Envoy: Projects progressing smoothly

Growing strong: (From right) East Coast Economic Region Development Council chief executive officer Datuk Seri Jebasingam Issace John and Dr Huang visiting the Malaysia-China Kuantan Industrial Park. — Bernama

KUANTAN: China’s investments in the Malaysia-China Kuantan Industrial Park (MCKIP) will not be affected by Beijing’s capital controls as these are genuine business activities.

MCKIP, a government-to-government project, has attracted investments totalling RM18bil – mainly from mainland China.

China’s Ambassador to Malaysia Dr Huang Huikang said his country’s new requirements on foreign exchange transactions were aimed at stopping money laundering and other illegal activities.

Projects with Chinese investments in Malaysia, he said, were still “progressing smoothly”.

“We are only strengthening our financial management to curb outflow for unlawful activities,” Huang told reporters during a visit to MCKIP yesterday.

There were recent reports that the Chinese government had prohibited some major corporations and people from converting yuan to other currencies to invest in offshore properties.

Dr Huang said China was the largest foreign investor in Malaysia’s manufacturing sector and its largest source of foreign tourists outside the Asean region.

Guangxi Province Commerce Department deputy director-general Tan Xiuhong told visiting Malaysian reporters in Nanning that the crackdown on capital outflows was only to limit corporations with “irregular operations” outside China.

Tan, who had just returned from a meeting at China’s Commerce Ministry, said she has an accurate picture of the objectives of the new control measures.

She said she was confident that these controls would not affect China’s investments in Malaysia, “at least not in the twin industrial parks in Qinzhou and Kuantan”, which were supported by both governments.

Both MCKIP and the China-Malaysia Qinzhou Industrial Park are under a unique “two countries, twin parks” model. Located within the East Coast Economic Region, MCKIP is developed on a 51:49 joint venture between major Malaysian and Chinese consortiums.

Totalling 2,000 acres, it has attracted domestic and foreign investments, and created 24,140 jobs.