Tuesday, July 31, 2012

Task force to oversee Tun Razak Exchange development

KUALA LUMPUR (July 30, 2012): The government, which will announce the key foreign investor of the RM26 billion Tun Razak Exchange (TRX) in September, has set up a special task force led by the Economic Planning Unit to ensure that the development receives full support from the entire government machinery.

Minister in the Prime Minister's Department Tan Sri Nor Mohamed Yakcop has been designated to lead the task force, whose members include senior officers from the Ministry of Finance, Bank Negara Malaysia and the Securities Commission.

"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 (yesterday) 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 Our logic behind this review is simple: anything that contributes to future progress stays, anything that is outdated goes," Prime Minister Datuk Seri Najib Razak, who is also chairman of 1Malaysia Development Bhd (1MDB), said during the launch of TRX yesterday.

The special task force will oversee the mega project, from planning and development to completion.

It will review and put in place policies and regulations that are more business friendly for the international business community to transact in Malaysia, making it more attractive to investors.

"Further incentives are in the pipeline, building on those that I had announced last year. These include an income tax exemption of 100% for 10 years; stamp duty exemption on loan and service agreements; Industrial Building Allowance and Accelerated Capital Allowance; and income tax exemption of 70% for five years for eligible property developers in TRX," said Najib.

The premier also announced that 1MDB has locked in its partner for Phase 1 of TRX, an international partner that will be the first mover in establishing a strong ecosystem to support the infrastructure for the exchange.

"There will be a strategic investor that will bring in more than RM3.5 billion in foreign direct investment. There will be a special ceremony in September to mark this, during which the identity and details will be announced," Najib said.

He added that the government hopes to see further development of Islamic finance with the setting up of TRX.

"Malaysia's Islamic finance sector is already worth more than US$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," said Najib.

Formerly known as the Kuala Lumpur International Financial District (KLIFD), over 250 of the world's leading companies are projected to locate to the 28ha TRX in the Imbi area fronting Jalan Tun Razak, creating 500,000 jobs by the time it is fully completed. Of these, 40,000 will be knowledge workers, specifically for the financial services sector.