Kedah's Gold Coast: Sanusi' Mission (Malaysian Industry, May 1997)

Dear Readers,

Assalaamu'alaikum Warahmatullaahi Wabarakaatuh

This article, which appeared in Malaysian Industry's edition for May, 1997, is reproduced as an attempt at 'TRANSFORMATION' which remains a dream unfulfilled.

Fahmi M. Nasir
Researcher at Toeti Juairiah Library

KEDAH ON THE FAST TRACK

By JOSEPH CHIN

The RM30 billion coastal reclamation project will create many economic spin-offs while preserving the state coastline. An airport, deep-sea port, hi-tech zone and tourism facilities will be built on the nine to 14 islands.

“The reclaimed land should be a place which you don’t believe is Kedah. When you go there, it must be somewhere in paradise. Industry-wise, tourism-wise”. An apt description by Kedah Menteri Besar Datuk Seri Sanusi Junid about the proposed massive coastal reclamation project which has generated tremendous interest among investors, industrialists and Kedahans alike.

Sanusi – the Menteri Besar – is a man in a hurry. He wants to change Kedah from economically backward state and bring it on par with other States such as Penang and Selangor. Says an official about Sanusi: “He wants to bring all Kedahans who are working in other states back to Kedah. He wants them to be proud to work for Kedah. That is why he wants to create economic opportunities.”

Working at feverish pace, Sanusi has mooted several development programmes to launch the rice-bowl state into a hi-tech entity with boundless economic opportunities since he was appointed Menteri Besar on June 16.

In an interview with Malaysian Industry at his office in Wisma Darul Aman, Alor Star, he talks about the coastal reclamation project and the types of industries he wants sited on the 14 man-made islands off the 100-km long Kedah coastline. Reclamation will come up to RM30 billion while the other infrastructure facilities will cost another RM80 billion.

When Sanusi mooted the idea, he viewed it as an environmental project through the reclamation of land initially. The project also hopes to solve several problems which Kedah is facing. Below are the excerpts from the interview:

Can you elaborate the problems which the project will resolve?

Number one is the oil spilled into the Straits of Malacca. One thousand ships pass through the straits everyday. There was a leakage on a ship and lots of fish died as a result.

Secondly, Kedah is the only coast in Malaysia which faces an ocean. As a result of the waves from the Indian Ocean and strong winds, our shores face a lot of erosion.

As a result of that soil erosion, we have the displacement of fishermen and destruction of mangroves. To preserve mangroves and not displace the fishermen’s villages, we have to check on this erosion.

That is why we position our reclamation away from the shore. That provides a wall between the Straits of Malacca and the shore. It will prevent the oil spills from getting to the shore, it will block the winds and waves from causing erosion and we can then start growing mangroves again where necessary. And in that canal which we call MSC, not the Multimedia Super Corridor, but Multipurpose Super Canal between the sea and the shore, then we will be able to have fishing and shipping there.

It (also) solves your problem of getting freehold title because most of the land in Kedah are Malay reserves. So when we develop (the land under this proposal) we have a problem of how we sell it to the non-Malays. You can’t convert it without causing political problems.

Land matter is a sensitive issue.

It is.

So you mooted the idea?

Yes, because I want to solve these problems. We can’t develop if we don’t have freehold land.

Please elaborate on the proposal to reclaim the nine islands.

It is between nine and 14. There is no line of demarcation there in the sea where one island should begin. So if some companies cannot afford to take too big an area, they can occupy a small area, they can create a small island. That 14 can be added up to be more than 14. We are quite flexible.

The figure nine was offered by Samudera Baru but from other recommendations and other proposals, it is possible to have more than 14. It could come to more than 300,000 acres.

What will be the total reclamation costs?

That will be about RM30 billion. It comes up to about RM1 million an acre. It is about RM25 per square foot. That is quite reasonable, similar to city land. It will have beach frontage and freehold title. You can sell it to foreigners.

What projects are you keen to have on the nine to 14 islands?

That is for private sector to work out. We will be doing the eliminating because we know what the others are doing. We don’t want duplication. We will only allow duplication later on if the need arises. For example, Samudera Baru, will have the airport not the sea port. The sea port is going to the other company for the Pulau Bunting (project).

What are the industries you would like to see on these reclaimed islands that are synergistic to Kedah?

The tourism industry, there will be also housing for those people who want to own houses like people owning houses in Australia and Florida. And there will be modern agriculture, some modern light sophisticated industries. According to the proposals, some want to have petrochemicals, independent power projects, these they can talk to the government. We are open. Once somebody wants to do an airport and if the next fellow also wants to build an airport, we will say no.

Then there will be two airports. One is proposed by Samudra while there is an existing one on Langkawi island. What about the competition since both will be quite near each other?

Well, yes. But if you look at (the northern region of Europe… at the top there, some airports are very close to one another.

Since the government is mooting the idea, it will be watching them to ensure there is no duplication.

We are only ensuring there are no duplication, either within the reclaimed area or duplication with the neighbouring state which will not benefit another.

How much will the reclamation come up to?

RM30 billion. It is not a very difficult to do because the sea is very shallow. You put a ship there, a dredge and suck up the sand and you have an island. It does not require very high technology. The only thing is people are frightened of the sea, that is why it appears very sophisticated.

How many companies are keen to take part?

So far, 10 companies have offered to participate. Some are RM2 companies we are not really interested in.

How many have you narrowed down to?

At the moment we are not narrowing the list because they might be RM2 companies but they might have more behind them. But we will review each case. We are not prejudiced in anyway.

Are the 10 companies local?

No, some are international while some are national companies.

Who are these foreigners who are interested?

I have not opened the applications yet. I just want to see one or two go first. I think everybody is looking for one project to go on first and then they will rush.

Which are the one you are evaluating?

Samudera Baru and the other company in Pulau Bunting.

Since Pulau Bunting will be a deep-sea port, what kind of facilities will be provided? Samudra had also wanted one with tanker facilities.

At the moment, we are ask them to concentrate on the airport.

So Pulau Bunting will be a deep-sea port?

Yes, at the moment. But that is subject to federal approval.

Land is a state matter and infrastructure is a federal matter.

Licensing is also a federal matter.

How do you see the port complementing the Penang port?

I don’t know. It is up to the private sector. If they want to do it, so they do it and suddenly if the port “tak laku” they lose their money. I am not losing anything. It is what these people want. It is only that we don’t duplicate within the state. It might duplicate with another state, but then I think they would have thought about it as they are the experts.

And the two companies are being assessed now?

We are confident these companies can finance the reclamation of the land.

About the reclamation of the islands. Are the fishermen responsive to the proposals?

The fishermen are receptive except for some NGOs, who come and tell them their future will be in jeopardy. But then they are not very impressed as they didn’t come (Gamudra) when their future was in jeopardy before. And the NGOs will come and say that we are destroying the mangroves. They are not impressed because the mangroves were destroyed anyway without the NGOs coming before. The NGOs involved here are only interested in opposing the government.

About 83% of those interviewed support or support strongly the reclamation project. About 14% oppose it because they are worried about their future. Another one or 2% (or 1.5%) will oppose anything. And those who are doubtful about the project will be convinced once they see results.

The state government is going through all the applicants. We want to make sure whoever gets it is just not a broker. Apart from the 10, there are 20 companies interested in the project because they thought the government is going to fund it and they want to be contractors.

A massive amount is needed under a comprehensive coastal protection programme, amounting to RM3 billion to rehabilitate the coast. So you moot the coastal reclamation idea and let the private sector work on it.

And they can sell anyway. It is from nothing. It is the sand from the sea and we get 20% free. If they reclaim 100 acres, we get 20%.

Under the 20%, will the state government will also be taking a stake in the company.

We take 20% free first. The stake in the company is an addition. Whatever other activity, we will also get rent. We are the ones going to give title on the 80%.

It is up to the state government to decide on what it wants to do with the 20%.

It is up to us. We will complement.

Samudera proposed to develop two islands.

No. When they were proposing, they proposed the whole lot when they heard me talking about it. But then we can’t give the whole lot to them.

So it will be parceled out to those…

To those we have faith in. But if for example after three years, some others are not doing too well, and then if they are doing well, they can probably take over.

Samudera was talking about tanker farms, petrochemicals, deep-sea ports.

They can talk so long so long as they can get the business people to be interested in the project. Tanker farms are not under the state. They can do anything on the island so long as they don’t run a brothel.

So on the islands, you want to see tourism, recreational and light and heavy industries…

Industries light and heavy. There should be some entertainment also. Maybe somebody will come with a Disney-type project … or like in the Gold Coast.

What is your perception from the economic spin-offs from the projects on these 14 islands?

To me, it will definitely very, very positive. It can’t be otherwise, Kedah is already enjoying almost full employment.

The projects will also be able to import workers from neighbouring countries.

Yes, they can come and our workers too. But we want them (our workers) to be doing higher level quality. That is why for example we have hi-tech industries in Kulim. But we have to train our people, that is why we emphasise a lot on training.

What role will the fishermen be playing. Will they be continuing their fishing activity?

Yes. With an increased population with richer people living on the islands, there is a need for a better quality fish and there will be rearing of fish, aquaculture, not just on land but in the sea, protected canal.

Their fishing methods should improve. They can also start their restaurants on the reclaimed land. The fishermen’s association and farmers’ association will have equity in the state’s companies that are involved in the land reclamation projects. They will own a share in our state company.

About the Indonesia-Malaysia-Thailand Growth Triangle (IMT-GT), from your description, Kedah will be the driving force in this growth triangle?

When I talk, I don’t talk about the growth triangle, but I am stressing on the spin-offs from this. I am developing this for Kedah, and Kedah is in the IMT-GT. But I don’t want to appear like a hero trying to help people, I am just helping Kedah and if it benefit our neighbor and our friends, God bless us all.