(Bloomberg) -- Singapore and Malaysia are close to finalizing plans to develop a special economic zone that seeks to boost trade and connectivity. 

The two neighbors are “very close” to a final agreement on the SEZ in Malaysia’s southern Johor state, the country’s Prime Minister Anwar Ibrahim said, citing initial briefings.   

“I would even drop into Singapore to meet the potential investors to encourage them but we have to get the parameters and issues resolved,” Anwar said in Kuala Lumpur on Wednesday at a joint press briefing with Singapore’s Prime Minister Lawrence Wong.

Earlier this year, the two countries agreed to jointly develop the SEZ but have yet to announce a specific location. Johor last month suggested creating a Shenzhen-style hub comprising Iskandar Malaysia, home to struggling property development Forest City, and petrochemical hub Pengerang.

The countries are also working to complete the Rapid Transit System between the Malaysian state’s Johor Bahru city and the northern part of Singapore by 2026. The rail link will have a peak capacity of up to 10,000 passengers per hour per direction.

“If we can press forward with good master planning, clear and consistent policies around the SEZ, with the RTS coming alongside, I think it will unlock a lot of economic benefit for both sides,” Wong said at the press conference.

Wong added that he’s willing to hear fresh proposals on a high-speed rail line between Kuala Lumpur and Singapore. The on-again, off-again rail link project was terminated in 2021. 

The leaders also discussed long-standing issues related to water supply as well as airspace and maritime boundaries in their first meeting since Wong took office in May. Anwar said he hopes to resolve bilateral issues before the annual Singapore-Malaysia leaders’ retreat at the end of the year.

 

--With assistance from Norman Harsono.

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