Malaysia: Transforming Transport


Economic News

22 Jul 2010
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On January 27, Prime Minister Datuk Seri Najib Tun Razak released a new policy roadmap aimed at transforming the way the state provided services in six national key result areas (NKRAs), including combating crime, raising living standards for the public, education, rural infrastructure and transport systems. The scheme, the Government Transformation Programme (GTP), foresees the Transport Ministry increasing rolling stock and extending the existing light rail grid, adding hundreds of buses to the public transport fleet and speeding up the completion of the electrification and double-track network.

The specific goals set out under the NKRAs is to increase public transport usage from the current 10% travel to 13% by the end of 2010, to ensure that 75% of the urban population is within 400 metres of a public transport access point, and increase reliability and punctuality of services. According to the plan, the initial focus for these objectives will be in the Klang Valley before similar programmes are rolled out in Penang and Johor Bahru.

Rather than just being another state spending plan, with most of the capital outlays for the transport sector envisioned have already been committed plans, the NKRAs and the wider GTP are part of the government’s campaign to increase accountability, setting clearly defined targets accompanied by firm timelines.

Another plank in the government’s urban policy platform is the Suruhanjaya Pengangkutan Awam Darat (the Public Land Transport Commission, SPAD), announced by the prime minister during his 2010 budget speech in late October. Scheduled to begin operations as of June 1, 2010, SPAD is to be the sole authority tasked with monitoring and enforcing service standards as well as putting forward a long-term plan for urban public transport.

According to the transport minister, Datuk Seri Ong Tee Keat, SPAD will serve to improve public transport services and promote greater passenger usage.

“The role of SPAD is to formulate and govern all matters pertaining to public transport in line with the government’s aim to develop an integrated, efficient and reliable public transport system consistent with our objective of encouraging a modal shift from private transport to public transport,” he told OBG in a recent interview.

While Malaysia’s cities have extensive public transport networks, they are underutilised, in part a reflection of high private vehicle ownership and also of the perceived lack of transport dependability. Working directly under the prime minister’s department, SPAD will have to not only oversee efforts to improve the public transit system, but also the public perception of it.

A long-term target of the ministry is to increase rates of public transport usage to 25% by 2012. One route towards this destination is the plan to lift the role the private sector can play in the implementation of transport developments.

According to Ong, the Transport Ministry is currently reviewing the list of transportation projects that would be suitable for development through the public-private partnership (PPP) model.

“This approach encourages the participation of the private sector in the development of the nation so that the responsibility does not rest solely on the government,” he said. “PPP could provide the government with more choices on the development of the country. Through PPP, the private sector will need to share the risk of the projects and also be responsible in funding and developing the infrastructures involved.”

Though hoping to encourage the private sector to buy into infrastructure projects, the state itself is continuing to step up its own outlays, with the Transport Ministry having been allocated more than $130m as part of the government’s two economic stimulus packages. These funds, which came on top of standard budget allocations, have been earmarked to support the rail, aviation and maritime sectors, with much of the money being directed towards capital developments intended to boost freight moving capacity.

While new planning and coordination authorities, targeted outcomes and increased spending should all combine to further strengthen Malaysia’s transport infrastructure, and thus positively impact the country’s economy, it might take time for the full effects of these reforms to be felt. However, if the government can encourage the public to leave their cars at home, increased usage of state-provided transport could help build a momentum towards mass transit options, at the same time boosting investor interest.

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