost Singapore core economy.

I have written about this topic several times since I first prepared a review of Iskandar Malaysia for the Rajaratnam School for International Studies (RSIS) in 2011. More recent postings on Singapore-Johor Iskandar topics in this blog include: a)


 (refer to 18 June 2014 update: China developers have significant investments in Malaysia, particularly in the Johor-Iskandar Malaysia zone which is developing as a northern adjunct to Singapore..."), b)


 on Johor-Iskandar & Malaysia power shifts, and c)


on Petronas' RAPID project in Johor. ISEAS is currently reviewing the final draft of my paper on "Political Contestation in Iskandar Malaysia: Views on economic integration during Malaysian GE-13" on research done end-2013, to be published as chapter in a book by ISEAS in 2014/2015 (highlights of Johor voting outcomes noted here -



On the cost of driving a Johor car to work in Singapore. A KL friend whose nephew lives Johor and works in Singapore mentioned that the monthly cost of running a Malaysia registered car in Singapore had gone up terribly, due to the increased Singapore VEP fee. The estimate was some SGD1,500 per month (petrol, unrevised border toll charges, new Singapore VEP and parking). If the 30-year old Mr Chin cited in the Bloomberg article below did the same, it would seem a significant chunk of his monthly salary could go to these costs. This would seem problematic, in addition to his long commute cum work hours. Another cross border commuter, Mr Chan working in Singapore says he leaves home 6.45am to sometimes after 11pm; causing apparent nascent marital problems. Thus, in the pursuit of the Singapore dream of a cheaper landed property, the "Mr Chins" would presumably have to find a cheaper form of transport than a Johor private car or else be priced out of this lifestyle. You would need to have a high enough income. A Singapore private car would avoid the new daily SGD 35 Singapore VEP fee of SGD700 per month assuming 20 working days. But it is more costly to purchase and may apparently face a tit-for-tat fee set by the Malaysian authorities anyway on foreign vehicles in its territory (see Malay Mail quote below).

Since the calculus above, Malaysia and Singapore have decided on hikes on crossing toll fees too (on top of the daily "usage fee"). At the JB-Singapore Causeway, before 1 August 2014 was SGD2.30 for a round trip, but will rise to SGD12.80 soon. Thus, a 20-day per month commute would cost SGD256 in such fees, compared to  SGD46 before. This could make the monthly Johor car transport fee amount to over SGD1,700 per month? Note that crossing fees for the Tuas Second Link are different.

Singapore argues that "Based on 2013 data, the VEP fee increase will only affect about one in ten foreign-registered cars. Other foreign-registered cars will not be affected as they enter and stay in Singapore on VEP-free days or during VEP-free hours," but this may nevertheless crimp the hopes of the lifestyle property seeking "Mr Chins" of Singapore.

A Malaysia newspaper article says that "Ties between the two countries over commuters plying the link are already strained following Singapore’s move to raise vehicle entry fees, which prompted Putrajaya to introduce a similar tax for foreign vehicles entering via the country’s southern border.... And following the report that Malaysia may increase toll charges for the Causeway by as much as threefold for inbound vehicles, Singapore’s Land Transport Authority (LTA) said it will follow suit with an equivalent amount if the rumours prove true, according to The Straits Times today.... Once-testy relations between the two Southeast Asian neighbours have grown balmy in recent years, culminating in infrastructure joint ventures in both countries such as the Kuala Lumpur-Singapore high-speed rail link.... But the recent controversy over Singapore’s VEP increase and Malaysia’s apparent retaliation is again leading to strains in ties linking the countries that were part of the same nation from 1963 to 1965."

Thus, it would seem that the further development of Johor as a northern adjunct to Singapore is quite crying out for a direct cost-effective mass transport linkage to ease the problems of travel time and cost. It is a bit surprising that the Malaysia and Singapore authorities and their sovereign wealth funds (SWFs) so invested in promoting Singapore-Johor transboundary living (and selling high-end properties in Iskandar Malaysia) have chosen to jam up some of the key household financial economics of such a lifestyle before mass transport has been put in place.

New links:

Singapore to match Johor's new Causeway tolls 'in next few weeks': LTA Published on Aug 1, 2014 8:14 PM By Hoe Pei Shan; "SINGAPORE - Singapore will match Johor's new higher Causeway tolls "in the next few weeks", said the Land Transport Authority (LTA) on Friday night. "As details of Malaysia's toll revisions were not made known to Singapore earlier, LTA would need some time to operationalise the changes," said a spokesman. Should Malaysia reduce or do away with the toll charges, Singapore will follow suit, he added.... As of midnight Friday, cars entering Johor from Singapore through the Johor Baru Customs, Immigration and Quarantine (CIQ) Complex have to pay a toll of RM9.70 ($3.78), up from the previous RM2.90. Cars travelling from Johor to Singapore previously paid no tolls, but are now subjected to a new toll of RM6.80 ($2.70). While motorcycles continue to be exempted from the tolls, drivers of bus, goods vehicles and taxis now also have to pay more at the Malaysia checkpoint.... LTA currently imposes separate lower tolls for vehicles going from Singapore to Johor, but none for when they return.

When Singapore matches Malaysia's rates, cars making a round-trip can expect to pay a total of about $12.90 in tolls, up from the current $7.60, and more than five times the $2.30 before August 1

.... Meanwile, the Singapore Chinese Chamber of Commerce and Industry (SCCCI) has expressed its concerns over the toll increases. In a statement to the media, the president of the SCCI, Mr Thomas Chua said the higher charges will increase transportation costs for businesses and affect the ease of commuting...."

source: Straits Times, 1 Aug 2014 article cited above

Thousands of motorists entering Singapore to suffer, say Johor MPs By Vanessa Ee-Lyn Gomes

Wednesday, July 02, 2014 - 14:48; "THOUSANDS of Malaysian motorists, who enter Singapore through the Causeway daily, would need to fork out more money following a revision in the Vehicle Entry Permit (VEP) and Goods Vehicle Permit (GVP) fees effective August 1..... Malaysian cars entering Singapore will be charged a VEP fee of RM90.05 per day, a RM38 increase from the current fee of RM51.46. The GVP for foreign-registered goods vehicles will be raised to RM102.91 per month compared to the current RM25.73 fee.... Kluang MP Liew Chin Tong admitted the new fees would greatly impact Malaysians who travel to and work in the republic. He added

an estimated 300,000 vehicles crossed the Johor-Singapore Causeway daily, most of which were Malaysian-owned....

The Pan-Malaysia Lorry Owners’ Association pointed out lorry operators would suffer the most because they would have to bear the cost of the fee increase directly as

some 3,000 to 4,000 trucks and lorries enter Singapore daily



a traffic jam leading to the Tuas Second Link crossing to Johor.

JB-Singapore Causeway, source: AFP picture on this webpage

Cut-Price Luxury Homes Fuel Singapore Tri-Nation Sprawl   By Sharon Chen  Jun 9, 2014 9:20 AM GMT+0800; "Darren Chin gave up a 15-minute train journey to his office in Singapore for a two-hour drive with a stop at passport control. The reason: By commuting from Malaysia, he can afford his own two-story home and car. “It’s worth it,” said the Malaysian financial adviser, who leaves his house before 6:45 a.m. to get to his job at Oversea-Chinese Banking Corp. (OCBC) on time. “I’m saving on rent and I’m paying for my own house.”... Chin is part of the expansion of Southeast Asia’s richest city across its borders as residents and companies seek property, labor and amenities, often at half the cost or less. The result is a three-nation urban complex with a population bigger than London and an economy that would rank as one of the fastest-growing in the region....

A five-bedroom, two-story home with private pool in Iskandar was advertised last month for 3.9 million ringgit. A similar-sized home on Singapore’s prime Sentosa district with a waterfront view was on sale for about 15 times as much.... The tri-nation super-city does have some unique problems. With only two road links to Malaysia, rush-hour traffic can cause delays of 90 minutes or more at immigration. More than 130,000 vehicles a day cross the kilometer-long Causeway, built in 1923

, Singapore’s Deputy Prime Minister Teo Chee Hean told parliament in February.

The second route, a bridge opened in 1998, has the capacity to take another 200,000

...... “I try to leave Singapore as late as possible, or the traffic is very bad,” said Chan Ong Yong, a Malaysian truck driver who lives in Johor and works in Singapore delivering and installing sheet glass. “If I lived in Singapore, the rent would be too high and school would be too expensive.”..... Chan, a 30-year-old father of three, earns about S$3,000 ($2,393) a month, twice what he would get in Malaysia. The cost: Some nights, he doesn’t get home until after 11 p.m. “Sometimes I fight with my wife because I spend so little time at home,” Chan said..... Commuters like Chan face two stops for passport control and customs each way, with vehicles frequently searched for contraband goods that are cheaper in Malaysia. Singapore-registered cars entering Malaysia are required to have fuel tanks at least three-quarters full, as gasoline is less than half the price across the Causeway....."

Penang news (update 7): Changing property market of Penang ; Penang investments and budget surplus shows improved performance post 2008 under DAP administration; for 2014 Johor, Sarawak and Penang the top three states for investment. BPO projects in Batu Kawan and Bayan Baru respectively, would be jointly developed with Temasek Holdings and Economic Development Innovations Singapore

15 March 2015: Changing property market of Penang

Changing property market of Penang By: DAVID TAN Saturday, 14 March 2015 - Legislation, bridge and location are some factors affecting prices; UNTIL about a year ago, Penang’s south-west district was known as the locality for affordably-priced properties.Since 2008, Ideal Property Group has developed over 4,000 units with a RM3bil gross development value (GDV) there. These include One World, One Residence and Fiera Vista in Bayan Lepas, priced between RM300,000 and RM800,000. These have become landmark projects. In the sub-sale market, prices have since increased from RM380 to RM500 per sq ft (psf) for high rise condominium, and more than 50% for landed units.... With the Penang second bridge project completed last year, new launches of high-rise properties hit about RM550 psf last year.The very expensive ones are located in prime locations such as Tanjung Tokong, Tanjung Bungah, and Pulau Tikus neighbourhoods in the north-east district.
For example, when the Marinox Sky Villas, a leasehold condominium in Tanjung Tokong was launched in 2012, it was sold at around RM650 psf. This has increased to over RM600 psf last year.
Similarly, condominiums in City Residence at Tanjung Tokong by Ivory Properties priced at RM750 psf in late 2013 have increased to over RM1,000 psf today....

27 February 2015: Penang investments and budget surplus shows improved performance post 2008 under DAP administration; for 2014 Johor, Sarawak and Penang the top three states for investment

Penang records 109% increase in investments By LOOI SUE-CHERN Published: 27 February 2015 2:08 PM Penang recorded a 109% increase in investments last year over 2013’s volume of RM3.91 billion. Out of the RM8.16 billion in domestic and foreign investments in 2014, RM5.1 billion came from foreign investment. Chief Minister Lim Guan Eng said this put Penang in the top three for states with the highest investments in the country last year, after Johor and Sarawak.... He said the domestic and foreign investments came mostly from the electrical and electronics (E&E) sector, while some also came from the biomedical sector. "This shows we are still strong in the E&E sector as a main player in the supply chain. It is a sign of sustainable progress. "We thank everyone in the industry as well as government agencies like the Malaysian Investment Development Authority (Mida) for all their efforts in drawing investments to Penang," he today. On the increase in investments, Lim said it was also important to look at the bigger picture. "From 2008 to 2013, we got RM40 billion compared with RM21 billion from 2002 to 2007..

Penang made more in 6 years than BN did in 50 By Susan Loone 3:49PM Feb 26, 2015 - A clean administration has enabled the Penang government to accumulate budget surpluses for six consecutive years since 2008, Chief Minister Lim Guan Eng said today. This is through its practise of competency, accountability and transparency or CAT, a policy touted by the Pakatan Rakyat-led administration when it seized Penang from BN in the March 8, 2008 general election....

4 February 2015: Is there some concern at MIDA about the proposed China electronic sector investments in Penang - cautious of photovoltaic investments using Malaysia's GSP and COO as a transshipment point to beat anti-dumping problems?

Mida keeps close tabs on China, Taiwan PV makers By: DAVID TAN Wednesday, 4 February 2015
GEORGE TOWN: The Malaysian Investment Development Authority (Mida) is adopting a cautious stand on investments by photovoltaic (PV) solar manufacturers from China and Taiwan.
Mida deputy chief executive officer Datuk Phang Ah Tong told StarBiz that this was because Mida did not want Malaysia to be used as a transhipment point for China and Taiwan-made PV cells and panels to enter the United States, as the latter had imposed anti-dumping duties on PV products originating from China and Taiwan.... The US International Trade Commission had recently imposed a minimum 70% tariff rate on China PV modules, and an 11.45% to 27.55% rate for Taiwan PV manufacturers.... Phang said that so far there were no significant PV investments from China and Taiwan in Malaysia... “However, we are still pursuing investments in alternative renewable energy such as bio-mass, bio-gas and small hydro plant a result of the foreign investments, Malaysia was the third largest solar module producer in the world after China and Japan, and the fourth largest producer of solar cells in 2013... The major corporations in Malaysia involved in PV manufacturing are First Solar and Panasonic Corp in Kulim Hi-Tech Park, Hanwa Q Cells in Cyberjaya, AUO Sunpower in Malacca and IRM Group Bhd in Ipoh.... Malaysia has been known as a transhipment point for China-made products using the GSP and COO documents issued for companies in Malaysia to enter Europe.....

30 January 2015: BPO projects in Batu Kawan and Bayan Baru respectively, would be jointly developed with Temasek Holdings and Economic Development Innovations Singapore , Penang housing affordability worsens, second worst after Sabah says Rahim & Co.

Penang sees RM5bil investments from 4 China MNCs listed in US By: DAVID TAN
Thursday, 29 January 2015; GEORGE TOWN: Penang will see some RM5bil worth of investments coming into the state in 2015 from four multinational corporations (MNCs) involved in electronic-based manufacturing activities.... investPenang director Datuk Lee Kah Choon said these were only initial investments that would materialise over the next 12 months.... Declining to name the companies, Lee said these could be China companies but public-listed in the United States..... Lee said the Penang International Technology Park and Business Process Outsourcing (BPO) projects in Batu Kawan and Bayan Baru respectively, would be jointly developed with Temasek Holdings and Economic Development Innovations Singapore and due for completion in five to 10 years...... “The projects has a gross development value of RM11.3bil and will generate 25,000 to 30,000 jobs in the future,” Lee said.....

Housing affordability worsens with Sabah top of list, Penang, KL Thursday, 29 January 2015
KUALA LUMPUR: Housing affordability, which is based on the ratio of average terraced house price to average household income, has worsened over the past five years, according to Rahim & Co, Chartered Surveyors Sdn Bhd.... In its survey of the Malaysian property market 2014/2015, the ratio increased from 3.4 in 2009 to 3.6 in 2012 and 2014.... “This essentially means that an average terraced house would cost an average household or family in Malaysia, 3.6 times its annual gross income.... “The least affordable terraced house in Malaysia in 2014 was recorded for Sabah (6.2 times), Penang state (5.9 times) and Kuala Lumpur (5.6 times). Sarawak was fourth with a ratio of 4.4 times,” the survey showed.... Rahim & Co, which is one of the largest real estate consultancy companies in Malaysia, also said in its outlook that transaction activities in the residential sector after expected to soften with the implementation of the Goods and Services Tax (GST) in April 2015.
To recap, Rahim & Co said that over the past four year, property prices were fuelled by the nation’s development plans, investment concentration and also the rapid growth in Iskandar Malaysia.
“The cautious market sentiment echoes the state of property market in reaching its plateau and reconciliation period is expected in the near future,” it said......

28 January 2015:  RM 5 billion electronic sector investments expected

Penang eyes over RM5bil in investments Wednesday, 28 January 2015; GEORGE TOWN: Penang aims to secure more than RM5bil in foreign direct investments from four major electronics companies planning to set up their plants here... Director of InvestPenang, a Penang government investment arm, Datuk Lee Kah Choon, said the four multinational companies (MNCs) were awaiting the approval from Malaysian Industrial Development Authority (MIDA). Lee, who is also the special adviser to the Penang Chief Minister, said the MNCs would help spur the state's economy and create as many as 2,000 jobs. "The majority of the jobs available will be for engineers, while the remaining are the supportive roles that include administration and marketing," he told reporters after the briefing on Penangs Economic Outlook 2015 on Wednesday today. He said two of the companies had started recruitment drives here and they would start operations after they received the green light from MIDA....

14 January 2015: Penang construction-related controversies, worries about deterioration of livability, overdevelopment concern starts to scare some expatriate property investors? 

Just how much more development can Penang take, concerned observers ask BY HIMANSHU BHATT AND LOOI SUE CHERN Published: 14 January 2015; (Dennis and his wife) invested in a house in the idyllic Batu Ferringhi tourism belt and for the past five years, as expatriates, have attested to Penang's reputation as one of the most attractive and livable islands in Asia. That was until recently, when they learned of a multi-storey high-density mixed development project which will be built just yards behind their home – despite the Batu Ferringhi area being designated for low-density projects under the Penang Island Structure Plan. A recent string of construction-related controversies that include ugly hill cuttings, urban flash floods and traffic congestion is changing perceptions about Penang's liveability and raising questions as to how much more development the island can take before its environment starts to degrade and the quality of life for residents suffer. Such limits, or carrying capacity, however, have never been confirmed by the state..... But Chow, who is in charge of local government, traffic management and flood mitigation, admitted that the state wanted to maximize land use – which meant allowing hillslope and high-density developments. This is in view of expected demand for new property as the island's population increases. As it is, there were a total of 2,595 planning approvals issued, of which 552 projects took place from 2000 to October this year, according to the Penang Island Municipal Council (MPPP)...... This situation begs the question of what the authorities use as yardsticks to determine if new development will overtax the island's resources. In the absence of such information, Lim suggested that road congestion could be used as a good reference point...... A study for the master plan has found that there are a quarter of a million vehicular trips being made during peak morning hours every working day in the state. Of these, 42.5% are within the island, underscoring the strain faced by the limited road system..... To date, the delay in gazetting development blueprints for Penang island has taken on a political dimension, with the state Barisan Nasional (BN) opposition criticising the long wait for the Local Plan to take effect.... In the meantime, Dennis, the retired engineer from Europe, and his wife, are now looking at moving away, possibly to Bali. "We were happy here. That's why we invested our money and bought a house," the elderly man said. "But this kind of development scares us as foreigners. I feel very unsafe and insecure......

22 November 2014 - E&E human rights allegations, construction and property, social assistance maxed out says Guan Eng

Rebut human rights abuse allegations, urges Penang by Imran Hilmy; Last updated on 20 November 2014 - 04:27pm; GEORGE TOWN: Penang has urged the federal authorities to rebut allegations that human rights abuses were taking place in the electric and electronic (E&E) sector in Malaysia. Chief Minister Lim Guan Eng said both the International Trade and Industry Ministry (MITI) and Human Resources Ministry (HRM) should take steps to ensure the country was not sanctioned due to negative perception.... He added any unfavorable impression should be countered before action was taken which could affect the economy, noting Penang had a huge E&E sector. He expressed confidence the claims of human rights violations were not true and urged for quick end to the matter.
"We hope steps are taken to ensure the economy is not affected," he said in a press conference today.
Bayan Baru MP Sim Tze Tzin had on Monday claimed the US Labour Department will put Malaysia on the "International Ranking on Forced Labour" watch list next month.... The move comes after global NGO Verite in a report titled "Forced Labour in the Production of Electronic Goods in Malaysia", highlighted several issues by some 500 male and female workers which included deceptive recruitment, poor living conditions and passport retention....

Penang gives out jobs worth RM6bil By: DAVID TAN; Tuesday, 18 November 2014; GEORGE TOWN: The value of jobs given out this year to the construction and renovation industry in Penang is expected to be around RM6bil, compared with RM9.25bil a year ago.... Penang Master Builders and Building Material Dealers Association president Datuk Lim Kai Seng told StarBiz that the number of jobs to be given out this year in Penang was around 400, compared with 539 in 2013.
“The reason for the slowdown is because many of the important construction jobs from the Government had already been given out in 2013.... “Last year saw a record 539 jobs worth RM9.25bil being given out,” Lim said. For the first nine months of 2014, some 308 jobs valued at RM3.3bil were given out, compared with 289 worth RM5.3bil in the corresponding period of 2013, according to the latest Construction Industry Development Board report. Of the 308 jobs, some 45 were from the government sector, while the balance 263 were from the private sector.... It was reported in March that Kuala Lumpur and Penang-based developers would develop RM4.56bil worth of residential and commercial projects in Penang this year amid the challenging environment for the property sector.... Developers set to launch new projects include IJM Land Bhd (gross development value, or GDV, of RM538.5mil), Mah Sing Group Bhd (RM280mil), DNP Land Sdn Bhd (RM800mil), Wing Tai Malaysia Bhd subsidiary Ideal United Bintang (RM935mil), Tambun Indah Land Bhd (RM616mil), Sunway Bhd (RM290mil), SP Setia Bhd (RM300mil) and Eastern & Oriental Bhd (RM800mil)....

Penang can’t afford to spend more to help Penangites: Guan Eng; 15 November 2014 @ 10:14 AM;
GEORGE TOWN: The Penang government cannot “cough up” more to help the people in the state, including for transportation and healthcare because it cannot afford it, said Chief Minister Lim Guan Eng.... Lim (DAP-Air Putih) told the State Assembly that this was due to the fact that the state government had already extended “gold” assistance focusing on certain target groups... Among them are for warga emas (senior citizens), anak emas (special needs children), pelajar emas (outstanding students), schools, students of religious schools, the state’s Equitable Economic Agenda, net aid for fishermen, taxi drivers and trishaw riders.... “All these have totalled RM287,138,545.51 since 2008, and for 2015, RM116.94 million has been set aside for this purpose. “If there is added expenditure (for aiding people), the state government will not only experience a budget deficit but also might go bankrupt,” he said when winding up debate on the state’s Supply Bill 2015 yesterday....

9 July 2014 - Penang mega transport plan

Hot in recent Malaysia investor news is Penang's new integrated transportation plan. It will apparently be funded in large part by a land swap/ reclamation deal i.e. property development on reclaimed land. I happened to meet the Penang Chief Minister at the airport last week and ventured to say hello. He asked if I was from Penang and encouraged me to move and buy property in Penang - there's apparently upside to home prices there!

Starting to talk to international public policy specialists on this.

Q: Is DAP in Penang taking the Singapore PAP route of making property development a large component of its economy? Is this perhaps the only way they can get things done given federal-state financing situation in Malaysia?

A1. Interesting, but would have to be done carefully—Federal-State coordination still needed-otherwise political risk high. Singapore does not need to worry about that.
Broker research news on Penang's mega transport project:
Malaysia Construction (Hoy Kit Mak) - Penang integrated transportation plan positive for the sector - ALERT
"We remain positive on the Malaysian Construction sector, a beneficiary of the upcoming M$160B railway-related infrastructure spending. Latest newsflow on Penang’s plan for a M$27B integrated transportation plan (M$5B initial) is positive for contractors with deep pockets and large-scale project management expertise. A request for the proposal will be called next month, and key contenders include Gamuda, IJM, Scomi and WCT. We think IJM/Gamuda has an advantage, with a bias toward Gamuda, our top sector pick and one of our top country picks."
Malaysia Construction - Mega-projects: Let’s be realistic by  Tushar Mohata; Alpa Aggarwal, Nomura 08 Jul 2014: "News report suggesting Gamuda favourite for Penang transport project manager role§ Over the weekend, an article in The Star (Gamuda leads pack for multi-billion ringgit Penang transport job, 5 July 2014) suggested that Gamuda (GAM MK, Buy) is a frontrunner for the Project Delivery Partner (PDP) role for the Penang island integrated transportation plan, with the project worth as much as MYR 27bn (recall that the PDP fee for MRT Line 1 was 6% of the total project value). § The market has taken this news positively, with Gamuda’s stock price up 2.5% on Monday.Mega-project awards to be slow; advise investors to be conservative§ We caution investors on having high expectations from Malaysian mega-projects (such as the Penang transport plan) in the near to medium-term. The government has multiple mega-projects on its radar as part of its Economic Transformation Plan goals, and construction works for some of these projects may involve a huge capital outlays. § Indeed, as we have seen in the past, various projects keep surfacing in media reports / budget announcements, only to be put on the backburner again (see Fig 2, a case in point being the MYR 8bn Gemas – JB Southern Double Tracking project, which has been discussed for several years now but is nowhere close to being awarded, in our view).Stick to high likelihood project winners – e.g., MRT Line 2, WCE§ Keeping the fiscal constraints in mind, as well as pending negotiations with the population over land acquisition and alignment issues, the government might spread out the award of these projects over multiple years. § The government is also likely to prioritize projects that have more immediate multiplier effects, and as a result, some of these discussed projects might not see the light of day anytime soon (see Fig 2).§ It is very difficult to say whether the Penang transport project will take off in the coming months, or to speculate on possible winners, in our view. Moreover, the winner of the Penang transport jobs will be compensated through a land swap / reclamation deal, which would take years to monetize through property development activities on the reclaimed land.§ As a result, we advise investors to selectively stick with contractors whose projects are already partially off the ground / awarded. We like Gamuda (GAM MK, Buy), as we are confident of the company’s prospects on MRT Line 2 Underground and PDP works and not for the Penang projects. We also like IJM (IJM MK, Buy) because of its more certain near-term earnings from the recently awarded West Coast Expressway (WCE) contract.§ Additionally, with 30-50% of their earnings being driven by property, these companies also benefit from a less volatile, higher-margin earnings stream."


Brazil's Vale in Malaysia (update 1b): Distribution in 10 days and 35% reduction in carbon emissions per tonne of ore

This is interesting. Vale spends US$1.4 billion in Lumut to build its new Asia port terminal at Teluk Rubiah, Perak in the Straights of Malacca. Valemax 400,000 tonne vessels are just huge! We had neighbours who are engineers from Brazil to help implement this project. Progesys notes that "the stockyard is designed to be able to handle 30m tons of iron ore annually and can be expanded to take a maximum capacity of 60m tons per annum."

Is this akin to what's happening in palm oil merchandising? The likes of Wilmar and Musim Mas have taken strategies to have terminals / bulking / capacity / logistics in key end use regions such as Africa (Wilmar noted to have bought / built / booked up capacities to better serve Africa buyers) and Europe (Musim's biodiesel acquisitions). From key industry sources, it is notable to hear Malaysia earlier had an allocated budget to help build up joint terminal / bulking facilities in strategic locations, but this never got off the ground on apparent commercial disinterest or dissension. Malaysia palm oil is facing stiff competition from Indonesia palm oil. On the latter's upstream expansion, it is inevitable that it gains market share.

16 November 2014: Vale 10 days distribution with major GHG savings, Vale surprise loss, LMT's exclusivity concession compromised

New Strategically Located Deep Water Bulk Ore Handling Terminal and Distribution Hub Opens -
Thirty Million Tonnes per Year Capacity Available for Iron Shipments; 12 November 2014;  "The new facility is a point where the ore can be stored and blended. Located in the Straits of Malacca, distribution of the ore will take a mere ten days, as opposed to the 45 day trip from Brazil allowing a much reduced delivery time for the iron ore to Vale’s clients in Asia and Southeast Asia. Murilo Ferreira, Vale's Chief Executive Officer, said: "Teluk Rubiah is a cornerstone of Vale's business strategy of investing in solutions which aim to enhance the company's capability to supply iron ore more efficiently to the Asian markets. The distribution centre brings our mines closer to our customers in Asia." .. With Teluk Rubiah, Vale will have the opportunity to blend ores with different grades from its production systems, which were always sold on the market separately, each one with different specific features, providing greater flexibility for supplying iron ore. Furthermore, the distribution centre, combined with a fleet of very large ore carriers, represents a more sustainable solution, contributing to a reduction in greenhouse gas emissions for iron ore delivered in Asia. Teluk Rubiah is capable of receiving the somewhat conceitedly named Valemax vessels, which allow for a 35% reduction in carbon emissions per tonne of ore transported. From there, the iron ore is transported in Capesize vessels to its port destinations...."

Vale Posts Surprise Loss as Currency Compounds Iron Rout  By Juan Pablo Spinetto   October 30, 2014; "Vale SA (VALE5), the world’s largest iron-ore producer, posted a surprise loss after a weaker Brazilian real boosted dollar-denominated debt and falling commodities prices pushed down sales to the lowest since 2010. Vale swung to a net loss of $1.44 billion, or 28 cents a share, in the third quarter from a profit of $3.5 billion, or 68 cents a share, a year earlier, it said today in a statement. The average of nine analyst estimates compiled by Bloomberg was for profit of 32 cents a share, excluding some items. Shares fell the most in Brazil’s benchmark index today... Iron-ore prices have fallen by more than half since a 2011 peak as Vale, Rio Tinto Group and BHP Billiton Ltd., the three largest producers of the steelmaking raw material, boost supply to gain customers. Results were impacted by $2.68 billion in foreign exchange and monetary losses on debt and derivatives...."

RAM Ratings reaffirms Lumut Maritime Terminal’s notes Thursday, 13 November 2014
KUALA LUMPUR: RAM Rating Services Bhd has reaffirmed the A1/Stable rating of Lumut Maritime Terminal Sdn Bhd’s (LMT) RM60mil Bai’ Bithaman Ajil Islamic debt securities (2004/2017) (BaIDS). It said on Thursday the rating remains anchored by the continued steady cashflow from LMT’s operations and maintenance agreement with Lekir Bulk Terminal Sdn Bhd (LBT), which at present caters to the coal-unloading requirements of TNB Janamanjung Sdn Bhd.
“The company’s rating is moderated by the dependence of its small port operations primarily on hinterland cargo, keeping a lid on growth potential.  “Meanwhile, revenues from the sale of land in the Lumut Port Industrial Park – which LMT has developed – are expected to taper, given limited land left to be sold, which will somewhat reduce its income diversity,” said the ratings agency. Perak Corporation Bhd, which is listed on the Main Board of Bursa Malaysia, holds a 50% stake plus one share in LMT.... LMT has a 20-year concession agreement (CA) with the Perak Government where it has exclusive port operations within a 30-km radius. However, the agreement ends in July 2015. “It remains to be seen whether the CA will be extended beyond next year, and we note that LMT’s exclusivity had been compromised in 2011 following the State Government’s approval of the establishment of a private jetty in Teluk Rubiah by Vale International SA,” it added.

10 November 2014
Brazilian giant seeks to erode its geographic disadvantage in supplying Australian customers as falling iron ore prices hurt producers' margins; UPDATED : Saturday, 08 November, 2014, 5:43am by Bloomberg in Singapore and Rio de Janeiro; "Vale inaugurated a US$1.4 billion port terminal in Malaysia as the world's biggest iron ore producer seeks to cut costs of shipping to Asia from Brazil with prices at five-year lows.... The facility on the Malacca Strait to stock and blend supplies would help Rio de Janeiro-based Vale compete against BHP Billiton and Rio Tinto Group in Australia, said Paul Gait, an analyst at Sanford C Bernstein.... Up to last month, eight Valemax vessels - the biggest ore carriers that can haul as much as 400,000 tonnes - had already called at the Teluk Rubiah site to discharge cargoes, with five smaller Capesizes loaded, Vale said.... "Vale is significantly farther away from the main centres of demand than its Australia competitors," Gait said. "What Vale can do is to lower the apparent cost of logistics, shrink the world, if you will, and make distance not matter so much."... Iron ore tumbled 44 per cent this year as increased supplies from Vale, BHP and Rio created a glut, prompting producers to squeeze costs to preserve margins...."

source: Teluk Rubiah: Vale of Tears for the “Malaysia Project” By Mariam Mokhtar
March 1, 2012;