SG4 states can become economic powerhouse by pooling resources, says Dr Mahathir
KUALA LUMPUR: Former prime minister Tun Dr Mahathir Mohamad has described the four SG4 states as a “sleeping giant” capable of becoming a major economic powerhouse if they pool their resources, strengthen their industries and unlock their untapped potential.
He said Terengganu, Kelantan, Kedah and Perlis, with a combined population of 5.7 million, possessed the resources, workforce and infrastructure needed to emerge as a productive economic region.
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“From the very beginning, I felt that SG4, as a collective entity comprising the four northernmost states, with a population of 5.7 million spread across a land mass of more than 38,000 sq km, is indeed a sleeping giant.
“If these states can get their act together, pool their resources and complement each other, ‘the sky is the limit’ no longer sounds too clichéd,” he said.
His speech was read by his son, Tan Sri Mokhzani Mahathir, at the SG4 Business and Economic Forum 2026 at the Kuala Lumpur Convention Centre today, as the former prime minister was unable to attend due to health reasons.
Mahathir said the four states had begun exploring economic opportunities beyond their traditional industries, with Kedah positioning itself as a manufacturing hub while Kelantan sought to commercialise its agricultural sector.
Terengganu, he said, was exploring downstream petroleum activities to reduce its dependence on oil royalties, while Perlis was looking to expand cross-border trade.
He also pointed to the growth of cafes and homestays in Perlis as evidence of changing entrepreneurial attitudes. However, he cautioned that SG4 should help local businesses avoid market saturation and explore more sustainable business models.
Mahathir highlighted the region’s substantial rare earth element deposits, stressing that SG4 should prioritise downstream processing and value-added industries rather than simply extracting and exporting raw materials.
“The issue now is not merely about extracting and selling them, which would immediately provide the SG4 states with a substantial source of income for their state coffers.
“Rather, it is about how to add value to these elements, which would increase their income manyfold,” he said.
However, Mahathir cautioned that natural resources alone would not guarantee prosperity, stressing that the region’s greatest asset remained its people.
He said SG4 must address attitudes that favoured shortcuts and quick profits, as well as corruption, while encouraging entrepreneurship, integrity and sustainable business practices.
Mahathir acknowledged that the four states had lagged behind their west coast counterparts for decades but said stronger commitment from leaders and communities could help narrow the economic gap.
Recalling the “Malaysia Boleh” spirit that accompanied the country’s economic rise in the 1990s, he urged the four states to embrace a similar sense of determination.
“In the 1990s, when Malaysia gained recognition and was dubbed an Asian tiger, the mantra was ‘Malaysia Boleh’, or ‘Malaysia Can’, which basically summed up the energy and commitment needed to achieve such confidence and success.
“It is time for the SG4 states to dig deep into their reserves and declare that SG4 can do it too,” he said.