Prospering with Belt and Road to reap the benefits of China’s initiative


Malaysia is one of 64 countries to reap the benefits of China’s initiative.

CAN money grow on fruit trees?

Yes, that is as far as Agriculture and Agro-based Industry Minister Datuk Seri Ahmad Shabery Cheek is concerned.

After witnessing the signing of a deal worth US$1.53bil (RM6.65bil) between Malaysia’s AgroFresh International and China’s Dashang Group for the export of local Cavendish bananas and tropical fruits to China, he said:

“Money does grow on fruit trees if our agriculture products could open up China’s market.”

The deal was part of the nine memorandums of understanding (MoUs) and agreements, with value totalling more than US$7.22bil (RM31.26bil), which were signed between Malaysian and Chinese companies on May 14.

But Datuk Seri Ong Ka Chuan, International Trade and Industry Minister II, sees more money flooding in once Malaysia is linked up with other Asean nations, China and Europe via rail connection under China’s Belt and Road Initiative, now termed as the New Silk Road project.

“Our trade figures can jump by three to four folds once Malaysia can export and import goods to our major trade partners (such as China, Europe and Middle East) overland via rail systems,” he tells Sunday Star.

Both ministers are among Cabinet members in the Malaysian delegation led by Prime Minister Datuk Seri Najib Tun Razak to attend the Belt and Road Forum for International Cooperation held in Beijing from May 14 to 15.

Malaysia is one of the 64 countries outside China that have benefited from the Belt and Road Initiative, propounded by Chinese President Xi Jinping in the autumn of 2013.

One project to be launched soon will be the RM55bil East Coast Rail Link. Examples of existing projects include Xiamen University and the deepening of Kuantan Port.

At the opening ceremony of the forum, Xi injected fresh impetus to his pet project by announcing hundreds of billions in new funds for infrastructure investment in Belt and Road countries that span Asia, Middle East and Europe.

According to some estimates, Chinese funds allocated for investing in Belt and Road countries – which include several exiting funds announced since 2013 – total around US$900bil (about RM4 trillion) now.

“Model of regional cooperation”

From Mongolia to Malaysia, Thailand to Pakistan and Laos to Uzbekistan, many projects, including high-speed railways, bridges, ports, industrial parks, oil pipelines and power grids, are being built, Xi said.

Since 2013, Chinese private businesses have invested more than US$60bil (RM260bil) in countries along the Belt and Road, in addition to the US$50bil invested by the Chinese government.

Xi’s speech also reveals that China will expand China-Europe railway cargo services, which are stirring up excitement in European nations – particularly Britain.

Belt-road: Ong signing Belt and Road MoU with Vice Chairman of National Development and Reform Commission of China Zhong Yong on May 13, 2017. Witnessing are Najib and China’s Premier Li Keqiang.

Calling his brand of globalisation as “project of the century” to achieve a win-win situation for all, Xi has committed to importing US$2 trillion (RM8.7bil) of goods from the 64 Belt and Road countries – many of which are under-developed and impoverished nations hungry for infrastructure and industrial investments.

The Chinese leader’s pledge of “non-interference” with the domestic politics of other countries is comforting, given that there are concerns that China could aim to be a hegemony with its economic and military might.

“What we hope is to create a big family where we can co-exist harmoniously,” Xi said last Sunday in his speech that also focused on connectivity in policy, infrastructure, trade, finance and people.

The forum is by far the most important and largest meeting on the Belt and Road Initiative since 2013.

About 130 countries were represented at the forum and they accounted for two thirds of the world’s population. Their combined gross domestic product accounts for 90% of the world’s total, according to Xinhua.

Klaus Schwab, founder and executive chairman of the World Economic Forum, regards the Belt and Road Initiative as “a shining model for regional collaboration, development and growth”.

“This initiative respects the differences between countries and their various paths for development, not imposing a specific plan or ideological framework, but seeking to create common ground for cooperation and mutual benefit,” Schwab told Xinhua.

UN secretary-general Antonio Guterres, also told Xinhua: “China will play a very important role in multi-lateralism with the Belt and Road. The initiative reflects a new model of international cooperation and interaction with mutually beneficial cooperation through the connection of policies and development strategies.”

And Jack Ma, executive chairman of Alibaba Group, shared: “The initiative goes far beyond the economic strategy of any single country or region. Its mission is to make the world more innovative, dynamic, and equal.”

Big step: Fernandes is excited that China has allowed AirAsia to be the first low-cost carrier to set up shop in the Middle Kingdom.

AirAsia deal – another first in China

On the sideline of the forum, Malaysian and Chinese leaders took the opportunity to clinch more agreements that brought bilateral ties to another new high.

While the deals signed last November were far more than this round and higher in total value, the Chinese Government continued to grant “first” to Malaysia. This was reflected in a project given to Tan Sri Tony Fernandes, group chief executive officer and founder of AirAsia Bhd. Soon, the sky will see AirAsia China.

“It is the first time a foreign airline is given permission to establish and operate a low-cost carrier in China. We are the first country to be granted such licence,” Najib told reporters at the conclusion of his visit to China.

AirAsia is establishing a joint venture with China Everbright Group, with an initial stake of 22%. However, AirAsia may raise its stake in future.

China Everbright is a government-owned financial services conglomerate, which is a major shareholder in China Aircraft Leasing Group Holdings Ltd and the Henan Government Working Group.

The plan is to set up AirAsia China to be based in Zhengzhou, the capital of Henan, to ply domestic and international flights.

“Tony Fernandes was very excited because he was able to meet the top transport and aviation officials, whom he could not secure appointments with previously. He has been working on this project for years,” a minister told Sunday Star.

Other Cabinet ministers are also upbeat after attending the Belt and Road Forum.

“I have witnessed the fruits of the close diplomatic ties between Malaysia and China, and between Najib and Xi Jinping during this trip,” says Transport Minister Datuk Seri Liow Tiong Lai, who signed a MoU on infrastructure cooperation with China.

“In China, economic developments are influenced by government policies. Now that our leaders have good ties with China, it is very timely for Malaysian businessmen to enter China, and vice versa,” he tells Sunday Star.

Important talks: Liow (second from left) leading a Malaysian delegation at a meeting with his Chinese counterpart at China’s Transport Ministry in Beijing on May 12 morning. From left are Transport Ministry deputy secretary-general Datuk Chua Kok Ching, MCA vice president Datuk Dr Hou Kok Chung and Fernandes.

“We have to promote economic growth fast enough so that we can harvest the fruits of the Belt and Road Initiative.

“The opportunities for Malaysia to develop the infrastructure and boost economic growth would not be available if not for the Belt and Road Initiative pushed forward by China,” he adds.

Minister in the Prime Minister’s Department Datuk Seri Dr Wee Ka Siong observes: “There are quite a number of business-to-business MoUs signed during this trip, in addition to the nine witnessed by Prime Minister Datuk Seri Najib Tun Razak.

“I was also invited to attend many discussions and meetings, sometimes I had to have many meals a day! (as discussions were held over meals).”

Wee, whose ministerial portfolio covers development of Chinese small and medium enterprises (SMEs), has personally requested Ma to reduce charges for Malaysian SMEs when they use Alibaba’s platform to sell products.

Ma, an e-commerce wizard and China’s second richest man, is expected to give consideration to the proposal as he has pledged to help Malaysia develop its digital economy. Ma will set up the Asean data centre in Malaysia before the end of the year.

Analysing Belt and Road Initiative, Shabery Cheek says: “Belt and Road is a different form of cooperation from other pacts, such as the Trans-Pacific Partnership (TPP) and World Trade Organisation (WTO). Those emphasised on what goods were tax-free and what were not, which sectors to open up and which could not. Essentially, they focused on how to protect the self-interests of individual countries.

“However, the Belt and Road talks about infrastructure networking, which is very important. They take the cue from the ancient Silk Road, which was not only a channel to transport goods, but also to spread Islam and Buddhism. That is a great thing.”

Source: Sunday Star by Ho Wah FoonTho Xin Yi

Related Link:

Trade can be boosted several fold
Related posts:

One Belt One Road paving the way to success 

Belt-road changes world order 

Xiamen University shaping up to be the largest foreign university campus in Malaysia 

A new China in the making at Xiamen International Fair for Investment and Trade (CIFIT) 

Liberty, Equality and Fraternity in the 21st century of China’s One Belt One Road strategy

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