Belt and Road initiative vital to bring Asean and China together

On a quarterly basis, HSBC Holdings reported a pre-tax loss of $858 million.

KUALA LUMPUR: The Belt and Road initiative will play a key role in bringing together the 10 Asean member countries with China, the world's second largest economy, said HSBC Bank Malaysia Bhd.

Chief executive officer Mukhtar Hussain said being strategically located in the heart of South-East Asia, Malaysia would not only be the gateway to the Asean market, but also to China.

"Since the implementation of the initiative, both countries have reaped the early benefits of economic investment and have pledged to build a stronger all-round strategic partnership in trade, finance, port development and logistics sectors, among others. 

"In fact, Malaysia continues to gain from China's economic expansion and the republic has remained Malaysia's largest trading partner for the seventh consecutive year since 2009," he said in a statement on Friday.

Mukhtar said Malaysia's trade with China for the first 11 months of 2016 saw a growth of 2.7% to RM216.27 billion.

As for Asean member countries, he said the initiative would help address an infrastructure deficit and lift industrial development.

China's Belt and Road initiative is a prime example of a reaching-out policy, whereby it aims to trigger demand for materials and goods at home by investing in strategic infrastructure projects abroad, grow economic ties along its old silk road to Europe and along newer maritime links in and around Asia and Africa.

The plan aims to enhance global supply chains primarily through debt-financed infrastructure projects across more than 60 countries.

China expects annual trade with these countries to be worth US$2.5 trillion within a decade, up from US$1 trillion in 2015.

"Since the announcement of the Belt and Road Initiative, the Malaysian government has also committed to building and upgrading sea ports in a plan to establish free trade zones and industrial parks to be built near the ports.

"Examples are the sister port developments in Melaka-Guangdong, the Malaysia-China Kuantan Industrial Park and the Qinzhou Industrial Park," Mukhtar added.

Given the vital role China plays in Malaysia and Asean's economic future, HSBC Malaysia will be hosting the Asian and Renminbi Forum in Kuala Lumpur on Feb 27.

The forum will review recent developments and provide strategic perspectives of the prospects for the economies and markets, and touch on the importance of China to Malaysia. - Bernama