Melaka Sustainability Outlook Diagnostic : Supporting Report 6 - Demonstrating Fiscal Sustainability

Capital investment is essential for achieving sustainable cities. Melaka State's long-term sustainability can be improved through well-planned investments in various projects, such as the development of ports and rail connections, a robust public transportation network, and adequate flood prevention. All of these projects will require capital. Although financing provided by Malaysia's federal government is important, Melaka State's ability to shape its own investment priorities and accelerate the fiscal improvement process can be greatly enhanced by accessing market-based financing whether through long-term debt financing, public-private partnerships (PPPs), land value capture mechanisms, or a combination of these. Fiscal sustainability is the key to accessing adequate capital resources for Melaka State's investment projects indicated in the state structure plan. This supporting report reviews the fiscal sustainability of both Melaka State and one of its municipalities, Melaka City. The report concludes by offering several key recommendations that Melaka State and Melaka City could take in order to improve their fiscal sustainability