Written reply to PQ on freezing or reducing land rent for JTC land as measure to help SMEs

Question:

Miss Cheng Li Hui: To ask the Minister for Trade and Industry (Trade) whether the Ministry will consider freezing or reducing the land rent component of the JTC Land Rental Scheme to assist our SMEs in view of the slowing economy and difficult business conditions ahead.

Written answer:

1. JTC benchmarks its land rents internationally to ensure that they are competitive. It also adjusts the rents based on local market conditions. Over the past year, JTC has reduced its land rents by between 8% and 17%, in line with market movements. It will continue to ensure that the rents remain affordable for our industrialists, including SMEs.

2. Apart from this, JTC has been supporting SMEs in other ways. For example, JTC has released more land through the Industrial Government Land Sales programme in the past five years. This has increased the supply of industrial space in the market. Market space rents have correspondingly moderated. From now till the end of 2017, about 3.0 million sqm of industrial space is estimated to come on-stream, which is higher than the average annual supply and demand in the last three years, of around 1.9 million sqm and 1.2 million sqm respectively. This is likely to exert further pressure on market rents. JTC has also improved market transparency by publishing more granular price and rental information on its website. In addition, JTC has developed, and will continue to develop innovative multiple-user ready-built facilities to strengthen the competitiveness of SMEs. These developments cluster companies and facilitate industry collaboration. They also contain shared facilities and services that help companies reduce their upfront capital investment and operating costs.