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Wednesday, June 10, 2009

Bitter pill to swallow for Penang developers

The Penang government's move to take a firm stand in deciding once and for all the fate of four property developers who were said to be affecting George Town's status on the World Heritage List is commendable.

By deciding that all development projects within the heritage core and buffer zones must stick to an 18m or five-storey height ruling ahead of a United Nations Educational, Scientific and Cultural Organisation (Unesco) meeting in Spain next week (where the George Town issue is to be discussed), shows that we have not ceded our "sovereignty" to the UN body in deciding how development in our country and cities should proceed.

For the four affected developers - Asian Global Business (AGB) Sdn Bhd, Boustead Holdings Sdn Bhd, Eastern & Oriental Sdn Bhd and the Low Yat Group - the final decision that they must adhere to is one which may be a bitter pill to swallow.

Four firms had approvals from the Penang Island Municipal Council for projects exceeding the 18m limit well ahead of the date when George Town got its place on the World Heritage List in July 2008.
AGB's project is the Pier Hub @ Weld Quay, while Boustead is developing the Boustead Royale Bintang Hotel behind the general post office in Lebuh Downing. Eastern & Oriental is building an extension to the E&O Hotel while Low Yat plans to build a 23-storey hotel on Jalan Sultan Ahmad Shah, both in the buffer zone.

It has not been an easy ride for these companies since last November, when a bombshell was dropped that their "offensive" projects were now going to be a likely reason for George Town to be de-listed from the prestigious heritage map.

Besides having to contend with nervous and irate bankers, along with an army of demanding shareholders, these companies also had to deal with many trying situations on the ground in Penang, including heritage and conservation activists who have been very vocal in protecting the heritage city's listing status.

Today's state government "inherited" the problems which came in approvals granted to the three companies by the former administration. The mind boggles at how the three companies could be allowed to circumvent the five-storey height restriction which that same government had crafted as part of its heritage guidelines when applying for listing status.

The previous administration must assume some measure of responsibility for the situation the three companies have found themselves in. The current state leadership is not entirely blame-free either, since they were instrumental in granting the green light to the Low Yat group to proceed with its high-rise project by simply following a precedent set for the three companies .

There should no longer be empty promises made to investors by saying that "everything can be settled" and then leave these companies to sort things out.

Local authorities like the municipal council must be empowered to make decisions with no political interference, if Penang is serious in wanting to continue rejuvenating itself as an investment destination of choice.

It is not known if there are major financial casualties yet on the four firms caused from the uncertainly of the past months and the fact that some will now have to scale down their projects, re-position their products or in the case of one, abort their plans altogether.

Looking ahead, there is now an urgent need for a clear-cut blueprint on how the four development projects and subsequent ones in the heritage city are to be carried out.

Transparency by all parties is also key if the state is serious in wanting to keep George Town's place on the heritage list. It is apparent that the state government has decided to take into consideration an extensive mission report which has been compiled by two Unesco experts who visited Penang recently.

Among them is a suggestion that Malaysia introduce new legal provisions for the protection and management of its World Heritage sites.

Apart from stating in no uncertain terms that the AGB and Boustead projects must be scaled down in height, the report also recommends that efforts be made to reduce the impact of the E&O and Low Yat projects which lie in the buffer zone.

The question now is: Since the state has more or less "resolved" the outstanding concerns of Unesco about George Town's heritage enclave, is there a necessity to be spending public funds and have two Penang Island Municipal Council officials flying to Seville in Spain this month to attend the Unesco Heritage Committee meeting?

Probably not.

By Business Times

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