Johor is mulling the introduction of a new incentive which may be in the form of a five-year tax exemption, especially for foreign investors keen on investing in northern Johor, says Menteri Besar Osman Sapian.
Osman said today that the incentive would encourage foreign investment in the region, which has received less attention from investors compared to the southern part of the state.
However, he said full details of the incentive was not yet finalised, as the government needed to take into account feedback from members of the recently established Johor Economic Council.
“I expect the details to be ready within a month. This (incentive) is an encouragement for them (foreign investors) to venture there, but they have to abide by certain conditions, such as recruiting locals and paying then a salary not less than RM1,500,” he told reporters after visiting state-owned company, YPJ Holdings Sdn Bhd in the state capital.
Osman also said the incentive was not intended just to develop the state’s northern region, but to discourage the migration of people to Johor Bahru.
“If we look at the statistics, these areas (northern region) are scarcely populated. Why? Because of a lack of job opportunities (there),” he said.
Meanwhile, Osman said he had requested YPJ to diversify into new areas to maintain its profitability without relying on its existing core sectors such as plantation.
He said YPJ should consider commercial farming and the export of herbs such as lemongrass, ginger, galangal (lengkuas) and turmeric, which can be cultivated on YPJ-owned land.
Osman urged YPJ to take advantage of the state government’s plan to develop several districts, such as Mersing for tourism and Segamat for agriculture.
“We need to consider new ideas and directions to seek profit. YPJ will face strong challenges in the future especially since it owns thousands of oil palm plantations which are no longer as profitable due to falling prices.
“Last year, YPJ reaped RM17 million in profit from its plantations when it, by right, be earnings between RM40 million and RM50 million as in previous years,” he added.