Earlier this month, Malaysia’s government announced it would resurrect two China-linked projects: the East Coast Rail Link and the Bandar Malaysia project, a multibillion-dollar property and transportation project in Kuala Lumpur. If Malaysia really ran the risk of being caught in China’s web and falling into a debt trap with China-linked projects, why would it resume those China-linked projects? Malaysia isn’t stupid. In any case, the independent sovereign state won’t sacrifice its own interests.
The Bandar Malaysia project has an estimated cost of 140 billion ringgit ($34 billion), according to media reports, imposing a debt burden on the Southeast Asian country, but this doesn’t represent the entirety of the project. Malaysian Prime Minister Mahathir Mohamad was quoted by media reports as saying that the project “is expected to have a tremendous impact on urban development in Malaysia.” It will draw major multinational corporations and Fortune 500 companies to invest in Kuala Lumpur, widening inbound investment from China, which was the largest foreign investor in Malaysia’s manufacturing sector in the first half of 2018.
In the early days after his election, Mahathir sent a message about his wish to improve Malaysia’s fiscal position, but he is not fundamentally against the Belt and Road Initiative (BRI). Like China, Malaysia’s primary strategy is to promote economic and social development. When revenue is greater than expenses, most people will be willing to carry the debts.
Malaysia’s export situation is far from optimal, and there is a great need to increase its traffic links to the outside world to promote exports. That’s where the China-funded infrastructure projects come in. Since its inception in 1967, the Association of Southeast Asian Nations (ASEAN) has launched several initiatives to promote economic integration among its members. Chinese investment means the acceleration of ASEAN’s own initiatives.
Some US observers and intellectuals may want to derail China-ASEAN cooperation under the BRI. This goal seems to be always just on the horizon, but forever unreachable. Why? That’s because they ignore that attracting foreign investment and promoting economic integration meets ASEAN’s own demand.
Those US observers will be disappointed. Malaysia is unlikely to drift apart from Beijing. On the contrary, it will enhance its economic ties with China.
The author is a reporter with the Global Times. bizopinion@globaltimes.com.cn
