Penang call to address home prices, FDIs

Property News/ 7 October 2010 Leave a comment

GEORGE TOWN: The Penang business community is seeking measures on affordable housing and improving foreign direct investments (FDIs) as well as incentives for local and multinational companies to reinvest under Budget 2011.

Real Estate Housing Developers’ Association chairman Datuk Jerry Chan said in view of the high property prices, the Government should consider revamping the way public housing was being subsidised.

“The Government should instead look at developing public housing and renting them to the lower-income group as practised in the UK,” he told StarBiz.

He said this group, which already had difficulties to make ends meet, would also not be burdened with the need to buy a low-cost property.

“The present system requiring the developer to build public housing only increases property prices, as the cost of development is passed on to purchasers.

“To bring down the price of properties, the Government should look into subsidising building materials,” he said.

The Government should also consider giving grants to first-time home buyers, he said, adding: “The grant should be given to purchasers of homes priced below RM250,000.”

According to the Valuations & Property Services Department at the Finance Ministry, in 2009, the residential property pricing in Penang had soared above that of Kuala Lumpur by over 2.5%.

The housing price index of Penang was 145 in 2009, compared with 142 in Kuala Lumpur and the national average of 130.

GUH Holdings Bhd managing director Datuk Kenneth H’ng said the Government must quickly arrest the decline of FDIs.

“It must provide more attractive incentives to pull in investments as there are now new competing destinations in the region,” H’ng said.

Malaysian American Electronics Industry chairman Datuk S.H. Wong said the budget should provide grants for local companies and multinational corporations to reinvest and grow technologically, creating more high-value technological positions.

“This will prevent them from shifting elsewhere. The Government should not increase the foreign levy, which is currently at RM100 monthly per worker, for all business sectors. It should raise the levy in sectors where automation and productivity is low.

“The Government should also look at lowering the electricity tariffs for companies that achieve more in terms of value and quantity with their usage of electricity,” Wong said.

Meanwhile, Malaysian Association of Hotels (Penang chapter) chairman Marco Battistotti said to enhance the country’s competitive edge in the tourism industry, the Government should consider giving tax incentives to hotels that wanted to upgrade their buildings in accordance with green environment guidelines and to re-train their workers to meet a more competitive tourism environment.

“Such tax incentives will spur those hotels, which had been around for more than 15 years, to renovate and to provide better services,” he added.

SOURCE: The Star

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