China’s BRI vital for Cambodia, Malaysia


KT Staff / Khmer Times Share:

September 10, 2019

Malaysian Prime Minister Mahathir Mohamad says the BRI benefits those who embrace it. KT/Chor Sokunthea

China’s Belt and Road Initiative projects are important because it opens land and sea routes to Europe.

Malaysian Prime Minister Mahathir Mohamad told Khmer Times that: “In so far as the BRI projects are concerned, we are fully supportive because Malaysia also wants to use this passage for trade with the East and the West.”

In addition, it is important, of course, that these trading passages are kept open so that more trade would be possible. After that, we’ll have to engage all the countries along the routes. Central Asia is cut off from the sea, but if they have good communications systems, then they will also prosper.”

He said that while the BRI has much support from countries, such as Malaysia and Cambodia, it is important that investors adjust to local conditions, practices, and prepare themselves for what may come.

Looking at the trade war between China and the US, this is very bad. It doesn’t benefit anybody. Everybody will suffer. But Asean countries, if we work together, we can build a good market for ourselves. This will mitigate the cost of the results of the trade war,” Mr Mahathir said.

There are no winners – only losers and those get ruined, especially those countries who depend on export-related manufacturing. This is because if countries of origin certification are strictly applied, almost every producer and exporter will be affected. One way or another, as it is, all inter-related,” he added.

Mr Mahathir pointed out that Malaysia and Cambodia have enjoyed a long and historic relationship, which stretches over 62 years – same as Malaysia’s independence. Given this long relationship, Malaysia could sympathise with some of the problems facing Cambodia, such as potential sanctions and revocation of the Everything-but-arms trade status, and pressure on its form of democracy.

He noted that there is no denying of Cambodia’s reliance on China on many fronts, primarily infrastructure development and official development assistance.

Cambodia may not have much of a choice because of external pressure on it, but Prime Minister Hun Sen is doing well in establishing bilateral trading pacts with as many countries as possible, particularly European nations,” he said.

Hedging, in terms of politics, trade and economics, is critical for a nation’s survival and as such, it could be wise for Cambodia to also stay engaged with its detractors and maintain its policy of friends with everyone and enemy of none,” Mr Mahathir added.

During his visit to Cambodia, Mr Mahathir stressed that he was visiting an old and trusted friend and that he was pleasantly surprised by the number of questions posed by students at the Royal University of Phnom Penh.

He stressed that Cambodia is on Malaysia’s radar and that Malaysia is concerned about what is happening in the Kingdom.

We think that to the extent that we can, we should help – and certainly, our business people will be encouraged to come here to do business here, but not just think of profits, although that is the main objective, but also think about their responsibility towards the Cambodian people,” Mr Mahathir said.

He noted that the visit was also to renew relations between the two countries, strengthen relations, identify and resolve problems. Mr Mahathir said that in general, both sides need actions so Cambodia and Malaysia can prosper.

Source: Khmer Times “China’s BRI vital for Cambodia, Malaysia”

Note: This is Khmer Times’ report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.

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Bypass Malacca Strait–China’s BRI Strategic Connections to the West


Stratfor’s article “Casting an Eye on the Belt and Road Initiative” on August 28 describes China’s BRI as China’s worldwide ambitious initiative. If China were able to satisfy the needs for construction of infrastructures all over the world, it would certainly be an ambitious initiative to make China world leader. However, China is not rich enough to do so; therefore, it invites other countries to join it in the construction.

As the infrastructures may facilitate other countries’ investment and expansion of market in receiving countries, Japan and EU are interested but still have doubt whether joining China will help China become a world hegemon. Therefore, most of them would rather join the US to demonize China by description of China’s efforts as setting up “debt traps” to hurt receiving countries.

Stratfor’s article however, points out China’s efforts to avoid its BRI projects from becoming debt traps through renegotiation to reduce the debt burdens on receiving countries. However, it fails to see the strategic importance of BRI for China.

First, bypass the Malacca Strait. BRI first of all is aimed at China’s connections to its markets and sources of resources to its West. The old Silk Road is not so important as it’s on land while most trade now is carried out by shipping, which is much less expansive and has much greater volume.

Through development of infrastructures of roads, railways and pipelines, the freight costs have reduced but are still much higher than marine shipping. The freight volume is limited. China has developed rail links with Europe through Central Asia and Russia and would keep such links even if the rail freight is not cost effective enough as they may provide alternatives if marine shipping is cut off by powerful US navy.

Even if China has a relatively strong navy to protect its shipping through the Indian Ocean, the Malacca Strait will be a bottleneck difficult to pass if it is blocked by US military stationed in Singapore.

That is why Hambantota Port is so important. If China can bypass the strait, the port will become the major transport hub as important as Singapore for China’s shipping to its west now.

That is why China is building a railway through Laos to Thailand while Thailand is building a railway linking the railway in Laos to Malaysia. Malaysia has to build its East Coast Rail Link to its port on its western coast. Such a pan-Asia railway will enable not only China but also quite a few Indochinese countries to bypass the Malacca Strait.

The article mentioned the reduction of cost by China for the construction of the East Coast Rail Link though I have mentioned that as China is building a port at Kyaukpyu, Myanmar and the establishment of China-Myanmar Economic Corridor will make the construction of a railway linking Kyaukpyu and China possible. That will give China a much better shortcut to the Indian Ocean without going through the Malacca.

A pipeline from Pyaukpyu to China has already been built and in operation for more than 3 years as a shortcut for shipping of oil to China.

Comment by Chan Kai Yee on Stratfor’s article, full text of which can be viewed at https://worldview.stratfor.com/article/casting-eye-belt-and-road-initiative-china-infrastructure.


Asia Pacific trade pact can go on without India ‘for the time being:’ Malaysian PM Mahathir


Published Sun, Jun 23 2019 • 6:00 PM EDT Updated 4 hours ago

Yen Nee Lee@YenNee_Lee
Key Points

  • Mahathir Mohamad, prime minister of Malaysia, said he’s willing to conclude the Regional Comprehensive Economic Partnership (RCEP) without India “for the time being.”
  • A recent report by Nikkei Asian Review said China has grown impatient with the slow progress on the RCEP talks, and proposed going ahead with just 13 countries — without India, Australia and New Zealand.
  • Mahathir said Malaysia has gained from the U.S.-China trade war, but cautioned that those benefits may only be temporary.

Malaysian Prime Minister Mahathir Mohamad said on Saturday that he’s willing to conclude a mega Asia-Pacific trade agreement without India “for the time being.”

Mahathir was referring to the Regional Comprehensive Economic Partnership, or RCEP, which involves 16 countries in Asia Pacific. Negotiations have been going on since 2013, with one of the major sticking points being India’s reluctance to open up its markets.

A recent report by Nikkei Asian Review said China, growing impatient with the slow progress on RCEP talks, proposed going ahead with just 13 countries — removing India, Australia and New Zealand from the deal.

The 16 countries involved in RCEP are the 10 Southeast Asian nations and six of their large trading partners: China, Japan, South Korea, India, Australia and New Zealand. If the agreement is finalized, the 16 countries will form a major trading bloc that covers around one-third of the world’s gross domestic product.

In an interview with CNBC’s Tanvir Gill, Mahathir acknowledged the hurdles in reaching a deal among the 16 countries.

“I think we will work towards it. It’s quite difficult because we are competing economies … we’re competing with each other and from there, to go on to work together requires some radical change in our mindset. That will take time,” he said in Bangkok, Thailand, where he’s attending a summit for the Association of Southeast Asian Nations.

In the end, we have to stop this trade war and certainly not to escalate (it).
—Mahathir Mohamad Malaysian Prime Minister

The Malaysian leader added that RCEP participants will have to consider which framework works best: China’s proposed 13-nation deal or the original one involving all 16 countries.

“But I think I would prefer 13 … for the time being,” he said, suggesting he’s open to having India, Australia and New Zealand joining the pact in the future.

Trade war escalation

Several participating countries of RCEP have expressed hopes of coming to an agreement by the end of this year, as they say the U.S.-China tariff fight has brought fresh urgency to wrap up talks in Asia Pacific.

U.S. President Donald Trump and Chinese President Xi Jinping are expected to meet later this month at the G-20 summit in Japan. But Mahathir — like many who follow the developments closely — said he doesn’t expect much to come out of that meeting.

Taking sides in the trade war will be a ‘disaster for the world:’ Mahathir

Malaysia has often been cited as one of the beneficiaries of the trade war as companies move production out of China to circumvent elevated U.S. tariffs. Muhammed Abdul Khalid, an economic advisor to Mahathir, told CNBC in May that the Southeast Asian nation’s growth is set to gain an additional 0.1 percentage points due to the trade diversions to his country.

While that’s good for Malaysia, Mahathir on Saturday cautioned that such benefits may only be temporary. He explained that if there’s a change in government in the U.S., the new administration may have a new set of policies that could once again prompt companies to rethink where they want to locate their production and supply chains.

“In the short term, I think it is good news. But in the end, we have to stop this trade war and certainly not to escalate (it),” he said.

Source: CNBC “Asia Pacific trade pact can go on without India ‘for the time being:’ Malaysian PM Mahathir”

Note: This is CNBC’s report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.


Malaysia pledges to use Huawei ‘as much as possible’


After China accuses US of ‘economic terrorism,’ Malaysian PM Mahathir picks sides in tech cold war

By Asia Times staff

China’s Foreign Ministry doubled down Thursday on its accusation that the United States is engaged in “economic terrorism,” a sentiment that now appears to be winning support in the region.

“This kind of deliberately provoking trade disputes is naked economic terrorism, economic chauvinism, economic bullying,” Vice-Foreign Minister Zhang Hanhui told reporters. Foreign Ministry spokesman Lu Kang said on Thursday that he “could not agree more” with Zhang’s remarks.

Malaysian Prime Minister Mahathir Mohamad, whose election last year was seen by many as a rebuke of China’s growing influence in the region, did not hold back in his support of Beijing’s view on this issue.

“‘If I am not ahead, I will ban you, I will send warships’ – that is not competition,” Mahathir said, as quoted by Malaysian newspaper The Star.

Speaking at an event in Tokyo hosted by Nikkei, Mahathir pledged that Malaysia “will make use of [Huawei’s] technology as much as possible,” asserting that the Chinese telecommunications champion had made tremendous advances over US technology.

He added that he was not concerned about US accusations of espionage on the part of Huawei.

The administration of US President Donald Trump placed Huawei on an export-control blacklist several weeks ago, a move that could threaten to slow the company’s ascendance on the global stage.

Vice-Foreign Minister Zhang said in his remarks this week that “this trade clash will have a serious negative effect on global economic development and recovery.”

The sentiment is clearly shared by others in the region, including Mahathir, who was elected in part to provide a check on China’s economic influence in Malaysia through infrastructure projects.

Source: Asia Times “Malaysia pledges to use Huawei ‘as much as possible’”

Note: This is Asia Times’ report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.


M’sia to enter 10 new halal markets via China’s Obor initiative


Bernama (Updated )

Malaysia will expand its halal services to 10 new countries through China’s US$1 trillion investment – One Belt, One Road (Obor) initiative, says the Halal Industry Development Corporation (HDC).

Its vice-president Hanisofian Alias (photo, above) said the new countries include Kazakhstan, Uzbekistan, Egypt, Turkmenistan, Iran, Tajikistan and Bosnia and Herzegovina.

“Along the Obor route, there are about 10 Muslim-majority countries and we have identified opportunities in these new markets.

“For example, in Kazakhstan and part of Russia, whereby our ministry will be having a joint economic commission meeting (with its Russian counterpart) at the end of this year,” Hanisofian told Bernama during a four-day working visit to the Seoul Food 2019, which began yesterday.

The event was organised by the Korea Trade-Investment Promotion Agency (Kotra), a state-funded organisation, which aims at facilitating South Korea’s export-led economic development via various trade promotion activities.

Last March, HDC signed a memorandum of understanding with Kotra, with the strategic aim of enhancing halal bilateral trade and investment exchange, as well as market access for halal products and services between both countries.

Elaborating further, Hanisofian said these countries had been showing a keen interest in their domestic halal industry developments.

“We are expanding into these countries via internationalisation approach based on five main features, namely opening new markets, rebranding, expanding services and products from Malaysia, human resources development and thought leadership, which uses Malaysia as a reference centre for the world’s halal industry,” he said.

He said HDC would also leverage its halal services by exporting more food products to China, home to 1.4 billion people, of which 26 million are Muslims, with its domestic halal market growing by 10 percent per annum.

Last April, Prime Minister Dr Mahathir Mohamad attended the Obor Summit, which he described as “a very successful trip”.

The international forum was attended by 37 world leaders and 5,000 representatives from 150 countries.

Also in the same month, Malaysia received an injection of RM3.7 billion in palm oil deal, following the revival of the stalled East Coast Rail Link.

Hanisofian also said that apart from new trade collaborations with the 10 countries, the HDC, which falls under the Economic Affairs Ministry, would also be focusing on its cooperation with South Korea.

“In South Korea, we are going to focus on the education sector as well as human capital development, involving cooperation between our local universities and the Korean ones.

“We also see opportunities in the Muslim-friendly hospitality sector, as well as 7sharing expertise in terms of research and development, and innovation,” he said.

Asked about the potential export value for the year, Hanisofian said it was a tad premature to project.

Malaysia’s halal export to South Korea in 2018 was at RM1.28 billion, with three product categories having the highest export values being halal ingredients (RM600 million), food and beverages (RM594 million) and cosmetics and personal care (RM80 million).

Source: malaysiakini.com “M’sia to enter 10 new halal markets via China’s Obor initiative”

Note: This is malaysiakini.com’s report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.


ECRL needs to bring industrial growth to east coast – Azmin


Bernama

April 30, 2019 14:45 pm +08

MELAKA (April 30): The East Coast Rail Link (ECRL) project needs to bring new industries and industrial sector development to the East Coast, which in turn, spurs economic growth that benefits the people, says Economic Affairs Minister Datuk Seri Mohamed Azmin Ali.

He said if there were no new industries and growth, no cargo to be transported via the ECRL, then there is be no reason to proceed with the project.

“Among the new conditions we laid down was to bring new industries to the East Coast. The ECRL is important if there is industrial growth that can generate economic growth and transfer of industrial cargo to Port Klang,” he said.

Mohamed Azmin said this to reporters after delivering his keynote address titled “People’s Hope Development: A New Malaysia Mechanism or Just a Rebranding?” at the Melaka Berwibawa Seminar in Bandar Hilir, here today.

The two-day seminar, which started yesterday, was officially launched by Melaka Chief Minister Adly Zahari earlier. Also present was Deputy Primary Industries Minister Datuk Seri Shamsul Iskandar.

It was reported that the ECRL project would be revived and the construction costs for Phase 1 and Phase 2 have now been reduced to RM44 billion from RM65.5 billion.

Mohamed Azmin said the project’s RM21.5 billion savings was not due to the scaling down of its scope and specifications as alleged by several parties, instead they remained unchanged.

“It is still double track and the alignment and distance is about the same. What happened is that we do not allow them to pass through Gombak as there is a dam there and we do not want any problems (to occur). This decision was made when I was the Selangor Menteri Besar.

“We also have the Klang Gates Quartz ridge which was registered with Unesco as the world’s longest quartz ridge and we do not want them to bore through it and construct a RM10 billion tunnel. We’ve saved almost RM10 billion here.

“We are against the abuse of power, corruption and leakages, and we will continue with these practices and principles, including for the Bandar Malaysia project which will be governed by a new development concept,” he added.

Source: theedgemarkets.com “ECRL needs to bring industrial growth to east coast – Azmin”

Note: This is theedgemarkets.com’s report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.


Less traffic congestion for Port Klang residents once ECRL completed, says MP


1 May 2019

PORT KLANG, May 1 — The decision to resume the East Coast Rail Link (ECRL) project is expected to provide comfort to the local residents who have been facing traffic congestion and damage to infrastructure due to container lorries plying the roads in the port town for so long.

Port Klang assemblyman Azmizam Zaman Huri said the realignment of ECRL that focusing on the cargo segment would provide comfort to local residents who had been competing with container lorries on the roads on daily basis for so many years.

“Based on the data I received, there are about 300 transport companies operating here with a total of 8,525 containers lorries, used to transport cargo from two major ports operating here, the West Port and North Port.

“With less number of container lorries (once ECRL completed) here I expect the presence of domestic and foreign tourists will increase as Port Klang has various tourist attractions including floating houses, fishermen and indigenous villages in Pulau Indah,” he said when contacted by Bernama here today.

Earlier this month the government announced ECRL would resume at a lower cost following the signing of supplementary agreement (SA) between Malaysia Rail Link Sdn Bhd (MRL) and China Communications Construction Company Ltd (CCCC).

The original RM65.5 billion construction cost for Phase 1 and 2 had been reduced to RM44 billion, a reduction of RM21.5 billion.

The new ECRL alignment will run through 20 stations, among others, from Kota Baru to Kuala Terengganu, Kuantan, Mentakab and proceed to Jelebu, Bangi/Kajang, Putrajaya Sentral and onto Port Klang.

Council of Eminent Persons (CEP) chairman Tun Daim Zainuddin said cargo load would bring in more profit to ECRL compared to passenger ridership as the rail link would cut travel time significantly between Port Klang and Kuantan Port.

The cargo load would contribute an estimated 70 per cent to revenue versus 30 per cent for passenger traffic due to its shorter travel time and greater reliability as a mode of transport. — Bernama

Source: Malaymail.com “Less traffic congestion for Port Klang residents once ECRL completed, says MP”

Note: This is Malaymail.com’s report I post here for readers’ information. It does not mean that I agree or disagree with the report’ views.