Economic Impacts of High-Speed Rail between Kuala Lumpur and Singapore: An Application of IDE-GSM

Discussion Papers

No.700

by Satoru Kumagai, Ikumo Isono and Kazunobu Hayakawa

March 2018

ABSTRACT

This paper examines the potential economic impacts of the Kuala Lumpur (KL) – Singapore High-speed railway (HSR) using a CGE model based on spatial economics, called IDE-GSM. The simulations covered three different scenarios: (1) Singapore–KL non-stop express service, (2) Johor–KL local service, and (3) Singapore–Johor shuttle service. Simulations were also performed to compare the economic impacts of the project on Singapore and the thirteen states of Malaysia. O ur simulation analysis revealed that the economic impacts of HSR for Malaysia and Singapore in the best policy mix are USD 1.589 billion and USD 641 million a year for 2030, respectively.

Keywords:  Simulation, new economic geography, Singapore, Malaysia

JEL classification:  R12, R13, R42

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