Delay in Johor-Singapore SEZ deal sparks uncertainty for SMEs’ growth and investment plans

SINGAPORE: The delay of the Johor-Singapore Special Economic Zone (JS-SEZ) deal to January, originally planned for Dec 9, may leave small and medium enterprises (SMEs) uncertain about their plans for growth and investment, Singapore Business Review reported.

Dr Cai Dailu, a senior lecturer at NUS Business School’s Department of Strategy and Policy, said the delay could impact how SMEs approach the agreement.

He explained that uncertainty over the signing might lead businesses to adopt a cautious, “wait-and-see” approach, which could limit the agreement’s full potential.

The delay also comes at a time of global economic instability. Dr Cai pointed out that right now, the “world is really unpredictable.”

He added that the uncertainty is not limited to this region, noting, “We don’t really know how global trade would be affected under the new administration in America, for instance.”

The uncertainty also builds with the added risks of trade wars and tariffs.

Dr Cai explained that the SEZ agreement could play a key role in reducing these risks by encouraging collaboration and building a stronger investment framework. He said it could help businesses withstand potential economic shocks.

However, he also noted that the delay itself increases unpredictability for businesses, making it harder for them to plan ahead.

Despite this, Dr Cai emphasised the importance of agreements like the JS-SEZ, saying they are vital for fostering regional cooperation and helping companies navigate an “unpredictable macroeconomic framework.” /TISG

Read also: Singapore-Johor special economic zone deal to be “hopefully” signed in November

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