KUALA LUMPUR: Revival of the Bandar Malaysia mega-project should be thoroughly planned and studied to ensure it is in line with Malaysia's socio-economic growth, said economists.
Economic expert Professor Dr Barjoyai Bardai proposed for the 196-hectare land, located on the old Sungai Besi Air Force Base site, to be owned by government-linked companies (GLCs).
"Let GLCs like Khazanah Nasional or Permodalan Nasional Bhd buy the land. In the future, as the land value appreciates, the shares in the company will also appreciate in value," he told the New Straits Times.
He also said the project must be in line with sustainable development goals to preserve and improve the surrounding environment.
"It is time that we create a city within parks, filled with greenery and public parks for the people. We can still have tall buildings but we must try to think of ways to have spaces and economic activities underground so the surface will remain green and sustainable."
Barjoyai also said the development must take Fourth Industrial Revolution into account, creating futuristic facilities and features into the plans.
On Friday, Prime Minister Tun Dr Mahathir Mohamad announced that the Bandar Malaysia project, which was terminated in May 2017, would be reinstated with some adjustments made to the original plan.
The project would include the construction of a people’s park, 10,000 units of affordable homes, Bumiputera participation throughout the project, and priority for the use of local content in the construction process.
Commenting on the 10,000 affordable homes, Barjoyai said its concept must be re-evaluated. He proposed instead that the government could implement micro-homes, similar to Kuala Lumpur City Hall's micro-houses facility.
Economist, Professor Dr Mohd Nazari Ismail said it was important that the government did not borrow money to reinstate the project.
"The project is very risky because of the sluggish economic condition."
He said many Malaysians wanted to see a fast economic growth under Pakatan Harapan. Hence this placed pressure on the government to get the economy moving to satisfy people's expectations.
"Most people don't care about the long term effects of government debts."
Sunway University economics professor Dr Yeah Kim Leng said due to its strategic location, Bandar Malaysia would attract major international financial institutions and multinational corporations (MNCs) to set up their base here.
“Interest among MNCs would be growth-positive for the country’s economy. The spillovers will be very high, particularly in creating high-wage jobs and the sharing of business knowledge from the participation of leading international companies.
“Another possible gain is the potential synergies that can be derived from the integration of finance, technology and entrepreneurship.
“These are among the long term benefits for the country," he said.
Yeah said the 10,000 affordable homes was the most welcome addition to the high-value development project that lends credence to the inclusive development approach adopted by the government.
However, he said a concern which might arise with the Bandar Malaysia project revival was the oversupply of commercial properties.
Another economic expert Professor Hamzah Jusoh said the government must consider Malaysia's competitiveness and the comparative advantages of Kuala Lumpur city in the Asian region.
"The development of Bandar Malaysia should inevitably be able to strategise the specific development actions in order to rapidly enhance our competitive edges.
"However, as comparative advantages are seen to be very insecure and fragile, the government needs to be more concerned on strategies that will maintain and strengthen Kuala Lumpur's competitive advantages."
Last year, Dr Mahathir, after chairing the first Cabinet meeting following Pakatan Harapan (PH) victory in the May 9 polls, said the government would review mega projects initiated by the previous government.
The move undertaken in an effort to reduce government expenditure as well as debts.
The Bandar Malaysia project was announced in 2011 by then Prime Minister Datuk Seri Najib Razak. The 196ha integrated property development project was previously owned by 1Malaysia Development Bhd and was supposed to host the High Speed Rail terminus.
In 2017, TRX City Sdn Bhd undertook a share swap agreement with Iskandar Waterfront Holdings Sdn Bhd and China Railway Engineering Corporation (M) Sdn Bhd (IWH-CREC).
The deal involved the sale of 60 per cent of the issued and paid-up capital of Bandar Malaysia Sdn Bhd.
However, the deal collapsed due to breach in contractual terms when the parties failed to meet obligatory payments.
In an international open tender exercise participated by over 40 world renowned companies, including from Japan, Australia and the Middle East, the joint venture to take up 60 per cent of Bandar Malaysia Sdn Bhd was awarded to IWH-CREC.
The government said the consortium had committed to pay RM500 million in advance in addition to the original deposit of RM741 million within 60 days of the announcement on Friday.
Bandar Malaysia, which will be developed under the public-private partnership model, is estimated to have a cumulative gross development value of RM150 billion.