Why JB-SG RTS Could Rebalance Everything: Tackling the Long-Term Outflow of Singaporeans’ Spending Money to JB
An article by
Dave Koh
A Singaporean audiophile, real estate agent, bicycle tourer
Youtube: https://www.youtube.com/@DaveKohProperty
Contact: +65 87865200
(English is corrected and refined by ChatGpt)
With the upcoming Rapid Transit System (RTS) linking Singapore and Johor Bahru (JB) inching closer to reality, much of the conversation has focused on surface-level benefits and short-term fears. Malaysian businesses are already celebrating, while Singaporean small retailers and service providers are bracing for impact.
The prevailing belief? That the RTS will unleash a tidal wave of Singaporeans crossing the Causeway daily to spend their strong dollars in JB, leaving local businesses in Singapore struggling even more.
But what if this assumption is incomplete—or even wrong in the long term?
As someone who has been observing both sides of the border for decades, I’d like to offer a speculative counter-view: that the RTS may, intentionally or unintentionally, help balance the very economic dynamics many are worried about—through a long-term price convergence triggered by human nature and the invisible hand of the market.
The Dominant View: RTS Will Drain Singapore Dollars into JB
It’s easy to see why so many believe the RTS will widen the consumer outflow. Singaporeans have long been traveling to JB for cheaper meals, groceries, car repairs, dental work, massages—you name it. At the time of writing, the exchange rate is $1 SGD to 3.30 MYR. That’s a powerful incentive.
In Singapore, prices have continued to rise across all sectors. In JB, even with inflation, services and goods often remain significantly cheaper—at least for now. The RTS promises to make this movement seamless, allowing thousands more to cross daily without traffic jams or delays.
Local business owners in Singapore are understandably concerned. As the global economy faces headwinds—trade tariffs, inflation, and war—many Singaporean SMEs and heartland retailers are already fighting to survive. The thought of losing more consumer dollars is not just worrying—it’s existential.
What Most Experts Miss: The Human Factor
Most expert commentaries on RTS are dominated by technical analysis—things like train capacity, commuting times, land value effects, and bilateral agreements.
But what these analyses miss entirely are the human factors at play:
👉 Greed. 👉 Pride. 👉 Ambition.
Spending—whether on leisure, comfort, or even essentials—is deeply emotional.
And when something like the RTS is introduced, it doesn’t just move people—it amplifies the psychology behind their spending behavior.
You cannot evaluate the RTS effect without factoring in how businesses behave under opportunity, or how consumers respond to perceived value. These are not spreadsheets—they’re real human decisions.
My Personal Experience: 20 Years Ago in Muar
This dynamic isn’t new to me. About 20 years ago, I regularly visited a nostalgic coffee shop in Muar, Malaysia. The place was known for its traditional kaya toast and coffee—simple, satisfying, and priced like a piece of the past.
One morning, after multiple visits, the shop owner casually remarked, “As Singaporeans, you’re getting three times the value here.” He wasn’t wrong. But what surprised us was what came next: he overcharged us, openly.
He didn’t try to hide it. To him, it was justified. The value we were receiving (due to currency strength) meant we could afford to pay more. This wasn’t about being dishonest—it was an unfiltered expression of market logic.
What’s Already Happening: Prices in JB Are Surging
Fast forward to today, and we’re seeing this play out on a larger scale.
Prices in JB—especially in consumer services—have surged beyond inflation. Not just because of higher raw material or labor costs, but because businesses are pricing in the Singaporean premium.
There are countless social media clips and online comments from Johor residents complaining about unaffordable prices. Many locals now feel like outsiders in their own economy—outpriced by the rising tide of foreign (Singaporean) spending.
And this is before the RTS even begins operations.
The RTS May Trigger a Price Convergence—Not a One-Way Leak
Here’s the core of my view:
If the RTS increases cross-border traffic and spending, it will likely push prices in JB even higher, especially in sectors that rely on Singaporean customers.
Why? Because from the business owner’s perspective, even a 30–50% increase in price is still a bargain for a Singaporean. There is no incentive to keep prices low when you can sell less, charge more, and still win.
Over time, this will naturally close the affordability gap between JB and Singapore. And once the price advantage narrows, the incentive to go to JB weakens—especially when you factor in time, effort, and convenience.
So, while most people see the RTS as a short-term consumer “leak,” I see it as potentially contributing to a long-term rebalancing. This may not happen immediately. But as prices rise in JB and stabilize in Singapore, spending patterns could shift back again.
A Silent Strategy? Or Just the Market at Work?
Let me be clear: I am not claiming that this is a grand strategy orchestrated by the Singapore government. But whether intentionally or unintentionally, the RTS could serve as a tool in a larger, natural balancing act.
It’s almost impossible for the government to ask Singaporeans to stop spending in JB. That would be politically unpopular and economically tone-deaf.
But if market forces, triggered by infrastructure and behavior, naturally make JB less cost-attractive, it reduces the outflow of spending without having to say a word.
Could this be a way to help struggling Singapore businesses retain more local customers, simply by making Malaysia less irresistibly cheap? It’s speculative, yes. But it’s not unreasonable.
Final Thoughts: Don’t Underestimate Character and Instinct
At the heart of it all, economics is not just numbers. It’s human behavior. It’s business owners reacting to opportunity. It’s consumers pursuing value. It’s ambition and pride and instinct woven into everyday decisions.
And that’s why I believe the RTS will not just reshape logistics, but slowly reshape pricing, spending, and maybe even policy.
If you’re betting on JB remaining a cheap haven forever, don’t bet too hard.
What This Means for You
🔹 Singaporean consumers: Enjoy the ride while it lasts—but keep an eye on JB’s creeping prices. The gap is closing.
🔹 JB business owners: Know that growth comes with consequences; pricing too high may backfire when the novelty wears off.
🔹 Singapore policymakers: Maybe you’re already seeing this. If not, it’s time to watch how the emotional economy shapes our national one.
This is my speculative view. I could be wrong—but I hope I’m at least asking the right questions.
A Reverse Foreword:
The organic market ecosystem must be affected by the “natural” free market dynamic.
If you cannot directly alter the market itself, create something in the second or third tier—an indirect force or mechanism—that will most likely give you the desired result.
Not by force. Not by decree. But by nudging the ecosystem to evolve on its own.
That, to me, is the smartest kind of balancing act.