CHINESE CORRIDORS inMALAYSIA - Knight Frank
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CHINESE CORRIDORS
in
MALAYSIA
CHINESE CORRIDORS CHINESE CORRIDORS
2 IN MALAYSIA 2 IN MALAYSIA
KEY TAKEAWAYS
KEY TAKEAWAYS
• China's Belt and Road Initiative
• China's
(BRI),
Belt
launched
and Road in 2013,
Initiative
aims
(BRI),
to revive
launched
the in 2013, aims to revive the
great Silk Road linking itgreat
with Silk
Europe
Roadthrough
linking billions
it with ofEurope
dollarsthrough
of billions of dollars of
infrastructure investment across
infrastructure
six economic
investment
corridors.
across six economic corridors.
• Over the coming decades, • Over
the the
development
coming decades,
of the built
the environment,
development of the built environment,
whether infrastructure or logistics
whetherrelated
infrastructure
and in theorform
logistics
of new
related
townships
and in the form of new townships
or urban settlements along the
or urban
Belt Road
settlements
link, willalong
be considerable.
the Belt Road link, will be considerable.
• Malaysia, strategically positioned
• Malaysia,along
strategically
the Belt Road
positioned
link, along
offers the
many Belt Road link, offers many
advantages in terms of abundant
advantages
resources,
in termsgood
of abundant
growth potentials
resources, andgood growth potentials and
similarities in culture due to
similarities
historicalinties.
culture
The due
country
to historical
can be China’s
ties. The country can be China’s
gateway to Asean and beyond. gateway
In fact,
toMalaysia
Asean and hasbeyond.
seen anInupsurge
fact, Malaysia
of BRI has seen an upsurge of BRI
related investments with China
relatedemerging
investmentsas one
with ofChina
its largest
emerging
foreign
as one of its largest foreign
investors in recent years. investors in recent years.
• In November 2016, the Prime• In November
Minister led
2016,
an entourage
the Prime ofMinister
government
led an entourage of government
ministers and business leaders
ministers
in a visitation
and business
to China
leaders
and inrecorded
a visitation
newto China and recorded new
level of of bilateral relations
level with
of of14bilateral
business relations
to business
with 14(B2B)business to business (B2B)
Memorandums of Understanding Memorandums
(MOUs) and of Understanding
agreements worth (MOUs)RM144
and agreements worth RM144
billion (US$33.8 billion) in various
billion (US$33.8
areas such billion)
as trade
in various
and investment,
areas such as trade and investment,
development of technology development
parks as well of astechnology
supply of goodsparks and
as well
services.
as supply of goods and services.
• Further to that, another 16 • Further
government
to that,
to another
government16 government
(G2G) MOUs to and
government (G2G) MOUs and
agreements were also signed agreements
and they were
include
alsothesigned
RM55and billion
they(US$13
include the RM55 billion (US$13
billion) in soft loans by Chinabillion)
for theinEast
softCoast
loans Rail
by China
Link (ECRL)
for the and
Eastalso
CoasttheRail Link (ECRL) and also the
Malaysia-China Kuantan Industrial
Malaysia-China
Park (MCKIP)
Kuantan
in Pahang.
Industrial Park (MCKIP) in Pahang.
• During the Belt and Road•Forum
Duringheld
the in
Belt
Beijing
and Road
in MayForum
2017,heldanother
in Beijing
nine in May 2017, another nine
B2B MOUs with total value of
B2Bcirca
MOUsRM31 with
billion
total(US$7.2
value of billion)
circa RM31
were inked.
billion (US$7.2 billion) were inked.
• The close ties between the• two
The countries
close ties have
between
also the
led two
to the
countries
appointment
have also led to the appointment
of Jack Ma, founder of China’s
of Jacke-commerce
Ma, founder giant
of China’s
– Alibaba e-commerce
Group, as giant – Alibaba Group, as
Malaysia’s digital economyMalaysia’s
adviser indigital
late 2016
economy and adviser
the subsequent
in late 2016 and the subsequent
formation of the KLIA Aeropolis
formation
Digital
of the
FreeKLIA
TradeAeropolis
Zone (DFTZ)
DigitalPark
FreeinTrade Zone (DFTZ) Park in
Sepang, Selangor. The latter,
Sepang,
Alibaba’s
Selangor.
first regional
The latter,
hub outside
Alibaba’s
China,
first regional
will hub outside China, will
be a boost to Malaysia’s e-commerce
be a boostroadmap.
to Malaysia’s e-commerce roadmap.
• China's Zhejiang Geely Holding
• China's
Group's
Zhejiang
entry
Geely
as aHolding
strategic
Group's
partnerentry
of as a strategic partner of
Proton Holdings Bhd (49.9% Proton
stake),
Holdings
may revive
Bhd (49.9%
the ailing
stake),
national
may car
revive the ailing national car
company. Geely which alsocompany.
owns Sweden's
Geely which
Volvo also
Car Group,
owns Sweden's
expects toVolvo Car Group, expects to
make inroad into the expanding
makeSouth-East
inroad intoAsia
the expanding
automobileSouth-East
market via the
Asia automobile market via the
partnership. partnership.
• Moving forward, China investment
• Moving
willforward,
continueChina
to transform
investment
Malaysia,
will continue
particularly
to transform Malaysia, particularly
in the manufacturing, construction,
in the manufacturing,
infrastructure, property
construction,
and e-commerce
infrastructure, property and e-commerce
sectors. sectors.
• Melaka is building the RM12.5
• Melakabillion
is Kuala
building
Linggi
the RM12.5
International
billionPort
Kuala
(KLIP),
Linggi International Port (KLIP),
financed by belt-road funds financed
from China. by belt-road
Chinese investors
funds from andChina.
contractors
Chinese investors and contractors
are also involved in the building
are also ofinvolved
the RM8.9
in the billion
buildingGemas-Johor
of the RM8.9 billion Gemas-Johor
double-tracking railway anddouble-tracking
the RM55 billionrailway
East Coast
and theRail
RM55Link billion
(ECRL). East Coast Rail Link (ECRL).
The ECRL acts as a land bridge
The ECRL
between actsPort
as aKlang
land and
bridge
Kuantan
between PortPort
andKlang and Kuantan Port and
other ports along the East Coast
other ofports
the along
peninsula.
the East
TheCoast
improvement
of the peninsula.
of the The improvement of the
local infrastructure with thelocal
involvement
infrastructure
of thewith
Chinese
the involvement
will strengthen
of the Chinese will strengthen
economic, cultural and diplomatic
economic, relations
cultural
between
and diplomatic
both nations.
relations between both nations.
• In the southern state of Johor,
• In the southern
on-going stateUS$100 of Johor,
billionthe
‘eco on-going
city’ project
US$100 billion ‘eco city’ project
known as Forest City, is billed
known as theas next
Forest‘Shenzhen’.
City, is billed Launched
as the nextin 2014,
‘Shenzhen’. Launched in 2014,
the mega project consiststheof mega four reclaimed
project consists
islands of spanning
four reclaimed
2,025 islands spanning 2,025
hectares and is being developed
hectaresby Country
and is being
Garden developed
Pacific View by Country
(CGPV),Gardena Pacific View (CGPV), a Allan Sim Allan Sim
joint venture between Guangdong-based,
joint venture between Hong Guangdong-based,
Kong listed CountryHong Kong listed Country Executive Director of CapitalExecutive
Markets Director of Cap
Garden and local partner, Garden
Esplanade andDanga
local partner,
88 over Esplanade
a 20-year Danga period. 88 over a 20-year period. Knight Frank Malaysia Knight Frank Malaysia
Despite facing scrutiny due toDespite
its behemoth
facing scrutiny
size anddue China’s
to its capital
behemoth outflow
size and China’s capital outflow
The rise in China’s presenceThe across
rise the Asia Pacific
in China’s region
presence across the Asia P
policy, the project continuespolicy,
to progress
the project
albeitcontinues
at a slower to pace
progressbackedalbeit
byat a slower pace backed by
is significant. Malaysia’s strategic positioning
is significant. along the
Malaysia’s Belt positioning a
strategic
its developer’s strong financial
its developer’s
and constructionstrong foundations.
financial and Itconstruction
has just foundations. It has just
and Road link promises revolutionary
and Road link transformations in
promises revolutionary transf
entered its second phase. entered
The international
its second project
phase. with
Thea international
newly opened project with a newly opened
terms of the country’s realterms estateoflandscape as well
the country’s real asestate landscape
sales gallery in Kuala Lumpur,salestargets
gallery global
in Kualainvestors
Lumpur, and targets
homebuyers
global investors and homebuyers
significant infrastructure projects
significanti.e.infrastructure
ports, bridges, projects i.e. por
from countries / territories like
fromthe countries
Middle /East,territories
India, likeVietnam,
the Middle
Thailand,
East, India, Vietnam, Thailand,
railways, etc., with extensiverailways,
participation
etc., by
withChinese firms.
extensive participation by C
Japan, and Taiwan. Japan, and Taiwan.
China also plays a pivotal Chinarole inalso
developing
plays a Malaysia’s
pivotal role in developin
• China’s capital control may• have
China’s slowed
capitaldown
control
the mayinflow haveof Chinese
slowed private
down the inflow of Chinese digitalprivate
economy, giving rise to rapid
digital economy,development
giving riseof to rapid dev
capital for investment purposes,
capitaland for Malaysia
investment is no purposes,
exception. andInMalaysia
the localis no exception.Malaysia’s
In the locallogistics and industrial
Malaysia’s sector. The and
logistics teamindustrial
at sector. T
property scene, we now property
see a trend scene,wherewe there
now see are more
a trend Chinese
where there are more KnightChinese
Frank Malaysia is ready
Knight andFrank wellMalaysia
positioned to
is ready and well p
developers making inroads intodevelopers
the market makingvia joint
inroads ventures
into thewhere
marketthereviaisjoint ventures where
capturethere
thisishuge wave of opportunities drivenwave
capture this huge by theof BRI.
opportunities driven
less strain on capital flow compared
less straintoon outright
capitalland
flowpurchase.
compared to outright land purchase.
CHINESE CORRIDORS CHINESE CORRIDORS
IN MALAYSIA 3 IN MALAYSIA 3
Sarkunan Subramaniam
Sarkunan Subramaniam
Managing Director Managing Director
Knight Frank Malaysia Knight Frank Malaysia
China’s BRI is the catalyst that
China’s
will turn
BRI the
is the
balance
catalystof that
power willtowards
turn the balance of power towards
the east. Its BRI policy comesthe at
east.a time
Its BRI
thatpolicy
manycomesof its neighbours
at a time that many of its neighbours
need China’s capital to boostneed
theirChina’s
economy. capital
Whilstto boost
the capital
their controls
economy. Whilst the capital controls
will slow China’s private capital
will slowinvestments
China’s private
in the capital
BRI, the investments
State in the BRI, the State
owned companies continue owned
their companies
plan to invest continue
in Port their
andplan
Railto invest in Port and Rail
HINA CHINA
infrastructure to ensure ‘all infrastructure
roads now lead to ensure
to China’.‘all roads
Trade now
as we lead to China’. Trade as we
know it will change in less than
know10 it will
years change
from nowin less
as than
a result
10 years
of the from now as a result of the
BRI with China’s dominance. BRIMalaysia’s
with China’s strategic
dominance.
locationMalaysia’s
in the BRIstrategic location in the BRI
route can propel it to a keyroute
regional
can ally
propel
to China’s
it to a keyBRI regional
plan reaping
ally to China’s BRI plan reaping
economic benefits for itself in
economic
the process.benefits for itself in the process.
There is no question that Foreign
There isDirect Investment
no question that(FDI) inflows
Foreign intoInvestment (FDI) inflows into
Direct
Malaysia have been seeing Malaysia
a recoveryhave
of late.
beenAccording
seeing a to data from
recovery of late. According to data from
the Department of Statistics the Malaysia
Department (DOSM), FDI surged
of Statistics from(DOSM), FDI surged from
Malaysia
RM35,600 million in 2014RM35,600
to RM43,435 million
million in 2015.
in 2014 Despite million in 2015. Despite
to RM43,435
significant decline in global FDI anddecline
significant FDI inflows to developing
in global FDI and FDI inflows to developing
INTRODUCTION
INTRODUCTION
economies of 13% and 20%economies
respectively
of in 2016,
13% andMalaysia continuedin 2016, Malaysia continued
20% respectively
to remain attractive amongsttoinvestors, recording
remain attractive RM41,176
amongst million recording
investors, in RM41,176 million in
FDI inflows, only circa 5% lower than 2015.
FDI inflows, only circa 5% lower than 2015.
FDI INFLOWS TO DEVELOPING ECONOMIES
FDI INFLOWS TO DEVELOPING ECONOMIES
RM Million RM Million
50,000 50,000
40,000 40,000
43,435
43,435
41,176
41,176
38,175
38,175
30,000 30,000
35,600
35,600
28,537
28,537
MALAYSIA MALAYSIA
20,000 20,000
10,000 10,000
0 0
2012 2013 2014 20122015 20132016 2014 2015 2016
Source: Department of Statistics Malaysia
Source:(DOSM)
Department of Statistics Malaysia (DOSM)
In 2016, the services sectorIn recorded
2016, thehigher FDI sector
services inflowsrecorded
to RM20.9 higher FDI inflows to RM20.9
billion (2015: RM12.6 billion) while(2015:
billion for theRM12.6
manufacturing sector,
billion) while for FDI
the manufacturing sector, FDI
inflows declined from RM17.1 billiondeclined
inflows in 2015from
to RM11.0
RM17.1 billion in in
billion 2016.
2015 to RM11.0 billion in 2016.
As for total approved investments, it increased
As for total approved circa 8% to register
investments, at
it increased circa 8% to register at
RM207.9 billion in 2016 (2015: RM193.0
RM207.9 billionbillion)
in 2016 with domestic
(2015: RM193.0 and billion) with domestic and
foreign investment ratio of 72% to 28%.
foreign The services
investment sectortoled
ratio of 72% 28%.withThe services sector led with
investment of RM141.2 billion (68%), followed
investment of RM141.2 by the manufacturing
billion (68%), followed by the manufacturing
sector with RM58.5 billion (28%).
sector with RM58.5 billion (28%).
In the manufacturing sector,InChina (RM4.7 billion)sector,
the manufacturing and theChina
Netherlands
(RM4.7 billion) and the Netherlands
(RM3.2 billion) were the main sources
(RM3.2 billion)of were
FDI inflows,
the mainfollowed
sourcesbyof FDI inflows, followed by
Germany, the UK and Republic of Korea
Germany, the(source:
UK and Malaysia
RepublicInvestment
of Korea (source: Malaysia Investment
Development Authority [MIDA]).
Development Authority [MIDA]).
CHINESE CORRIDORS CHINESE CORRIDORS
4 IN MALAYSIA 4 IN MALAYSIA
CHINA - THE-RISING
CHINA THE RISING
TIDE TIDE
China has been aggressively China
investing
has been
outside
aggressively
of its waters.
investing
In theoutside
fifth issue
of its
of waters.
an ErnstIn&theYoung
fifth (EY)
issue of an Ernst & Young (EY)
report “China Go Abroad”, 2016
reportwas“China
a record
Go Abroad”,
year for China’s
2016 was
outward
a recordFDI,year
recording
for China’s
a total
outward
of US$188.8
FDI, recording a total of US$188.8
billion. This accounts for a 30%
billion.
year-on-year
This accounts
growth.
for a Chinese
30% year-on-year
enterprisesgrowth.
in 2016Chinese
also announced
enterprises622 in 2016 also announced 622
overseas mergers and acquisitions
overseas (M&As),
mergers
totalling
and acquisitions
US$221.7 billion,
(M&As),a totalling
147% year-on-year
US$221.7 billion,
growth.a 147% year-on-year growth.
CHINA’S OUTWARD AND INWARD
CHINA’S
FDI DURING
OUTWARD
2010-2016,
AND INWARD
BY VALUE (US$ BN)2010-2016, BY VALUE (US$ 2016
FDI DURING BN) 2016
net capital net capital
outflow outflow
was was
2013 2015
2013 further 2015 further
Capital realizing
Capital enlarged realizing enlarged
200 200 outflow net capital
outflow net capital
exceeding outflow
exceeding outflow
US$100 for the
US$100 for the
billion for first time
billion for first time
150 150 the first the first
time time
100 100
50 50
Inward FDI Inward FDI
Outward FDI Outward FDI
0 0
2010 2011 2012
2010 2013
2011 2014
2012 2015
2013 2016
2014 2015 2016
Source: EY Report - China Go Abroad (5th Issue)EY Report - China Go Abroad (5th Issue)
Source:
China’s 13th Five Year Plan China’s
(2016 – 13th
2020)Five
setYear
a shift
Planin the
(2016
country
– 2020)
economic
set a shift
focus,
in the
from
country
heavyeconomic
industry focus, from heavy industry
and manufacturing towardsand more manufacturing
sustainable oriented
towardseconomic
more sustainable
forms through
oriented innovation,
economicservice
forms through
and innovation, service and
retail, infrastructure and overseas
retail, infrastructure
expansion. Thisandcreates
overseasboundless
expansion.
opportunities
This creates for boundless
both its domestic
opportunities for both its domestic
and foreign focused businesses.
and foreign focused businesses.
The devaluation of the Renminbi
The devaluation
(RMB) andofstockthe Renminbi
market turbulence
(RMB) andhad stock
alsomarket
contributed
turbulence
to market
had also contributed to market
uncertainty, which has led touncertainty,
investor wariness
which hasof further
led to policy
investorintervention.
wariness ofWith
further
this,policy
Chinese
intervention.
investorsWith this, Chinese investors
have realised a need for diversification,
have realisedin aparticular,
need for overseas.
diversification, in particular, overseas.
Malaysia is one of the key beneficiaries
Malaysia is one
of FDI
of the
fromkey
China
beneficiaries
as part ofofitsFDI
expansion
from China
in the
as region
part of through
its expansion in the region through
the Belt Road Initiative (BRI).the Belt Road Initiative (BRI).
Besides investing heavily in Besides
the country’s
investing
manufacturing
heavily in the
sector,
country’s
we aremanufacturing
also seeing significant
sector, we Chinese
are also seeing significant Chinese
investments in the infrastructure,
investments
logistics,
in construction,
the infrastructure,
and real
logistics,
estateconstruction,
segments. and real estate segments.
CHINESE CORRIDORS CHINESE CORRIDORS
IN MALAYSIA 5 IN MALAYSIA 5
WHY MALAYSIA?
WHY MALAYSIA?
ly positioned alongStrategically
the Belt Roadpositioned
link, Malaysia
alongcanthebeBelt
China’s
Road new
link, Malaysia
gateway can
to Asean
be China’s
and new gateway to Asean and
providing tremendousbeyond
opportunities
- providing
to access
tremendous
new markets
opportunities
and diversify
to access
local
newproducts
marketsand
and diversify local products and
Through strong historical
services.
tiesThrough
and good strong
bilateral
historical
relations
ties cementing
and good bilateral
close co-operations
relations cementing close co-operations
he two countries, Malaysia
betweencontinues
the two countries,
to benefitMalaysia
from economic
continues
growth
to benefit
and thefrom
upsurge
economic
of growth and the upsurge of
d investments. BRI related investments.
9, Malaysia has maintained
Since 2009, its pole
Malaysia
position
hasasmaintained
China’s largest
its pole
Asean
position
trading
as China’s
partner.largest
As of Asean trading partner. As of
Malaysia-China bilateral
1H2017,
tradeMalaysia-China
expanded 28%bilateral
to RM139.2
tradebillion
expanded
supported
28% to byRM139.2
a 41% surge
billion supported by a 41% surge
to RM59.8 billion – in
mainly
exportsin the
to RM59.8
electricalbillion
& electronic
– mainly(E&E)
in theproducts,
electricalpetroleum
& electronicproducts,
(E&E) products, petroleum products,
and chemical products,
chemicals
rubber andproducts
chemical and products,
liquefiedrubber
naturalproducts
gas (LNG) and
(source:
liquefied
Malaysia
natural gas (LNG) (source: Malaysia
ade Development CorpExternal
[Matrade]).
Trade Development Corp [Matrade]).
ember 2016 till MayFrom
2017,
November
a total of
2016 23 business
till May 2017,
to business
a total of
(B2B)23 business
Memorandums
to business
of (B2B) Memorandums of
ding (MOUs) totalling
Understanding
some RM175 (MOUs)
billion totalling
(US$20.2 some
billion)
RM175
were billion
inked (US$20.2
between thebillion)
twowere inked between the two
in various areas such
countries
as tradeinand
various
investment,
areas such
development
as trade and of technology
investment,parks
development
as well asof technology parks as well as
goods and services.supply
This of
is in
goods
addition
and to services.
anotherThis16 government
is in additiontotogovernment
another 16 (G2G)
government to government (G2G)
d agreements that include
MOUs theandRM55
agreements
billion (US$13
that include
billion)
theinRM55
soft loans
billion
by(US$13
China for
billion)
the East
in soft loans by China for the East
Link (ECRL) and also
Coast
the Rail
Malaysia-China
Link (ECRL) Kuantan
and also Industrial
the Malaysia-China
Park (MCKIP) Kuantan
in Pahang.
Industrial Park (MCKIP) in Pahang.
l estate segment, InMalaysia
the realcontinues
estate segment,
to attractMalaysia
Chinesecontinues
investors toseeking
attract aChinese
cheaperinvestors seeking a cheaper
to Australia, Hongalternative
Kong and to Singapore.
Australia, From
Hong2002
Kongtilland
JuneSingapore.
2017, some From9,283
2002Chinese
till June 2017, some 9,283 Chinese
27% of approved applications,
citizens (or 27%
the of
single
approved
biggest
applications,
nationality) the
havesingle
beenbiggest
grantednationality)
residency have been granted residency
Malaysia My Second under
Homethe(MM2H)
Malaysiaprogramme.
My SecondOther
Homeforeign
(MM2H) citizens
programme.
who have Other
benefited
foreign citizens who have benefited
olicy include 4,303from
Japanese,
this policy
3,656
include
Bangladeshis
4,303 Japanese,
and 2,465 3,656
British
Bangladeshis
/ Irish. and 2,465 British / Irish.
that many ChineseIt contractors
is noted thatare
many
alsoChinese
involvedcontractors
in major infrastructure
are also involved
and construction
in major infrastructure and construction
cross the country. projects across the country.
tourism industry, Malaysia’s
As for thevisatourism
exemption
industry, and
Malaysia’s
eVisa programme
visa exemption
for Chinese
and eVisatourists
programme
in for Chinese tourists in
ed to a surge in visitor
2016arrivals.
has ledChina
to a surge
is ranked
in visitor
third arrivals.
in termsChina
of tourist
is ranked
arrivalsthird
to Malaysia,
in terms of tourist arrivals to Malaysia,
apore and Indonesia. after
TheSingapore
number ofand arrivals
Indonesia.
from China
The number
surged of
from
arrivals
1.68 from
millionChina
in 2015surged
to from 1.68 million in 2015 to
n in 2016. For the 2.12
first eight
millionmonths
in 2016. of For
2017, theMalaysia
first eightwelcomed
months ofa 2017,
total ofMalaysia
1.52 million
welcomed a total of 1.52 million
als from China. visitor arrivals from China.
he above developments
All in are
all, the
positive
above fordevelopments
Malaysia as thearecountry
positivestands
for Malaysia
to reapasenormous
the country stands to reap enormous
om the successful roll-out
benefitsoffrom
China’s
the successful
‘project of the
roll-out
century’.
of China’s ‘project of the century’.
continued to investChina
heavily
hasincontinued
the country’s
to invest
manufacturing
heavily in the
sector
country’s
although
manufacturing
we are also sector although we are also
nificant Chinese investments
seeing significant
in otherChinese
market investments
segments, notably
in otherinfrastructure,
market segments,
logistics,
notably infrastructure, logistics,
on, and real estate.construction, and real estate.
CHINESE CORRIDORS
6 IN MALAYSIA
CHINESE FOOTPRINT ON
MALAYSIAN REAL ESTATE
In the built environment, Chinese participation comes in the form of investors, developers and
construction companies.
Besides the strong bilateral relations between the two countries, other pull factors that attract the Chinese
interest to Malaysia include tightening of China’s housing policies and its moderating economy, the BRI as
well as Malaysia’s strategic position within the Asia Pacific and Asean region and its proximity to
Singapore, supported by a stable government, good growth potential, investor friendly guidelines, and
lower entry cost for property development.
Four of the top 10 Chinese developers in 2017, by contracted sales value have made inroads onto the
Malaysia property market. They are Country Garden (ranked first with 581 billion yuan); China Vanke (No.
3); Greenland Group (No. 6) and China Overseas Land & Investment (No. 7). China Fortune Land
Development, ranked at eighth position and Greentown China, ranked tenth, have also indicated interest
in the Malaysia property development industry including the Bandar Malaysia.
The combined sales of the top 10 Chinese developers amounted to 3.19 trillion yuan.
Greentown
China
China Fortune
Land Dev 4 . 5% Country
% 1 8.
Garden
Longfor 4.6 2% Group
9%
Properties
China
4.
2017
Overseas
TOP 10
Land &
%
Investment
6.3
CHINESE
DEVELOPERS
8.6%
Greenland
Group
16.0%
BY CONTRACTED SALES
China
Evergrande
Total Sales of Top 10 Developers =
RMB 3.19 trillion
9.9
Poly Real
%
Estate
7%
11.3 1 5.China
%
Sunac Vanke
Sources:
China Guandian Index, SCMP
Other notable Chinese developers with presence in the country are Guangzhou R&F Properties,
Macrolink International Land (Malaysia) Sdn Bhd and Agile Property Holdings Ltd.
The majority of these Chinese companies have formed joint ventures with local builders to jointly
undertake property developments involving resorts, mixed-use components, retail space, and residential
products. However, the sheer size of selected projects has stoked overcapacity concerns amid a weak
property market environment.
The following lists notable real estate projects with Chinese Companies’ participation, some of which are
on-going whilst others are in the planning stage.
CHINESE CORRIDORS
IN MALAYSIA 7
NOTABLE REAL ESTATE PROJECTS WITH CHINESE COMPANIES’ PARTICIPATION
Projects / Approximate Gross Development
Year Parties Location
Type of Development Land Size (acres) Value (GDV) / Investment
WILAYAH PERSEKUTUAN KUALA LUMPUR
Four Seasons Place China Railway Construction Corp (contractor) Estimated GDV: RM3 billion
2013 KLCC 2.7
Mixed Development & Venus Assets Sdn Bhd (Slated for completion by end of 2017)
Agile Mont' Kiara Agile Real Estate Development (M) Sdn Bhd Estimated GDV: RM1.4 billion
2014 Mont’ Kiara 10
High-End Residential & PJ Development Holdings Berhad Investment: RM186 million
Pavillion Treasures Land Development Sdn Bhd
Redevelopment of Plaza Rakyat Estimated GDV: RM6-RM8 billion
2015 (subsidiary of Debao Property Development Ltd) Jalan Pudu 15.3
Serviced Apartment Investment: RM740 million
& Gabungan Tiasa Sdn Bhd (JV 82:18)
3rdNvenue CREC Development (M) Sdn Bhd Embassy Row, Estimated GDV: RM2.1 billion
2016 6.06
Mixed Development & Titijaya Land Berhad (JV 30:70) Jalan Ampang (4 phases in 7 years)
China Vanke Co Ltd
2017 Development Land Jalan Raja Chulan 7.4 Purchase of Land: RM500 million
& City Centre Sdn Bhd
SELANGOR
Country Garden Holdings Estimated GDV:
Country Garden Diamond City Phase 1: 100
2013 & Malaysia Land Properties Sdn Bhd Semenyih Plot A: RM710 million
Township Development Phase 2: 158
(Mayland Group) (JV 55:45) Plot B: RM1.7 billion
Serendah Project Country Garden & Malaysia Land Properties
2014 Serendah 167 Estimated GDV: RM535.92 million
Integrated Development Sdn Bhd (Mayland Group) (JV 55:45)
MCC Overseas (M) Sdn Bhd
Paragon @ KL Northgate
2015 & Harvest Court Construction Sdn Bhd Selayang 18 Estimated GDV: RM3.6 billion
Mixed Development
& KL Northgate Sdn Bhd (developer)
MELAKA
Melaka Gateway PowerChina International Group Ltd 1,366
2014 Melaka Estimated GDV: RM42 billion
Mixed Development – Harbour Project & KAJ DevelopmentSdn Bhd (JV 49:51) (Melaka Gateway)
JOHOR
Country Garden, Danga Bay 57.11
2012 Country Garden Holdings Danga Bay Estimated GDV: RM18 billion
Integrated Development (23 hectares)
Greenland Jade Palace, Danga Bay Estimated GDV: RM2.2 billion
2013 Greenland Group Danga Bay 13.96
Resort Hotels and Residential Developments Investment: RM600 million
Hao Yuan Investments Pte Ltd (Singapore-based
Danga Bay ~ 37
2013 mainly owned by mainland Chinese shareholders) Danga Bay Estimated GDV: RM8 billion
Integrated Development (15 hectares)
& Iskandar Waterfront Holdings (IWH) (JV 60:40)
Princess Cove @ Tanjung Puteri (6 sites) 116
2013 Guangzhou R&F Properties Tanjung Puteri Estimated GDV: RM24.5 billion
Integrated Development (46.94 hectares)
Estimated GDV
Zhuoyuan Iskandar Sdn Bhd (subsidiary of
Paradiso Medini (Phases 1 & 2) Phase 1: RM400 million
Zhouda Real Estate Group) & Medini Iskandar Phases 1 & 2: 16
Luxury Condominium Phase 2: TBC
Malaysia Sdn Bhd (JV 80:20)
2013 Medini Development Period: > 7 years
Phase 3 Zhuoyuan Group Phase 3: N/A Estimated GDV: RM1.5 billion
The M-Macrolink Medini Macrolink International Land
2014 Medini (Zone B) 11.7 Not available
Integrated Development (Malaysia) Sdn Bhd
Forest City Country Garden Group Near Tanjung Kupang 5,004 Estimated GDV: RM420 billion
2014
Integrated Development & Esplanade Danga 88 Sdn Bhd (JV 66:34) (4 reclaimed islands) (2,025 hectares) Development Period: > 20 years
Greenland Tebrau Bay Greenland Group
2015 Tebrau Bay, 128 Estimated GDV: RM20 billion
Integrated Development & Iskandar Waterfront City Berhad (JV 80:20)
2015 Seafront Land (Project Name: TBC) China Vanke Co. Ltd Johor Bahru ~148 (60 hectares) Investment: US$1.12 billion
Central Park @ Tampoi Country Garden Management Sdn Bhd
2016 Tebrau Corridor 53 Estimated GDV: RM4.6 billion
Integrated Township & Damansara Realty Bhd (JV 70:30)
PAHANG
Kuantan Waterfront Resort City CCCC Dredging Group Ltd Bina
2016 Kuantan 500 Estimated GDV: RM15 billion
Integrated Development & Puri Holdings Bhd
NEGERI SEMBILAN
Seremban 2 China Railway Liuyuan Group
2016 Seremban 77 Estimated GDV: RM650 million
Integrated Development & Paramount Blossom
SABAH
The Shore CREC Development (M) Sdn Bhd
2017 Kota Kinabalu 1.82 Estimated GDV: RM575 million (total)
Mixed Use Commercial Development & Titijaya Land Berhad (Joint project)
Source: Knight Frank Research / various sourcesCHINESE CORRIDORS
8 IN MALAYSIA
COUNTRY GARDEN:
WHAT'S NEXT?
Country Garden Group is one of the first Chinese
developers to debut in Malaysia with its maiden project,
Country Garden Danga Bay in 2012/2013. The 57-acre
integrated development with an estimated gross
development value (GDV) of RM18 billion won the Asia
Pacific Property Award 2014 - 2015 for Commercial
Landscape Architecture, Malaysia.
To date, the group has no less than five projects in
Malaysia with GDV totalling some RM445 billion.
Its mega project, the US$100 billion Forest City
development, launched in 2014, is administered by
Country Garden Pacificview Sdn Bhd (CGPV), a
joint-venture between Guangdong-based Country
Garden Holdings Co Ltd, China’s third largest
homebuilder, and Esplanade Danga 88 Sdn Bhd, a
Malaysian company. CGPV seeks to attract diverse
Image Source: multinationals, investors and property companies for
Country Garden Pacificview Sdn Bhd
the development of eight key industries in Forest City -
education, e-commerce, foreign investment, tourism, MICE (meetings, incentives, conferencing and exhibitions), entrepreneurship, financial services and
retirement destination. Last year, the international project reportedly sold 17,000 apartments to buyers from 23 countries, including Malaysia.
The recent capital outflow restriction imposed by the Chinese government, however, has inevitably affected sales of the project, which counts Chinese buyers
as its primary source of customers. To diversify its target market, the company is setting up show galleries in the Middle East, India, Vietnam, Thailand, Japan
and Taiwan to attract global investors and home buyers.
Country Garden Pacificview Sdn Bhd has also recently opened a new sales gallery for its Forest City developments at UBN Tower in Kuala Lumpur to
strengthen the developer's presence in the international market.
Despite facing scrutiny due to its behemoth size and China’s capital outflow policy, the project continues to progress albeit at a slower pace backed by its
developer’s strong financial and construction foundations. The project has just entered its second phase with proposed components that will include a Jack
Nicklaus designed 18-hole golf course and a 5-star hotel.
Country Garden’s latest project, a joint-venture with Damansara Realty Bhd, is the 53-acre Central Park@Tampoi development in the Tebrau corridor of Johor.
This low-mid to mid-price range project is targeted at the local Malaysian market.
In the short term, China’s curb on capital flight may have impacted foreign investment by its home-grown companies and nationals. With Beijing’s tightening of
regulations leading to slower inflow of Chinese private capital, we now see more developers from China making inroads into the local development scene via
joint-venture (JV) arrangements where there is less strain on capital flow rather than outright purchase of land. Vice versa, more small and mid-sized local
companies continue to look to China for capital support amid the challenging property market condition. Moving ahead, we expect to see continued interest
from Chinese developers partnering local developers in mixed use and township projects that target a wider pool of potential buyers, comprising more locals.
Malaysia remains on the radar of Chinese buyers whose choice of property locations includes Johor Bahru, Penang and Melaka. The country offers a good
proposition for Chinese investors supported by its MM2H programme, lower entry cost of property, similarities in food, culture, and language, and well
established education hubs that also include Xiamen University Malaysia Campus, China’s first overseas university. The BRI is an important investment driver
for Malaysia as it is being promoted by the Chinese government.
According to Juwai.com, China’s largest international property website, the average price of Malaysian residential real estate that Chinese buyers are most
interested in ranges between RM1.2 million and RM3 million with the majority of buyers looking for individual homes and apartments. Chinese demand for
Malaysian residential property reportedly increased 138 per cent in the first half of this year compared to one year earlier, and going forward, demand is expected
to continue growing.
CHINA’S CAPITAL CONTROL:
2016 2017 2017 • In the long run, we wish to
reiterate our view that the
Late August 18 December capital controls will not be a
permanent measure in the
• China stepped up • China’s State Council and the National Development • China’s capital controls
Middle Kingdom, as the
measures to stem and Reform Commission issued new rules on overseas have proven to be highly
continuation of capital controls
capital outflows mergers and acquisitions where investments are effective. The yuan
will prevent China from
following sharp categorized under three categories: banned, restricted, appreciated to 6.51 against
achieving its long term
devaluation of its and encouraged. This is in line with the state policy the dollar (January 2017:
ambition, which is to
yuan currency amid initiatives. Examples of industries under the three $1=6.94 Chinese yuan
internationalize the Renminbi
a slowing economy categories include the following: renminbi) while the
and to make its financial
and also to curb country’s foreign-exchange
Banned Restricted Encouraged market more international and
the rapid decline reserve posted an eleventh
Industries Industries Industries market-oriented.
of the nation’s straight month increase to
capital reserve. • Military • Real estate & • BRI related USD3.14 trillion (January • In 2016, the renminbi joins the
hotels 2017: USD2.99 trillion). IMF's special drawing rights
• Gambling • Industries that
(SDR) basket, which
• Sex • Film & improve China’s
determines currencies that
entertainment technology /
countries can receive as part of
• Sports research &
IMF loans. This clearly shows
development
that China has a strong desire
• Oil, mining, to internationalize the renminbi
agriculture and over time and capital control
fishing related will not be part of the nation's
long term agenda.CHINESE CORRIDORS
IN MALAYSIA 9
BANDAR MALAYSIA:
WHO WILL LEAD? Image Source:
1 Malaysia Development Berhad
Bandar Malaysia, the redevelopment of the Sungai Besi Air Force base
that was once Malaysia’s first international airport, continues to hog the
limelight. The mega development spanning 486 acres and its twin Date Progress
project, Tun Razak Exchange (TRX) - the new financial district for Kuala 1 Malaysia Development Berhad (1MDB) sold 60% of its equity in
Lumpur, to be undertaken by master developer, 1Malaysia December 31, 2015 Bandar Malaysia Sdn Bhd to IWH-CREC Sdn Bhd, which is a 60:40
joint-venture (JV) between Iskandar Waterfront Holdings Sdn Bhd (IWH)
Development Berhad 1MDB will change the cityscape. and China Railway Engineering Corporation for RM7.41 billion.
While TRX aspires to be the new icon for the financial world leveraging China Railway Group Ltd pledged to invest US$2 billion to build a regional
March 21, 2016
on Malaysia’s leadership in global Islamic finance, Bandar Malaysia will centre in Malaysia.
involve urban redevelopment to transform the old Sungai Besi Air Force The Malaysian government agreed to provide the master developers of
base into a sustainable liveable city. Bandar Malaysia and its subsidiaries with incentives such as income
exemption for 10 years, exemption from stamp duty (eight years), real
June 17, 2016
Envisioned as a world-class city-within-a-city, Bandar Malaysia will be property gains tax (eight years), withholding tax (eight years) and exemption
the country’s first transit-oriented mixed-use cluster offering seamless from import duty on selected constructed materials not manufactured locally.
connectivity via a high speed rail (HSR) terminus to Singapore, the TRX City Sdn Bhd announced that the Bandar Malaysia development
Express Rail Link (ERL), KTM Komuter and Mass Rapid Transit (MRT) May 3, 2017 agreement with IWC CREC Sdn Bhd has lapsed and will be inviting
lines 2 and 3. The development will also strive to be a global business expressions of interest for the role of master developer of Bandar Malaysia.
hub, retail lifestyle destination, creative enterprise hub and the preferred China’s property giant Dalian Wanda Group is considering to take a
May 9, 2017
destination for Gastronomy, Learning, Entertainment and Wellness major stake in the Bandar Malaysia development.
(GLEW) Tourism. Wanda Group’s chairman reiterated that Wanda has the desire to
participate in the Bandar Malaysia project during a joint press
Whilst there have been significant progressions at TRX; little has May 14, 2017
conference with Prime Minister Datuk Seri Najib Tun Razak at the
changed at Bandar Malaysia since the project was unveiled in 2011. Sofitel Beijing Hotel owned by Wanda Group.
The relocation of the air force base is only scheduled to commence in
The Ministry of Finance is issuing the request for proposal (RFP) for
December 2017. companies interested in taking part in the Bandar Malaysia project.
As of 31st December 2017, the behemoth project had yet to identify a To qualify for selection, the candidates must fulfil the following criteria:
July 5, 2017
1. Must be a Fortune 500 company
new master developer. However, the government had reiterated that a 2. Have a cumulative revenue over three years of RM50 billion from
new master developer will be identified soon. Hence, it will be entire value chain of real estate and associated business
3. Have experience in international real estate development projects
interesting to see if this will come into fruition in 2018.
July 25, 2017 Dalian Wanda has reportedly abandoned its bid for the
Bandar Malaysia project.
Treasury secretary-general Tan Sri Mohd Irwan Serigar Abdullah asserts
August 23, 2017 that six companies are vying to be the master developer for the
Bandar Malaysia project.CHINESE CORRIDORS CHINESE CORRIDORS
10 IN MALAYSIA 10 IN MALAYSIA
CHINESE
CHINESE
INFLUENCE
INFLUENCE
ON ON
MALAYSIAN
MALAYSIAN
INFRASTRUCTURE
INFRASTRUCTURE
In a country’s road to becoming
In a country’s
a developed
roadeconomy,
to becoming
infrastructure
a developed
plays
economy,
a vital role
infrastructure
in that development.
plays a vital role in that development.
The lack of said infrastructure
Thewould
lack of
hinder
said infrastructure
the growth of would
the nation.
hinderThe
thesame
growth canofbethesaid
nation.
of Malaysia.
The same can be said of Malaysia.
With Malaysia aiming to become
With Malaysia
a developed
aiming
nation
to become
by the year
a developed
2020, muchnation
more
byhasthe to
year
be2020,
done much
to build
more has to be done to build
up the infrastructure of the nation.
up the infrastructure of the nation.
To this end, Chinese companiesTo this
have
end,
seen
Chinese
muchcompanies
potential inhave
the sector.
seen much
It is apotential
known fact
in the
thatsector.
Malaysia
It isstill
a known fact that Malaysia still
requires higher levels of infrastructure
requires higher
than itlevels
has now,
of infrastructure
in particularthan
areas
it has
outside
now,ofinGreater
particular
Kuala
areas
Lumpur.
outside of Greater Kuala Lumpur.
With this, development in With
transport
this, infrastructure
development is in being
transport
stepped
infrastructure
up in theis country.
being stepped
By 2022, up the
in the country. By 2022, the
scheduled completion of some
scheduled
140kmcompletion
rail link fromof some
the completed
140km rail / on-going
link from /theproposed
completed
Mass
/ on-going
Rapid / proposed Mass Rapid
Transit (MRT) and on-going Light
TransitRail
(MRT)
Transit
and(LRT)
on-going
line 3 Light
will greatly
Rail Transit
enhance (LRT)mobility
line 3 will
andgreatly
connectivity
enhancewithin
mobility and connectivity within
the Greater KL region and help
the Greater
transform KLit region
into a sustainable
and help transform
and liveable
it intometropolis.
a sustainable and liveable metropolis.
The proposed 350km High-Speed
The proposed
Rail (HSR)
350km
line, High-Speed
linking KualaRailLumpur
(HSR)andline,Singapore,
linking Kuala
billed
Lumpur
as a “game
and Singapore, billed as a “game
changer” for both countries
changer”
is a stepfor closer
both countries
to reality isfollowing
a step thecloser
signing
to reality
of the
following
Memorandum
the signing
of of the Memorandum of
Understanding (MoU) between
Understanding
the governments
(MoU) ofbetween
Malaysia theand
governments
Singapore in of July
Malaysia
2016.and
TheSingapore
rail project,
in July 2016. The rail project,
which has a target completion
which date
hasofa2026,
targethas
completion
attracteddatestrong
of 2026,
interesthas
from
attracted
China-based
strong companies
interest from China-based companies
and those from other countries
andsuchthoseasfrom
Japan,
other
South
countries
Korea, such
France
as Japan,
and Germany.
South Korea, France and Germany.
Along with increased participation
Along with
in the
increased
real estate
participation
sector, state-owned
in the real estate
Chinese sector,
companies
state-owned
have also
Chinese companies have also
aggressively expanded theiraggressively
footprints in expanded
the country’s
their
construction
footprints insector.
the country’s
This is causing
construction
concern
sector.
amongThis is causing concern among
local contractors and developers
local contractors
as competition
and heightens
developersamid
as competition
lower volume heightens
of construction
amid lower
contracts
volume of construction contracts
and competitive pricing as foreign
and competitive
players arepricing
at theas
advantage
foreign players
with certain
are atincentives.
the advantage with certain incentives.
According to the Construction
According
IndustrytoDevelopment
the Construction
BoardIndustry
(CIDB) Development
statistics, foreign
Board
contractors
(CIDB) statistics,
clinchedforeign contractors clinched
15.4% (or RM19 billion) of total
15.4% construction
(or RM19 project
billion) of
value
totalinconstruction
Malaysia during
project
the value
year 2015.
in Malaysia
Among during
foreign
the year 2015. Among foreign
contractors, Chinese contractors
contractors,
clinched
Chinese
the lioncontractors
share of 42% clinched
or RM8thebillion.
lion share of 42% or RM8 billion.
VALUE OF PROJECTS BY FOREIGN
VALUE
CONTRACTORS
OF PROJECTSINBY
% FOREIGN
(2015) CONTRACTORS IN % (2015)
42% China 4
25% South Korea25% South Korea
14% Japan 14% Japan
5% Singapore 5% Singapore
5% Indonesia 5% Indonesia
5% Others 5% Others
4% Hong Kong 4% Hong KongCHINESE CORRIDORS CHINESE CORRIDORS
IN MALAYSIA 11 IN MALAYSIA 11
n in the infrastructure
China’s participation
and construction
in the infrastructure
industry ofand
Asiaconstruction
(including Malaysia)
industry isofinAsia
line(including
with the BRI
Malaysia)
as its future
is in line
is closely
with thetied
BRItoas
Asia.
its future
Another
is closely tied to Asia. Another
e firms are
reason
keenwhy
to expand
Chinese in firms
Aseanare
is keen
also due
to expand
to the fact
in Asean
that they
is also
already
due to possess
the facta that
strong
they
presence
already possess
in Africa and
a strong
Middle
presence
East and in Africa
this and Middle East and this
ble destination
makesforAsean
diversification
a viable destination
purposes. for diversification purposes.
UCTURE PROJECTS
NOTABLE WITH
INFRASTRUCTURE
PARTICIPATION
PROJECTS
BY CHINESE
WITHCOMPANIES
PARTICIPATION BY CHINESE COMPANIES
Timeline
Projects Projects Parties Parties
Location Location
Brief Description Brief Description
Contractor: Communication Contractor: Communication
Target Completion Length / Distance: 620 km Length / Distance: 620 km
East Coast Rail Link (ECRL) East Coast Rail Link (ECRL)
Construction Company Ltd (CCCC) Construction Company Ltd (CCCC)
Port Klang - Port Klang -
2024 Estimated Cost: RM55 billion Estimated Cost: RM55 billion
Financing:
Financing: Export-Import Bank of China (EXIM) Export-Import Bank of China (EXIM)
Tumpat Tumpat
Contractor:companies
Contractor: A consortium of three China-based A consortium
– of three China-based companies –
Gemas - Gemas -
Target Completion China Railway Construction Corp LtdChina Railway Construction
(CRCC), Corp- Ltd (CRCC),
Gemas Gemas
Length -
/ Distance: 197 km Length / Distance: 197 km
Johor Electrified Johor Electrified
2021 China Railway Engineering Corp (CREC)China
andRailway Engineering
JohorCorp (CREC) and
Bahru Johor Bahru
Estimated Cost: RM8.9 billion Estimated Cost: RM8.9 billion
Double Tracking Rail Double Tracking Rail
China Communications ConstructionChina Communications Construction Corp (CCCC)
Corp (CCCC)
Enhancement of the New Deep WaterEnhancement of the New Deep Water
IJM Corp Bhd & IJM Corp Bhd &
Target Completion Gebeng, Terminal Gebeng,
(NDQT) - Double capacity toTerminal (NDQT) - Double capacity to
Kuantan Port Expansion Guangxi
Kuantan Beibu International Port Group
Port Expansion Guangxi Beibu International Port Group
2018 Kuantan 52 millionKuantan
freight weight tonnes (FWT)52 million freight weight tonnes (FWT)
(JV 60: 40%) (JV 60: 40%)
Estimated cost: RM4 billion Estimated cost: RM4 billion
KAJ Developments Sdn Bhd & ChineseKAJport operators - Sdn Bhd & Chinese port operators -
Developments Improved port targeted to handle Improved port targeted to handle
Target Completion
Penang Port (Revamp) PenangShenzhen Yantian Port Group Co LtdShenzhen Yantian Port
Port (Revamp) Penang
Group Co Ltd up toPenang
100,000 ships a year up to 100,000 ships a year
2020
and Rizhao Port Group Co Ltd (JV) and Rizhao Port Group Co Ltd (JV) Investment Value: RM6.3 billion Investment Value: RM6.3 billion
A development which will include A development which will include
KAJ Developments Sdn Bhd & KAJ Developments Sdn Bhd &
international cruise terminal, integrated deep sea cruise terminal, integrated deep sea
international
Target Completion PowerChina International Group Ltd and Pulau Panjang,
PowerChina International Group Ltd and Pulau Panjang,
Melaka Gateway Melaka Gateway port, container and bulk terminal, shipbuilding
port, container and bulk terminal, shipbuilding
2025 2 partners Shenzhen Yantian Port Group Co LtdShenzhen Yantian
2 partners Melaka
Port Group Co Ltd Melaka
and ship repair, maritime industrial park
andand
shipmore.
repair, maritime industrial park and more.
and Rizhao Port Group Co Ltd (JV) and Rizhao Port Group Co Ltd (JV)
Total Development Cost: RM42 billionTotal Development Cost: RM42 billion
Expansion of Kuala Linggi Port whichExpansion
opened of Kuala Linggi Port which opened
Linggi Base Sdn Bhd Linggi Base Sdn Bhd
in 2001 – existing facilities mainly serve the O&G
in 2001 industry
– existing facilities mainly serve the O&G industry
Kuala Linggi
Target Completion (port’s
Kuala project owner: TAG Marine) & (port’s project owner:
Linggi Kuala Linggi,
TAG Marine) & Kuala Linggi,
Expansion will provide large scale servicing facilities
Expansion will provide large scale servicing facilities
International2025-2027
Port (KLIP) InternationalChina
Port Railway
(KLIP) Port Channel China Railway PortMelaka
Channel Melaka
aimed at approximately 100,000 ships a year
aimed at approximately 100,000 ships a year
Engineering Group Co. Ltd (JV) Engineering Group Co. Ltd (JV)
Estimated Cost: RM12.5 billion Estimated Cost: RM12.5 billion
To beconsisting
To be developed on 404 hectares of land developed on 404 hectares of land consisting
Expected
Robotic Future to kick off
City, Robotic Future Johor
City, Corp and Johor Corp and
Johor Johor
of robotics factory, R&D of robotics
centre and sales factory,
marketing unit.R&D centre and sales marketing unit.
by 2017
Johor Johor
Siasun Investment Co Ltd (JV) Siasun Investment Co Ltd (JV)
Estimated Cost:RM15 billion Estimated Cost:RM15 billion
Expected to kick off Terminal
Terminal set to be a base for tuna fishing boatsset to be a base for tuna fishing boats
Kedah Integrated Kedah Integrated
Kedah Government and Kedah Government and
by 2017 to be Kedah Kedah
operating in the Indian Ocean. operating in the Indian Ocean.
Fishery Terminal (KIFT) Fishery Terminal
Lu(KIFT)
Hai Feng Ltd (JV) Lu Hai Feng Ltd (JV)
developed over 10 years Estimated Cost: RM3 billion Estimated Cost: RM3 billion
China Communications ConstructionChina Communications Construction Engineering, Procurement & ConstructionEngineering, Procurement & Construction
Awarded
MRT Line 2 Sungai Buloh – MRT Line 2 Sungai Buloh –
Company Ltd & George
Company Ltd & George Kent (Malaysia) KlangKent (Malaysia)
Valley Klang
Contract Sum: Valley billion (Work Package:
RM1.01 Contract Sum: RM1.01 billion (Work Package:
2016
Serdang -Putrajaya (SSP) Line Serdang -Putrajaya (SSP) Line
Sdn Bhd (JV: 51:49) Sdn Bhd (JV: 51:49) trackworks, maintenance vehicles and trackworks, maintenance vehicles and work trains)
work trains)
TRX City Sdn Bhd and TRX City Sdn Bhd and
Major traffic dispersion and Major traffic dispersion and
Tun Razak Exchange Tun Razak
GadangExchange
CRFG Consortium Sdn Bhd Gadang CRFG Consortium Sdn Bhd
2017 Jalan Tun Razak, KL Jalanimprovement
Tun Razak, KL
job worth improvement job worth
(TRX) (TRX)Holdings Bhd JV China Railway
(Gadang (Gadang Holdings Bhd JV China Railway
RM327.91 million RM327.91 million
First Group Malaysia Bhd on (JV: 51:49)
First Group Malaysia Bhd on (JV: 51:49)
Source: Knight Frank Research / various sources
Source: Knight Frank Research / various sources
bout theOne RM12.5notablebillionfactKuala
aboutLinggi
the RM12.5
International
billionPort
Kuala Linggi In August 2017,Port
International Prasarana Malaysia
In AugustBhd 2017, awarded
Prasaranaa major
Malaysia
contract
Bhdworthawarded a major contract worth
State is building
(KLIP) that is that
Melaka it is being
State is financed
buildingbyis BRI
thatfunds RM1.56bybillion,
it is being financed marking the RM1.56
BRI funds start of the billion,
Lightmarking
Rail Transit
the start
(LRT)ofline
the3Light
projectRail Transit (LRT) line 3 project
ompletionfrom of theChina.
BRI will
Thealter completion
trade routes
of theinBRIthe will
region, to a Chinese-German-Malaysian
alter trade routes in the region, to a Chinese-German-Malaysian
consortium. The consortiumconsortium. consisting of The consortium consisting of
undreds of which
billions
may worth
divertofhundreds
trade fromofSingapore.
billions worth A large
of trade from CRRC Zhuzhou
Singapore. A largeLocomotive CRRC Co Ltd,
Zhuzhou Siemens
Locomotive
Ltd China Co andLtd, Tegap
Siemens Ltd China and Tegap
o cargo and partgoods
of thiswithin
is duethe to cargo
regionand heading
goods forwithin
Chinathe or region Dinamik
heading forSdnChina
Bhd or will design,
Dinamik
supplySdn andBhd commission
will design, 42 supply
six-car and
lightcommission
rail 42 six-car light rail
pass the Port
vice-versa
of Singapore
may bypass with the
thecompletion
Port of Singapore vehicles forofthe
of KLIP.with the completion KLIP.37km stretch vehicles
linking forBandar
the 37kmUtama stretch
in Damansara
linking Bandar and Utama in Damansara and
Johan Setia in Klang. Johan Setia in Klang.
tant because
The KLIP the port
is important
will be ablebecauseto servethe port
maritimewill be able to serve maritime
ip repair,services
bunkering suchandasmaintenance,
ship repair, bunkering
which areand facilities
maintenance, Forwhich
the sector, moving forward,
are facilities For the
we will
sector,
likelymoving
see China
forward,
keepingwe will
a close
likelyeye
see China keeping a close eye
rently is unable
that Pork to Klang
providecurrently
due to limitations.
is unable to provide due to limitations. on other Malaysian mega infrastructure
on other Malaysian projects,mega
which infrastructure
includes theprojects,
Kuala which includes the Kuala
Lumpur-Singapore High Speed Lumpur-Singapore
Rail (HSR) via Malaysia
High Speedand theRailPan
(HSR)Borneo
via Malaysia and the Pan Borneo
hinese parties
Other are thanalready
that, Chinese
involved parties
in the building
are already of the
involved in the building of the
Highway in East Malaysia. BRI Highway
relatedin investments
East Malaysia. (BRI),
BRIwhich
relatedareinvestments
linked (BRI), which are linked
ble-tracking
Gemas-Johor
railway, as double-tracking
well as the highlyrailway, impactfulas well
Eastas the highly impactful East
to the Chinese state-ownedto enterprises
the Chinese(SOEs), state-owned
are notenterprises
affected by(SOEs),the are not affected by the
CRL) projectCoast worthRailRM55
Link (ECRL)billion. project
In particular,
worth the RM55 ECRL billion. In particular, the ECRL
capital control. capital control.
bridge between
will act Port
as aKlangland bridge
and Kuantan
between PortPortandKlang
otherand Kuantan Port and other
st Coast of ports
the along
peninsula.
the East Coast of the peninsula. As what is consistent with most As whatinfrastructure
is consistentprojects
with most
of similar
infrastructure
nature, theprojects of similar nature, the
projects are expected projects to improve are the expected
connectivity,
to improve bring the out connectivity, bring out
l enable China-bound
This connection goodswill enable
from Port China-bound
Klang, inland goods
and from Port Klang, inland and
socio-economic impact andsocio-economic
a trickle-down domino impacteffect
and afortrickle-down
business. The domino effect for business. The
moved to the Kuantan
north Port,
to bewithoutmoved havingto Kuantanto stopover
Port, without
at having to stopover at
projects will also facilitate investment
projects willparticularly
also facilitate
in fast
investment
growing and particularly
key in fast growing and key
ng the reverse
Singaporeof theand same taking
route.
theMalaysia-bound
reverse of the same goods route. Malaysia-bound goods
industries such as manufacturing, industries renewable
such as energy
manufacturing,
and biotechnology.
renewable energy and biotechnology.
stop atfromKuantan
China Port, couldnow stopbeing
at Kuantan
deepened Port, andnow being deepened and
Infrastructure is the foundation Infrastructure
of which business
is the foundation
builds upon of which
for growth.
business builds upon for growth.
ing the South
expanded,
Chinaafter Sea.plying the South China Sea.
In addition, the improvementInof addition,
local infrastructure
the improvementwith theof local
involvement
infrastructure
of with the involvement of
ort Klang-ECRL-Kuantan
For Malaysia, the route Port Klang-ECRL-Kuantan
will not only boost trade route will not only boost trade
the Chinese will strengthenthe economic,
Chinese cultural
will strengthen
and diplomatic
economic, relations
cultural and diplomatic relations
eninsula volume
but will for improve
the peninsula
the economic but willand improve
tourismthe economic and tourism
between the countries. between the countries.
East Coast. landscape for the East Coast.You can also read
