Expert Predicts More Chinese Funds Will Flow Into Malaysia
KUALA LUMPUR: Chinese investments will continue to stream into Malaysia, particularly in the real estate, manufacturing and logistics segments, said Knight Frank Malaysia Sdn Bhd executive director Allan Sim.
China has invested RM4.77 billion in 33 local manufacturing projects and it is also involved in 22 property development projects, with an accumulated gross development value of RM581.2 billion.
Sim said the tie-up between both countries, especially for the KLIA Aeropolis Digital Free Trade Zone (DFTZ) park and other projects in the e-commerce segment, could potentially spark more interest in the logistics segment.
Funds from China's One Belt, One Road initiative are being used to finance the Kuala Linggi International Port (KLIP) in Malacca at a cost of RM12.5 billion.
"This is just the beginning of more potential collaboration, as e-commerce is booming.
"It seems that e-commerce is not going to stop, and this might lead to more ports in Malaysia being expanded to cater to demands from the industry" Sim said after launching the research report on Chinese investment trends across the Asia Pacific here today.
The report revealed that despite China's curbs on capital flight, as well as the property glut on the domestic front, Chinese interest in the country remains, with the focus on manufacturing, logistics, construction and real estate.
More Chinese developers are also seen to be participating in smaller and niche projects, targeting the domestic market.
Asked whether this would negatively affect domestic developers, Sim said the local industries would benefit from the transfer of technology while more manufacturers were also expected to set up production facilities locally.
The report also noted that between 15% and 25% of the 500 large Chinese corporates had highlighted they were looking to invest in Asean and Malaysia as a preferred destination.
"Tariff-free access to regional markets, lower operational costs and tax incentives are among the attractions that entice these investors" the report said.