BRI-nging growth to Asean

The Belt and Road Initiative (BRI) carries forward the vision of the Silk Road, an intent for friendship shaped over two millennia ago. Today, the BRI envisions a global community with a shared future, a partnership rooted in mutual prosperity.

Since 2013, the BRI has built on the momentum of its multilateral political and trade relations with the global community and has completed 254 projects, with 89 ongoing and 66 planned. Trade volume between China and Asean exceeded a total of about US$1 trillion in 2024. Within this context, Malaysia was China’s second-largest trading partner in ASEAN, with a total trade value of CNY 1.5 trillion (US$212bil ) for the same year.

The BRI has played a key role in catalysing some of ASEAN’s key industrial growth and infrastructure development. At home, some of the key Malaysia-China collaboration includes projects like the “Two Countries, Twin Parks model: Malaysia-China Kuantan Industrial Park & China-Malaysia Qinzhou Industrial Park”, and the ambitious East Coast Rail Link (ECRL) to connect Malaysia’s east and west coasts which is now in the final phase of construction and is expected to be operational by late 2026 /early 2027.

There is also growing interest from Chinese investors in the newly set-up Johor-Singapore Special Economic Zone (JSSEZ), the most recent involving Rianlon Corporation investing US$120mil in its first overseas plant in the special economic zone.

By leveraging on projects as a means for regional cooperation and capacity building, these collaborations have catalysed cross-border industrial connectivity, logistics and investment flow between China and Malaysia, and similarly for other large infrastructure and industrial projects, between China and ASEAN.

Asean Rising: A New Chapter of Collaboration with China’s Capital Markets

The region’s growing ambitions for greater interconnectivity and growth present a potentially complex interplay of dimensions that encompasses regional, multi-country and participant alignment and agreement from a financial, regulatory, political and commercial perspectives.

These factors involve considerations of bankability and financial viability, a clear and predictable investor framework, understanding and mitigation of risk, environment, social and governance (ESG) considerations, to the practical funding mix and sources of capital to core questions of the participating capital market’s regulatory framework and ability to mobilise institutional capital to provide medium to long-term funding.

As countries and companies look ahead and plan for 2026 and beyond, navigating the effects of tariff volatility and disruptions is top-of-mind. Robust risk management advocates for diversification to manage dependencies on all fronts – from trade, supply chain, and funding sources.

The current environment presents an opportunity for any institutional investor or partner with a clear policy for collaboration backed by a deep and liquid financial and capital market ecosystem to match the capital needs and mega ambitions of the Asean bloc.

Conversely, China’s increasing openness and market reforms presents institutional investors with an attractive proposition: access to one of the world’s largest and growing centres of innovation and growth in renewable energy, electric vehicles, advanced manufacturing, and artificial intelligence, to name a few, in a stable and gradual momentum build-up.

Malaysian institutions (pension funds, asset managers, sovereign entities) are already exploring China-linked opportunities — from equities to bonds to ESG-aligned funds. A key example is the Employees Provident Fund (EPF), looking to diversify global investment exposure into China in search of higher growth.

Deepening the China-Asean Capital Market and Financing Cooperation

China’s capital markets—both equity and debt—are very large. Today, China’s Shanghai Stock Exchange ranks fourth with 2,288 listed companies and a market capitalisation of over US$8.7 trillion and the Shenzhen Stock Exchange ranks seventh with 2,880 listed companies and a market capitalisation of over US$5.9 trillion as of October 2025.

China’s local currency bond market, the world’s second-largest bond market, grew to US$26.5 trillion as at the end of June 2025, supported by expansions in both the government and corporate segments.

In the meantime, China continues to lead the green bond market in emerging East Asia where green bonds dominate the sustainable bond market with a share of 86.8%, consistent with market efforts to transition to a low-carbon environment.

To-date, there have been encouraging co-financing and dual listings, strengthening capital flows via cross-border listings, joint funds, and RMB-denominated investments — allowing Aseanfirms to tap into China’s deep capital pool while giving Chinese investors greater access to Asean’s growth stories and liquidity.

Increasing regulatory cooperation and supportive financial infrastructure have allowed for mutual recognition of fund products and lower friction, allowing cross-listings of companies on the mutually recognised stock exchanges.

A key milestone for Malaysia especially, was the recognition of the Zhengzhou Commodity Exchange (ZCE), the Shanghai Futures Exchange (SHFE), and its subsidiary, Shanghai International Energy Exchange (INE) as Specified Exchanges in Malaysia. This development builds on Malaysia’s long-standing relationship with China’s Dalian Commodity Exchange (DCE).

Shared Prosperity Through Deeper Integration

As markets around the world embrace protectionism, Asean must find new ways to collaborate and chart paths forward to support its expansive growth and ambitions. China’s capacity and track record for supporting complex mega infrastructure projects, both locally and internationally, especially within the framework of the BRI, reaffirm its long-term commitment to mutual prosperity underpinned by collaboration, connectivity and capital market openness.

To this end, CGS International Securities Malaysia (CGSI Malaysia), through our parent company, China Galaxy Securities, has the network to harness these mutually beneficial opportunities and translate them into real economic/financial outcomes, advancing the next phase of BRI cooperation towards achieving Asean’s goals.

As proof of this, this year alone, CGSI Malaysia has entered into a total of eight memorandums of understanding (MOUs), which exemplify the spirit of Malaysia/Asean-China mutually beneficial cooperation.

To cap these achievements, China Galaxy Securities and CGSI Malaysia co-organised the Malaysia sub-forum of the 2025 Beijing Financial Street Forum in Kuala Lumpur at the end of October 2025, with distinguished speakers from Malaysia, China, Brazil, Uzbekistan, Senegal, Morocco and Kazakhstan exploring key themes and emerging trends on high-quality BRI cooperation.