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Manufacturers, infrastructure, tech looking at Iskandar

Reporter: Rian Maelzer 丨 CCTV.com

11-11-2016 05:31 BJT

Malaysia has become China's biggest trade partner in the ASEAN community, and ties are even stronger now with a new wave of Chinese investment going to Malaysia. The Iskandar economic region lies in the southern part of Malaysia, situated at a strategic point on the Belt and Road route, and companies based there enjoy tariff-free access to the ASEAN economic community, making it attractive to Chinese companies.

One-hundred thousand spinners churn out cotton yarn destined to be shipped back to China.
This plant in the Iskandar Economic Region was set up by China’s Daiyin Textile company. It aims to greatly expand here, eventually producing everything from yarn right to finished garments.

“Malaysia number 1 has a good relationship with China. Number 2, the raw materials here are cheaper than in China. Number 3 also the infrastructure are well set up and now Malaysia production cost in lower than China. Also, it’s very convenient when we send our goods to port,” said Steven Cheng, general manager of D & Y Textile.

Despite all those advantages, plus the proximity to Singapore, Chinese interest in Iskandar was slow to materialize.

“That is understandable for the fact that it would take us a while to be able to promote Iskandar to the rest of the world. But over the last five years, the interest coming in from China has been huge,” said Ismail Ibrahim, chief executive of Iskandar Regional Department Authority.

China’s investments in the real estate and construction sectors have made it the number one foreign investor in Iskandar.

Chinese industrial investment in Malaysia includes train building and rail infrastructure development, upgrading and building ports, steel making and power production.

In Iskandar, Chinese companies are making electrical transformers and doing aluminium smelting. And a Chinese firm will do the final phase of double tracking and electrification on the country’s main north-south rail line, linking it up to Iskandar in the south.

But D & Y are by far the largest Chinese manufacturing operation here.

“Hopefully our achievement will bring in more Chinese investment into Malaysia,” Steven Cheng said.

It’s a hope that will be shared by Malaysia’s government, which is banking on the Iskandar region to be a key engine of the country’s economic growth.

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