New financial district launched
Prime Minister Najib Razak yesterday announced the launch of a special task force to oversee the development of the Kuala Luimpur International Financial District or Tun Razak Exchange as it will now be known.
The project, in the heart of Kuala Lumpur, will comprise of 70 acres of retail, offices, hotels, residences, a signature 380m tall tower and mass rail transit station; around 30% of the site will be publically accessible green space.
The pertinent part of the prime ministers speech as published on the prime minister’s office website is as follows:
“The Tun Razak Exchange is a 70-acre haven for new investment opportunities, estimated to generate a gross development value of RM26 billion. It will encompass world-leading international design and progressive planning tenets; its buildings and infrastructure will conform to the highest levels of sustainability; pedestrians will be able walk and play in green public areas; and it will have seamless links to public transportation, including the MRT.
We also expect more than 250 of the world’s leading companies to locate here, creating 500,000 jobs directly and indirectly by the time it is fully completed. 40,000 will be knowledge workers specified to financial services, reflecting our ambition for the Tun Razak Exchange to be home to a strong, vibrant and diverse international business community.
Additionally, to ensure that the exchange receives the support of the entire Government machinery every step of the way – from planning and development right until the exchange is fully up and running – we have formed a special task force led by the Economic Planning Unit. I have appointed YB Tan Sri Dato’ Nor Mohamed Yakcop as chair and its members include senior officers from the Ministry of Finance, Bank Negara Malaysia and the Securities Commission as well as other agencies.
The Government will go out of its way to ensure that the exchange is a success – and as a first step, I can announce to you today that we will begin a comprehensive review of business regulations. Our logic behind this review is simple: anything that contributes to future progress stays, anything that is outdated goes.
I can also announce that further incentives are in the pipeline, building on those I announced last year. These include: an income tax exemption of 100 per cent for 10 years; stamp duty exemption on loan and service agreements; Industrial Building Allowance and Accelerated Capital Allowance; and an income tax exemption of 70 per cent for five years for eligible property developers in the Tun Razak Exchange.
We remain steadfast in our commitment to creating a large, vibrant and successful financial district in Kuala Lumpur. With the support of Bank Negara Malaysia, the Tun Razak Exchange will play a major part in turning this great city into an international financial centre.
In particular, we hope to see a further development of Islamic finance – a sector of unlimited potential. Worth just $5 billion in 1985, the Islamic finance sector is worth more than $1 trillion today. Malaysia’s Islamic finance sector is already worth more than $400 billion and that is set to triple in value over the coming decade. I am committed to doing everything I can to make it easier for investors to participate in Malaysia’s Islamic finance markets – and further strengthen our position as a global hub for Islamic Finance.
As I have set out, there are many other reasons to invest in the Tun Razak Exchange – and I am pleased to announce we have locked in our partner for the entire of Phase 1. It is significant to note that this international partner is the first mover in establishing a strong ecosystem to support the infrastructure for the exchange. There will be a strategic investor that will be bringing in more than RM3.5 billion in FDI. There will be a special ceremony in September this year to mark this during which the identity and details will be announced.”