While Malaysia's parliament is in capital Kuala Lumpur, the federal government runs its administration from a suburb, Putrajaya.

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Mahathir will lead the way by making his department a paperless office when it moves to Putrajaya in 1998.

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Surrounding the Federal Territories of Kuala Lumpur and Putrajaya, Selangor's strategic location boosts its appeal as the preferred holiday destination for the rising middle class Malaysians and foreign tourists.

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Much of the rest will be because of herculean government spending, such as the multi-billion-dollar administrative complex in Putrajaya that the government will move into this month.

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Critics say this leads to spending on prestige projects popular with politicians, like the towers, which were slow to fill up, and Putrajaya, Malaysia's flashy new capital.

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It will take in two other mega-projects: the planned administrative center of Putrajaya and a separate "intelligent city" nearby that will provide commercial and residential facilities for the MSC's high-tech work force.

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