KKKH 4284

URBAN PLANNING AND SUSTAINABLE

DEVELOPMENT

TASK 3

JULIANIZA ARIFFIN

A132737

DEPARTMENT OF CIVIL &

STRUCTURAL ENGINEERING

THE NATIONAL UNIVERSITY OF MALAYSIA

JUN 2014

1.0 INTRODUCTION

Kajang Municipal currently has exciting and ambitious plans for development of the

2.4 ha piece of public square which was built in 1970’s into an Innovative Research

Park. The investment of millions ringgit Malaysia by Kajang Municipal Council

(MPKj) from Government will paves the way for developing a thriving research and

innovation campus over the next decade and beyond.

(a) (b)

Figure 1: Kajang Stadium in before reconstructed and after reconstruction in

2010

Set in a central part of the Kajang and connected with many established centre

of research excellence in biotechnology, manufacturing, consulting and, Kajang

Innovation Research Park encourages collaboration between business and academia

allowing both to flourish in a mutually supportive environment. From supporting spin-

out and start-up companies to providing flexible laboratory and office accommodation

and facilities for Small Medium Entrepreneurs(SME) and growing companies, the

Research Park will become the hub for business and technology and become national

centre of sciences research with expertise in the research and development pipeline

from nearby institutions.

Additional works to deliver improvements to the car parks, lighting, road

junctions and IT infrastructure that will allow the longer term development of the

Research Park will be accommodate by private sectors using privatization method.

Reasons for privatization :

1. To reduce the burden on Government

2. To strengthen competition

3. To improve Public finances

4. To fund infrastructure growth

5. Accountability to shareholders

6. To reduce unnecessary interference

7. More disciplined labor force

2.0 PRIVATISATION CONCEPT

Privatization process to develop the the public square area into a Research Park was

defined in several alternatives :

1. Transfer of ownership from the Public to Private sector.

2. Transfer of Management of an Enterprise from the Public to Private sector.

3. Withdrawal of the state from an industry or sector partially or fully.

4. Opening up of an industry that has been reserved for the Public sector to the

Private sector including governmental functions like revenue collection and

law enforcement.

One of the main highlights for the privatization of publicly owned operations is

the estimated increases in efficiency that resulted from private ownership. The

increased efficiency is expected to come from the greater importance private owners

tend to place on profit maximization as compared to government, which tends to be

less concerned about profits.

Normal medium companies start as private companies funded by a small group of

investors. As they grow in size, they will often access the equity market for financing

or ownership transfer through the sale of shares. In some cases, the process is

subsequently reversed when a group of investors or a private company purchases all of

the shares in a public company, making the company private and, therefore, removing

it from the stock market.

Modes of privatization :

1. Sales of an enterprise

2. Sale privatization a global phenomenon

3. Improves operating and financial performance

4. Lease of entity

5. Joint ventures

6. Public share offers

The methods of privatization normally adopted :

1. Generous pay and benefits.

2. At lower levels in particular.

3. Overtime.

4. Offer of shares through a Public offering both domestic and global, which may

or may not involve a change in ownership/management.

3.0 RESPONSIBLE PARTIES

Government

1. Transfer of the land title to the developer.

2. Give assistance to relocate the squatters and land owners.

3. Give assistance to transfer the ownership of part of the area from land owners

to the developer.

4. Allow the developer to construct a modern mega commercial building.

5. Give assistance to get necessary approval.

Developer

1. Construct infrastructure network, including two grade separated intersection.

2. Construct a number of highrise office up to plot ratio 8.0.

3. Transfer of certain floor area of completed office space to laboratory with fully

furnish equipment.

4. Construct a bus terminal.

5. Construct an amphitheatre.

6. Transfer of certain floor area of completed office space to City Hall of Kajang.

7. Upgrade existing road infrastructure surrounding the development, improve

infrastructure network, including a grade separated intersection.

8. Construct and maintain a public garden

9. Construct a Mosque

Research Partners

1. Collaborate together creating a Research Park base in Kajang and thus

connecting several academic institution and researches agency nearby.

2. Cover several scope of study and provide business joint.

3. Provide consultation in respected area.

Research Partners

Universiti Kebangsaan

Malaysia Universiti

Tenaga Nasional

UniKL

German Malaysian Institute

KPTM Bangi

New Era College

Malaysian Nuclear Agency

GENOM Malaysian Institute (MOSTI)

UPM's Hospitals

Potential stakeholder/investor

1. Referring to the private sector that interested in using research for their own

profit or company.

2. This group of people will invest in this project.

3. Once the project completed, these investor will gain their profit by

rehabilitating new method with latest technology.

4.0 PROJECT COMPONENT

Scope of work

The work to be accomplished starting from initiating project idea, finding investor,

and construction of Park building which focused on quantity and quality of work.

Budget

Costs need and used measured in Malaysian Ringgit (RM) and invested money by

private nor public sectors.

Scheduling

The logical sequencing and timing of the project to be performed through several

process which is :

1. Initiating

2. Planning

3. Executing

4. Managing

5. Closing

5.0 BENEFITS OF PRIVATIZATION

Accomplishments of Privatization

1. Privatization helps to reduce the burden on Government.

2. It will help profit making public sector unit to modernize and diversify their

business.

3. It will help in making public sector unit more competitive.

4. It will help to improving the quality of decision making, because the decisions

are free from any political interference.

5. It encourage new innovations without any restrictions.

6. It promotes industrial growth.

7. Increase the foreign investment.

8. Increase in efficiency

9. The best way to rebuild weakened Public sectors.

10. Stops making public sector loss from adding to government debt.

11. Raises more money for government through taxing.

12. Creates more jobs and generating wealth for the country.

Graph shows the increasing number of telecom privatisation in Qatar over years.

Graph shows impact of competition creating from privatization showing high

revenue over the years in Qatar’s Telecom company, Telstra.

6.0 PROBLEMS FROM PRIVATISATION

Problems in Privatization

1. Ownership to a privileged few

2. The payer could suffer while public assets get sold off.

3. Ownership would be transferred from public hands to the private firms

4. Restructuring need money.

5. Timing and menu of options.

6. Social safety net as before worker need to paid severance and compensation.

7. Severance, retraining of public works.

8. Managing the process takes challenge, time and effort.

9. Consultation and participation from stakeholder and partner interested to ensure

success.

10. Laborers would be at the mercy of the private owners, not government

anymore.

11. Loss of experienced managerial expertise

Timing and Sequencing of Labor Restructuring

1. Complicates negotiations

2. Pragmatic

3. Joint decisions

4. Mixed approach

5. Delays

6. Wrong results

7. Dispute settlement

8. Safety net

9. Restructure first

10. Political/social considerations

11. Lower value

12. Market based

13. Speed

14. Leave to private sector

7.0 CONCLUSION

Alternatives to total privatization

1. Public Utility: The enterprise can remain as a public utility

2. Non-Profit: The enterprise could be managed by a private non-profit

organization.

3. Bankruptcy: State can wait until the enterprise becomes bankrupt.