Jun 21, 2018
Chinese Firms Display Strong Confidence In New Malaysian Government And Are Bullishly Pumping In Billions Of Ringgit
Despite the change in Malaysian government, Chinese companies are continuing to invest in Malaysia, reported The Edge and Malaysiakini.
In fact, China’s e-commerce giant Alibaba still proceeded with the opening of a new office in Kuala Lumpur on Monday (18 June) following Malaysia’s 14th General Election in May, said Beijing’s Ambassador to the country Bai Tian.
Chinese companies also pumped in billions of ringgit in investments even through the Pakatan Harapan party defeated the former administration, he noted
For example, three China-based medical firms invested RM1.2 billion during the first week since the forming of the new government, while Shandong-based D&Y Group has opened Phase II of its factory in Johor.
“China Construction Bank in Malaysia has also decided to purchase RM200 million worth of bonds from the local bond market,” noted Bai.
He also downplayed concerns over the ECRL project, saying that Beijing is looking at the bigger picture in terms of China’s ties with Malaysia, instead of focusing on a specific issue.
Currently, the new Malaysian government is scrutinizing mega projects backed by China like the 688 km East Coast Rail Link (ECRL). This is due to the project’s peculiar terms and high price tag of more than RM 66 billion, with the Export-Import Bank of China loaning 85 percent of the amount at an interest rate of 3.25 percent, while Malaysia will shoulder the rest.
Prime Minister Tun Dr Mahathir Mohamad said it is “strange” that the payment to ECRL’s contractor, China Communications Construction Company, is based on a predetermined schedule, instead of actual completion rate.
Moreover, the hefty cost translates to RM80 million per km of rail tracks compared to other local railway projects costing RM50 million per km on average.
Article source from propertyguru.com