Kuala Lumpur | Johor Bahru | George Town | Kuantan | Kota Kinabalu | Kuching | Kota | Kuantan | Johor Bahru George Town Lumpur Kuala Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized of Competitive Cities inMalaysia of Competitive Achieving aSystem Achieving Main Report Achieving a System of Competitive Cities in Malaysia Main Report World Bank Reimbursable Advisory Service Social, Urban, Rural, and Resilience Global Practice November 2015 For further information refer to: Director General, Economic Planning Unit Prime Minister’s Department Block B5 & B6 Federal Government Administrative Centre 62502 PUTRAJAYA Website: www.epu.gov.my All rights reserved. No part of this publication may be reproduced, copied, stored in any retrieval system or transmitted in any form or by any means - electronic, mechanical, photocopying, recording or otherwise; without prior permission of Economic Planning Unit, Prime Minister’s Department, Malaysia. TABLE OF CONTENTS Acknowledgements ........................................................................................................................................ xi Glossary ....................................................................................................................................................... xii Key Facts ..................................................................................................................................................... xiii Overview .....................................................................................................................................................xiv 1. Introduction ..............................................................................................................................................1 1.1 Study Objectives .......................................................................................................................................................1 1.2 Defining Competitive Cities ..................................................................................................................................... 2 1.3 Methodology ..............................................................................................................................................................4 1.4 Context ....................................................................................................................................................................... 7 2. Building Economically Competitive Cities .................................................................................................11 2.1 Introduction and Analytical Framework .................................................................................................................11 2.2 Analysis and Broad Policy Directions ......................................................................................................................12 2.2.1 Low economic density .........................................................................................................................12 2.2.2 High transport costs and urban expansion .........................................................................................17 2.2.3 Inefficient urban form can undermine livability, affordability and environmental sustainability ....19 2.2.4 Potential for more efficient land use ..................................................................................................22 2.2.5 More flexible land-use regulations can increase economic density ................................................. 26 2.2.6 Coordination of land-use planning needs with transport infrastructure development ....................27 2.2.7 Strengthened institutional capacity for more effective urban planning ........................................... 30 2.2.8 Targeted interventions to formulate a more efficient system of cities .............................................31 3. City-level Analysis and Policy Review ........................................................................................................33 3.1 Introduction ............................................................................................................................................................. 33 3.2 Greater Kuala Lumpur ............................................................................................................................................. 35 3.2.1 Economic performance and specialization ........................................................................................35 3.2.2 Land use and spatial structure ............................................................................................................41 3.2.3 Low-use land in central Kuala Lumpur ............................................................................................... 49 3.2.4 Review of the development strategy ................................................................................................. 50 3.3 Johor Bahru Conurbation ........................................................................................................................................ 53 3.3.1 Economic performance and specialization ........................................................................................53 3.3.2 Land use and spatial structure ..........................................................................................................60 3.3.3 Review of the development strategy ................................................................................................. 62 3.4 George Town Conurbation ......................................................................................................................................65 3.4.1 Economic performance and specialization ........................................................................................ 65 3.4.2 Land use and spatial structure ........................................................................................................... 70 3.4.3 Review of the development strategy ................................................................................................. 76 3.5 Kuching ....................................................................................................................................................................79 3.5.1 Economic performance and specialization ....................................................................................... 79 3.6 Kota Kinabalu ..........................................................................................................................................................80 3.6.1 Economic performance and specialization .......................................................................................80 3.6.2 Land use and spatial structure ...........................................................................................................81 Malaysia: Achieving a System of Competitive Cities iii 3.7 Kuantan ....................................................................................................................................................................83 3.7.1 Economic performance and specialization ....................................................................................... 83 3.8 City-specific Recommendations .............................................................................................................................84 4. Strengthening Institutions for City Competitiveness ................................................................................. 87 4.1 Introduction .............................................................................................................................................................87 4.1.1 Methodology ........................................................................................................................................ 88 4.1.2 The history and context of urban governance in Malaysia ................................................................89 4.2 Analysis of Institutional Issues .............................................................................................................................. 91 4.2.1 The centralization/federalization of urban service delivery ............................................................. 92 4.2.2 Challenges in urban and spatial planning .......................................................................................... 97 4.2.3 Constraints faced by local authorities ................................................................................................99 4.3 Institutional Recommendations for City Competitiveness ..................................................................................104 4.3.1 Localization of Service Delivery ....................................................................................................... 104 4.3.2 Strengthening capacities of local authorities ...................................................................................113 5. Inclusive Cities: At Risk Youth in Urban Areas ..........................................................................................115 5.1 Introduction ...........................................................................................................................................................115 5.1.1 Background .........................................................................................................................................115