“With Obor (One Belt, One Road), it will build momentum and provide diversity to the investor base in Malaysia.”

MAK JOON NIEN, Standard Chartered Bank Malaysia banking country head and managing director

CHINA’S One Belt, One Road (Obor) initiative will build momentum for foreign issuers in Malaysia’s bond and equity markets.

Standard Chartered Bank (StanChart) Malaysia banking country head and managing director Mak Joon Nien said asset managers from Hong Kong were interested to come to Malaysia to leverage on Obor.

“With Obor, it will build the momentum and provide diversity to the investor base in Malaysia to include more international players as well as local companies raising funds from Obor or nexus perspectives,” he said at a media briefing, here, yesterday.

Initiated by China four years ago to promote free trade and connectivity between the Asian, European and African continents, Obor looks to boost trade by providing infrastructure such as ports, railways and expressways.

“Asset managers who are linked to state-owned enterprises have, within their priorities, investments abroad and Malaysia is ranked as a key market for them to tap the opportunities,” said Mak.

The Malaysian bond market has been fairly liquid in Asia, with an average RM80 billion to RM100 billion raised, and many feel it is timely to tap the ringgit liquidity now.

Mak said Issuances linked or related to Obor would provide a “fantastic avenue” for investors to come to Malaysia.

But he said it was early days yet for any Chinese company to list on Bursa Malaysia as the Chinese companies were well-funded.

“The issue now with infrastructure projects has to do with the equity component — if we can attract jointventure partners through equity and other forms like bonds.”

If there are different levels of asset managers coming in, such as hedge funds or mezzanine funds, that will provide diversity.

Mak admitted that there must be more awareness on the ground to get more public buy-in.

StanChart China managing director and cash and transaction banking head Jiwei Ye said the bank’s historical experience in China would enable it to provide the linkage with Chinese companies.

“Obor is the single most important globalisation initiative in the world right now, with more than 60 countries participating with multi-banks partnering.”

StanChart participated in 40 projects related to the initiative last year via bank guarantees and various forms of financing in Asean and South Asia.

Mak said this year, the bank was involved in helping to procure guarantee with regards to one of the Obor initiatives in Malaysia.

On risks, economist Edward Lee said domestic fears were not exclusive to Malaysia.

“Whether the infrastructure turns out to be a white elephant is a risk as these projects have long gestation periods. But the government would like to see there is a real need and economic value to it. Infrastructure attracts more investments to the country,” he said.

Asset managers who are linked to state-owned enterprises have, within their priorities, investments abroad and Malaysia is ranked as a key market...

MAK JOON NIEN Standard Chartered Bank Malaysia banking country head and managing director