Economy of Johor
At the southernmost tip of Peninsular Malaysia lies the state of Johor. Wrapping around the island nation of Singapore, Johor is an economic powerhouse unto itself. Boasting a GDP of approximately 20 billion dollars annually, and growing at 5% or more each year, Johor continues to expand onto the regional and global economic stage.
This growth is fueled by a number of strong industries, such as finance, ICT, and biotechnology, most of which are located in the state capital, Johor Bahru. The main strength of Johor, however, is manufacturing, especially in the food and agriculture, petrochemical, and electronics industries. The key sector enabling all of this activity is the maritime, shipping, and logistics industry.
A large portion of Johor’s economic activity is supported and facilitated by Johor’s thriving maritime transportation sector.
Looking at the location, we are towards the eastern side of the Strait of Johor, and of course, we are in the midst of the East and West international trade lane. But given the infrastructure that we have today, Johor Port mainly focuses on Intra-Asia trade. So our connectivity is mainly to connect from here to the ASEAN and also the Intra-Asia region.
The heart of this activity is the Iskandar region – a development area that encompasses five flagship zones and the major ports within them. Together, the ports of Johor see millions of tonnes of products each year, and offer companies with assistance in processing, packaging, and warehousing their goods.
The port is the agent for development. I mean, you can see that the industrial, the residential, the commercial development in a way started from the port. So wherever you have ports, it will create development. So a port is the catalyst for development.
Whether it be containers, liquids, or other cargo, Johor is a major waypoint and destination for companies in the region and beyond. And as an emerging leader in shipping technologies, Johor is home to increasingly advanced transportation and logistics systems.
With these advantages, along with cost-effective access to a wide variety of Southeast Asian markets, the Strait of Johor sees an ever-growing percentage of global trade each year.
The busiest of the ports in this bustling corridor is Johor Port.
Since 1977, Johor Port has operated as the original multi-purpose port in Malaysia’s Southern Gateway. As the first such free zone port, Johor Port has leveraged its proximity to major eastern markets to become one of the most active shipping lanes in the world.
Johor Port is the main entry point in the southern region for local cargo. Manufacturers and warehouses are depending on Johor Port to ensure that the cargo comes in and out smoothly. In this manner, it’s also related to logistic activities and the existence of the warehouse, the trucking services, the efficiency of the customs declarations, and customs requirements are important to the local community. Looking at Johor itself, there is a massive development over the rapid area and whereby, Johor Port and as well as JP Logistics can take this opportunity to support the rapid development. In fact, if I can add, its capitalizing not only for Johor State but also in Singapore because there are a lot of companies moving up from Singapore to the Johor site.
Johor Port’s total area encompasses 1,000 acres, more than half of which are designated as Free Zone territory. Johor Port’s central location, capacity, and ability to provide ancillary services make it a primary destination for shippers.
As a result, Johor Port is currently the biggest palm oil terminal in the world, and processes a variety of other products as well, including rice, cocoa, and London Metal Exchange cargo.
Johor Port’s current capacity is roughly 40 million TEUs. According to development plans, however, over the next five years, total capacity will increase to 80 million tonnes annually.
The container shipping industry is an evolving industry; it changes every year. In the next 5 to 7 years, we can see significant changes in industry in terms of environment, regulations, security, business ethics, label standards, and technology. Technologically, we need to be in line with the growth; our vessels are getting bigger. Now, in Johor Port itself, our online system is integrated, we have our own ship lining modules. We also have our free zone system, which is all integrated into one, and we are continuously improving to make sure that it meets the demands of the shipping community itself.
The economy of Johor continues to grow and thrive, thanks to the natural advantages created by its proximity to the sea, and to some of the region’s foremost transportation facilitators: the ports of Johor.
Johor Port, we started in 1977, it’s more than 30 years now. You can see that the development of industries within this area in Pasir Gudang where we belong, we are part of Pasir Gudang, so it has actually fully developed the industry within Pasir Gudang and it has extended to other areas. So it has opened up other industrial areas as well. So to me, this is the significance of the port and this is the value that Johor Port has contributed to the state in particular, and the southern region as a whole.