Johor, also known as the “Southern Gateway of Malaysia”, is the second largest state with an area of 19,016 km2. It is one of the most developed states in the nation and is bounded by:
- Melaka, Negeri Sembilan and Pahang in the north;
- South China Sea in the east;
- Straits of Johor in the south; and
- Straits of Melaka in the west
Johor’s economy has grown tremendously over the past several years. The development was attributed to the growing industrialization and diversification of its economy base. Its hallmark stability, competitiveness and highly conducive business environment positions the state as one of the best investment destinations in the Southeast Asia Region.
SUB DIVISIONS OF JOHOR
(As per 2015)
- Office of the Johor’s State Director of Lands and Mines
- Department of Statistics Malaysia
RM93.7 billion GDP in 2014
top investment destination between 2010 and 2015
3.61 million people
2nd largest population in Malaysia
3 major seaports
to dock and transfer cargo smoothly
that offer a vibrant skilled community
6 hours flight radius
to major Asian cities and markets (40% of world’s economic output)
The Johor state has a very stable and pro-business government who is constantly looking to partner with investors to bring economic development to the state. As a result, the Johor state has been the highest recipient of investment in the country since 2010. For the first sixth months of 2016, the state managed to attract RM5.4 billion of investment, nearly double the second highest ranked state in Malaysia.
Enjoy the advantages of a developed state without its burden
Johor has a wide economy base, from low value-adding to high value-adding industries, supported by well-established infrastructure. The cost of doing business is very competitive and is generally 30% lower than Kuala Lumpur and 60% lower than Singapore.
Be part of the next growth centre
Johor has high growth potential and rapid development which investors can leverage on. Since 2010, the Johor state has been the highest recipient of investments in the country. Investors are encouraged to invest in the state to enjoy first mover advantage.
Close proximity to largest markets in ASEAN
Johor is located within a 6-hour flight time of major international cities, which is home to 28% of the world’s population that also accounts for 40% of the world’s economic output.
Greenfield development for new growth ideas and innovations
Being one of the largest states in Malaysia, Johor is well positioned to exploit this advantage in offering greenfield development solutions to potential investors. This greenfield development solution will enable investors to constantly search for new growth ideas by conducting active research, sharing research ideas, encouraging new business models and promoting an innovative culture.
Home to two economic corridors
There are five economic corridors in Malaysia and Johor is the only state that is home to two economic corridors: Iskandar Malaysia and the East Coast Economic Region.
Strong, Multilingual, Diverse Talent Pool
Johor has a ready pool of multilingual (English, Mandarin, Tamil, Hindi, Malay, Japanese, and Korean) technical talent that is available at an affordable cost with the established and upcoming presence of tertiary and technical education institutions.
Most liveable developed state in Malaysia
Johor is more affordable to live in compared to other developed states/cities in Malaysia and Singapore. Despite being in close proximity to Singapore and Kuala Lumpur, Johor’s cost of living is 68% and 16% lower than these two cities. From a safety perspective, Johor is getting increasingly safer as crime rates declined by 33% between 2010 and 2014. Travelling within the state is also easy as traffic is significantly less congested than other developed states/cities. Residents in Johor are also able to enjoy quality healthcare and education services as more international institutions are setting up their bases in Johor. All these services are available at competitive prices vis-à-vis other states/cities.
Prior to 2008, the Acerinox group was operating a service centre in Malaysia providing sales and marketing support in the region. In 2008, the Acerinox group decided to embark on a new venture by establishing a fully integrated stainless steel mill in Johor known as Bahru Stainless Sdn Bhd. The decision to make Johor the home of the integrated stainless steel mill was an easy one. It has unparalleled port facilities which is crucial for our line of business. It helped us to move materials and products, especially since 70% of our products are exported. In addition, the availability of strong and multilingual talent pool that is well versed in English also played a strong factor in our decision. As a greenfield development project, the Johor state government and Johor Corp were instrumental in helping us set up our business here. We even have an almost dedicated port for us to move our materials as part of the first mover advantages. In 2012, less than 4 years after the idea was mooted, Bahru Stainless began its operation and it will be operating at full capacity in 2022 when the final phases of the mill are completed. Strategically, we think that Johor is the best location for someone who wants to grow in the Southeast Asia region.
Our Johor facility is an integral part of Seagate’s hard disk drive production globally as the facility supplies a large portion of Seagate’s total requirement for aluminium substrates. Seagate decided set up our substrate facility in Johor as the state has a favourable cost structure and availability of skilled labour to drive our company growth in the region. The decision also allowed us to streamline our production as our next manufacturing process (Seagate Recording Media Operations) is located in Woodlands, Singapore. Our investment experience in Johor has been good as we received strong support from both the federal and state government when setting up our substrate manufacturing facility in Johor. There are also good local supporting industries available in Johor to support our operations’ needs.
When Evyap Group was considering which country and region to invest in, we had a vision for Johor to become the regional hub of our operations due to its well-established infrastructure. In addition, Johor is one of the two important oleochemical hubs in Malaysia which allows us convenient access to raw material supplies as well as securing oleochemical-related services. The established industrial base helped our transition in building up our business here.
Another advantage that Johor offers is its close proximity to Singapore where many multinational headquarters are located. With that, it is easier for us to get in touch with customers, key business partners and decision makers. The speed of doing business here is significantly faster.
As a major exporter, we are able to get quick and easy access to shipping services via the Tanjung Pelepas Port and Johor Port. In addition, the Singapore Port is just right next door. This offers a lot of flexibility in how we can organise in a very fast and efficient manner. Such flexibility is rarely found in other places, but very crucial to an exporter like us.
Imagine a location equipped with world class infrastructure and abundant land for greenfield development. Imagine a location that is situated close to one of the most admired cities of the world. Imagine a location that within 60 minutes to the best airport in the world. Imagine a location that is a perfect test-bed for new growth ideas and initiatives for global expansion. Imagine a location that has a high degree of liveability with access to world’s best education institutions. What if all these came with a relatively low cost structure and cost of living? Guess what? This is the state of Johor that I was talking about. Johor is a game changer for many companies, including Frost & Sullivan. Is it a game changer for your company?
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