Opportunities for Malaysia

But what about Malaysia specifically? What impacts do we expect in our economy and industry landscapes? According to Goh, majority of our industries and sectors all set to be beneficiaries of the BRI. Infrastructure- related development sectors

However, the first sectors and industries set to see tangible benefits are our infrastructure-related development in sea, land, air transport; energy; water information communications; and pipelines.

While majority of the recent infrastructure development projects falling under BRI umbrella have been clinched by Chinese-national companies, reports have noted that provisions put into place by our federal government require that a certain percentage of sub-contracting job packages be awarded to Malaysian companies.

Thus, boosting greatly boosting our infrastructure-related development sector.

One example of a Malaysian company potentially walking away with a subcontracting job soon is Vivocom Intl Holdings Bhd (Vivocom).

In a research report by MIDF Amanah Investment Bank Bhd, its research arm shared that it expects China Railway Construction Corp Ltd (CRCC) to clinch a RM450 million to expand Sultan Ismail Petra Airport (SIPA) which is in dire need of expansion as the airport, which is the last stop of the ECRL, has already exceeded its capacity of 1.45 million passengers annual.

The proposed upgrades at the moment for SIPA include an apron expansion, enlargement of runway/taxiways, and the construction of new terminals such as contact pier finger terminals.

MIDF Research is anticipating that these packages will be not be segmented, leaving room for Vivocom to potentially end up taking up the entire package. Property development

Adding to Goh’s opinion, industry analysts are also anticipating the property sector to benefit from the BRI projects due to increasing housing demand as more jobs are created from the economic spur in the areas along the ECRL.

Kuantan in particular is expected to see a housing boom as the city is set to position itself as maritime hub in the east coast of Peninsular Malaysia as the ECRL is actually part of its maritime route that stretches from the Port of Gwadar, Pakistan to supply liquefied natural gas (LNG) to China’s cities in Pearl River Delta, Yellow River Delta and Baohao Rim.

MIDF Research is speculating that the Kuantan Township Kota SAS of which Higher demand for ringgit

Beyond just growing our economy, Goh also anticipates that our ringgit will see more demand due to the encouraged use of local currencies in the BRI instead of major currencies such as the US dollar.

“In doing so, the risks of exchange rate fluctuations and the cost of foreign exchange conversion could be reduced while also promoting the use of RMB and increase other local currency-denominated funding across the region through issuing more local currency than US-denominated bonds,” she explained.

And with higher trade and investment beginning to be conducted among BRI countries and the rest of the world, this will also lead to increased supply and demand for local goods and services.

“This should result in higher demand for local currencies, including the Malaysian ringgit.”