KUALA LUMPUR, Jan 27 — Bagan MP Lim Guan Eng has formally appealed to Prime Minister Datuk Seri Anwar Ibrahim to approve a Special Financial Zone (SFZ) in Penang, arguing this was crucial to protect the state’s economy from the threat of new US tariffs on the electronics sector.
In a statement, Lim disclosed that he met the Prime minister on January 16 to make the case for an SFZ in Bagan (Butterworth), on the mainland.
He stressed the “added urgency” of diversifying Penang’s economy, which is 95 per cent dependent on manufacturing and services, making it highly vulnerable to the US-China trade war.
“Despite the Agreement of Reciprocal Tariffs (ART) concluded with the United States last year fixing tariffs at 19 per cent, the electronics sector was not included as part of the ART.
“As Penang’s mainstay industry, this has caused great uncertainty,” Lim said.
He warned that if US President Donald Trump carries out his threats to impose tariffs of 200-300 per cent on these goods, it would be “disastrous” for Penang’s economy.
Lim argued that an SFZ, similar to the one in Johor, would provide a vital “economic anchor” for the state.
He proposed a 70-acre state-owned site in Ampang Jajar, Bagan, which he said would also promote balanced development between the island and the mainland.
According to Lim, the prime minister was receptive to the idea but indicated that there was “no intention to approve an SFZ in Penang for the time being,” as the Johor SFZ was still in its early stages.
However, Lim expressed strong belief that the Ampang Jajar proposal could succeed for three reasons: it is on government-owned land, it is located in Seberang Perai to improve economic balance, and it is situated within Penang’s key transport and communications hub.
The appeal marks a new application strategy after the Finance Ministry rejected a previous submission from the Penang state government, which had proposed three privately-owned sites on the island.
The new application will now include the state-owned mainland site alongside the three island locations.