Malaysia and Singapore announced on Tuesday an agreement on a special economic zone in the southern Malaysian state of Johor, aiming to support investment and free up movement of goods and people between the countries.

Malaysia and Singapore leaders signed an agreement on Tuesday to create a special economic zone to attract global investment and ease the cross-border flow of goods and people. Malaysian Prime Minister Anwar Ibrahim called the Johor-Singapore special economic zone a “unique initiative” that harnesses each other's strengths and deepens linkages in a world that is becoming more polarized.

Malaysia unveiled a slew of tax incentives to lure investors to its joint special economic zone with Singapore that seeks to add $26 billion per year to the Malaysian economy by 2030.

While Singapore has one of the lowest corporate income tax rates in the region at 17%, companies in Malaysia pay between 15% and 24%. "Malaysia and Singapore agree to special economic zone in Johor" was originally created and published by Investment Monitor, a GlobalData owned brand.

Malaysia will offer tax incentives for companies and workers in its special economic zone with Singapore in the southern state of Johor, its finance ministry said on Wednesday.

The Johor-Singapore Special Economic Zone is nearly twice the size of Shenzhen, whose success it is hoping to emulate.