GEORGE TOWN: Investors were assured today of renewal of leases on state-owned industrial land in Penang, some of which are due to expire in 10-15 years.
Penang Chief Minister Chow Kon Yeow said the leasehold on industrial lands was usually for 60 years, adding that some of the lease on the lands would expire in the next 10 to 15 years.
“We want to keep the industries here in the hopes that they will expand their operations and create more jobs,” he said. “As such, the issue of lease extension does not arise. We will definitely want to extend but we have to study the implication of the premium on the cost of operation,” he told reporters.
He said a study will be conducted to determine the amount of land premium that the state can charge for the new 60-year lease.
“For example, 50 years ago the land was a coconut plantation, so it is no surprise that it costs only about five cents to 20 cents then, but today, the land is a mature industrial zone, so the valuation will have to take into consideration all these matters,” he said.
Chow said land revenue is the biggest source of revenue for the state government, adding that the state will rely on the Valuation and Property Services Department to recommend the land premium.
“It is the government valuation agency that will assess the value of the land and recommend the premium to be charged. “We will follow the premium assessment as recommended by the department, and the process is very transparent,” he said.
Chow said that companies may apply to extend the lease on their industrial land now instead of waiting until it expires. “Let’s say you have 10 years left, you can already start to apply for the extension, you don’t have to wait until 60 years to apply,” he said.
Chow spoke to reporters after launching a book on Penang’s economic development, entitled “From Free Port to Modern Economy: Economic Development and Social Change in Penang – 1969 to 1990”.