SPEECH BY YAB CHIEF MINISTER OF PENANG AT REHDA 41st ANNUAL DINNER ON 28TH OCTOBER 2015 AT G HOTEL
It is my privilege and honour to join members and associates of REHDA Penang who have collectively contributed significantly to the real property and housing industry in Penang. I wish to congratulate the organizing committee for the excellent manner in organizing REHDA’s 41st Annual Dinner Celebration.
We hope that REHDA can assist in fulfilling the state government’s aspirations of providing quality housing at affordable prices for the benefit of all the people of Penang.
The state government is aware of escalating property prices in Penang and has initiated pro-active steps to provide quality housing at affordable prices. The Penang State Government is actively pursuing the challenge of providing affordable housing which will see 22,515 homes being built over the next 5-7 years with another similar number to be built by the private sector.
The Federal Budget is disappointing for the affordable housing sector because it fails to address the 2 main issues haunting home buyers and developers in Malaysia as well as the stubbornly discriminatory and oppressive refusal of the Minister for Housing to grant approvals of Advertising Permits and Developers License (APDL) to private developers. The 2 main issues bedevilling the housing industry is the high rejection rate of application for housing loans, especially for lower and middle-income groups buying their first homes.
Many low-cost or low medium cost houses and affordable homes remain vacant not because of insufficient applicants but because they could not get loans. Why can't the loan requirements be relaxed for these houses to help first-time buyers? At present, the commercial bank’s rejection rate for housing is at about 50% to 60%.
We can build all the affordable homes we want but all our efforts would come to nothing if the rakyat who are in need of affordable homes are unable to get loans. The Penang state government has proposed that Bank Negara and commercial banks come up with specialized bank loan packages with low interest rates and easier approval process for affordable housing applicants.
The high loan rejection rejection is compounded by the refusal to lift the ban of Developer Interest Bearing Scheme (DIBS) for affordable homes and implement the government financial guarantee of commercial bank's loans for low-cost or low medium cost homes. As if these difficulties are not enough, the Housing Ministry have refused to approve APDL application within 2 weeks as is the practice.
There are now 47 APDL applications outstanding as at July this year, the longest a year in the waiting. This is unfair to developers and intended to punish Penang. That is why for the 3rd year running there is also nothing in the 2016 Budget for Penang!
In our pursuit to be an international intelligent city, the Penang State government has aggressively promoted Penang as a destination of choice for investment in higher value-added technology. Many multi national corporations have now made Penang their base for research, design and development.
Penang recorded RM 8.2 billion in investments in 2014, a 110% increase compared to RM 3.9 billion in 2013. For the 7 years period between 2008-2014, Penang recorded an investment of RM 48.2 billion, a 93% increase compared to the previous 7 years period 2001 to 2007 of RM 24.9 billion.
Further we have also signed a joint-venture agreement with Sime Darby Bhd to develop a RM3 billion High Technology Small and Medium Enterprises Industrial Park. We are also promoting Penang as a hub for shared services and outsourcing, particularly in business processing outsourcing (BPO).
Penang has signed a RM 11.3 billion joint-venture agreement with Temasek, Singapore’s national sovereign wealth fund with a portfolio worth SGD266 billion, to develop a high-tech industrial park in Batu Kawan and Business Process Outsourcing (BPO) hub called BPO Prime in Penang. With a GDV of RM1.3 billion, the new BPO Prime will create thousands of high-paying jobs in the services sector and spur the growth of our knowledge economy cluster.
Besides being one of the largest global electronics manufacturing hub, Penang is also a tourist destination with a world-renowned UNESCO World Heritage Site. Our talented and friendly people, good food and cultural heritage are our treasures that attract investors and tourists to Penang. Recently we were listed by Lonely Planet as the No.4 charismatic city in the world, beating out cities like Bombay, Manchester, Rotterdam and Rome!
We are also carving a niche as a leading provider of medical tourism for healthcare and currently have several major private hospitals that provide high-quality yet affordable healthcare to both local and foreign patients.
The state government listens to all and believes in advocating a better quality of life for the people of Penang through consultation and dialogue. The Penang State Government continues to uphold accountability in the affairs of the state as well as public policies.
We have established an outcome based administration and governance based on the principles of competency, accountability and transparency. We have taken the important steps of institutionalizing the fundamentals of rule of law, good and clean governance, as well as integrity in leadership.
I would like to take this opportunity to congratulate REHDA for taking the lead in assisting the less fortunate inmates from charitable homes through their Corporate Social Responsibility (CSR) initiatives. I strongly urge all developers and associates present here this evening to inculcate a CSR culture in all your companies. It has been demonstrated that it is possible to be profitable while also being socially and environmentally responsible.
In conclusion, I would once again want to thank REHDA for your invitation and your efforts in working closely together with the State Government to develop Penang. Together we look forward towards a brighter future for Penang.