Saturday, March 30, 2013

Why Penang should just proceed with the tunnel

I am a Penangite and I am reading with surprise the amount of rejections from the NGOs (CAP as well) and some individuals viewpoint here. While environmental issues are a concern, one should know that for the past, one of the reasons why Penang has been under the rule (until March 2008) of the current sitting Federal Government is mainly due to the fear of being bypassed for development. Penang as a state has been bypassed for development for decades now, probably ever since the free port status has been taken away in the 70s. This is despite many times plea for reinstatement by Tun Dr Lim Chong Eu who was Chief Minister then. Even when we had a Penangite as a Prime Minister (and two Finance Ministers - Badawi and Nor Mohamed Yaacob), Penang has been bypassed. During then, the Iskandar Development in Johore was initiated. Monorail or any kind of major transportation system was not even introduced despite the Penang city really needed it.

The very people whom rejected to the tunnel and several link roads just do not (or refuse) to acknowledge what state government can and cannot do. There is obviously a limit to what the state government can do. I have been doing my search and realise that the amount of revenue the state is able to generate is pathetic compared to the federal government. In 2009, the state government for the first time managed to generate revenue exceeding RM1 billion.  My question is what is RM1 billion compared to what a federal government can generate? I would think most of the revenue that a state like Penang can collect are things related to land - assessment, rent, sale of state land, any transactions involving land transactions (from duties), billboards, sale of sands perhaps. For Penang, there are no loggings, very little agriculture revenue, definitely no oil and gas - basically very little natural resource to gain from.

Companies and individuals that are taxed from their profits and income - these goes to the federal government despite I would think Penang assisted to generate quite a few of them. In return, the federal government would re-distribute the revenue for states development. Obviously for Penang, usually that is a paltry sum - now probably worse.

Then, as a state government what should they do? Sit still and relying on the beauty of the beaches while trying very hard to promote the tourism sector of the state? Can, but you won't last long. To do that you need to develop the state. While people will want to remember the nostalgic experience of the Penang state during the 60s or 70s, obviously that is not possible without more development and better infrastructure.

For a state government, they have resorted to the earliest form of trading for progress (barter). Basically, they offer toll collections, land to be reclaimed for improvement of basic amenities (roads). Why? A Penang (or Selangor for that matter) state unlike in US for example is not able to raise state or municipal bonds - never have I heard of this in Malaysia. Without borrowings, your options are just very limited. Without development, that is equal to backward development for the state - do most Penangites want that?

Another thing which surprises me - these NGOs and some recalcitrant individuals mentioned of better transport infrastructure - buses, trams, monorails etc. Better infra means more money needed. Seldom have I seen public transport makes money - if they do, for the first initial years, much initial investments have to be spent. Spain, Singapore, Hong Kong, China spend hundreds of billions for their public infra but have yet to see direct return - indirect yes. This is social responsibilities where a government needs to provide. But for the government to do that, they need money - where is the Penang state government going to get that without increase in revenue? Bonds? Nope, as mentioned. Borrowings from the federal? Fat chance for now. Tell me what the state can do then.

Further, we want the state to build more public housing. We also want the state to build public housing on land that are today very expensive - in some parts of the island. Island is preferred over the mainland. Public housing is to be built on land that costs RM400 per sq ft or more. Is this logical? Does public housing need more capital injection from the state or is it a money generating affair? Public housing is very much needed, but it will just take up more state funds - which is why the state government has to find ways to generate more revenue.

The state government, I believe is looking at improving the state collections and revenue further for the future. With more revenue, then only more development can be further improved. Where are they going to increase their revenue? Again land, assessment, improving the infrastructure, tourism which also means more people into the state, real estate, more property transactions by the richer locals and foreigners - that is the only way to build their development warchest.

Hence, before any person reject, think before they do it. Social responsibilities cannot be improved without development - and the very group have been against development - of any massive scale - for a while.

7 comments:

Unknown said...

Hi Felicity,
can you analysis on MSC company ?
I've been invested in this smelting company some years, and I am a bit suffer for its management has never end of writting off a lot of investments. Can you help me to check out this company ?
Thanks.

felicity said...

MSC is not doing so well nowadays due to its uncertainty in Indonesia as well as the prices of tin is on downtrend now

cbteh said...
This comment has been removed by the author.
cbteh said...

I'm a Penangite myself. I totally support for this tunnel. The state government is looking into future problem, perhaps next 10-20 years. I was totally in shock, after what I read in google. Penang has more vehicles than the population! Penang has more than 2 mil vehicles whereby the population stand at only 1.6 mil. Let alone 120K vehicles add in into the island each year.

The best solution is MRT and good public transport system. Of course without the fund and federal government approval, it is nearly impossible. So, the next best option is to build road.

Black Ink said...

What Penang needs is proper WasteWater Treatment & Management. Aren't Penangites tired of the stench at low tide? What about the atrocious jellyfish infestation brought about by raw sewage, pollution and algal bloom?

Black Ink said...

For people based outside Penang, and my Kiwi mates from New Zealand, one dip in that toxic swill you call a beach ended up in jellyfish stings for one of us, the the rest high-tailing it out of the water.

How long more can Proud Penagites put up with this crap. First things first. Deal with your toxic water pollution as a priority please!

CheahSweeKuan said...

Penang has been bypassed for developement when that Apanma took over the premiership. He denies Penang a good MRT system. A responsible PM will dutifully look after every state and should get what the state deserves but then again this cannot come from him. It is obvious he has a strong dislike for Penang as he has for Singapore. These people are what we call satu macam. I am not sure I can use the word bigots,, but we know what he is.