No negative impact from UK vote
Britain is still a hugely important economy in Europe, says Liew
KUALA LUMPUR : Malaysian property firms with developments in the United Kingdom say that their ventures will not be negatively impacted as a result of the June 23 referendum whereby British citizens voted to exit the European Union.
Eco World International Bhd executive vice-chairman Tan Sri Liew Kee Sin said that while the decisive win by the Brexit camp was unexpected, the group is optimistic that the results hold a silver lining going forward.
“Now that the results of the EU referendum are known, the long uncertainty which has caused many investors to hold back on decision making is finally over. Britain is still a hugely important economy in Europe with highly principled, professional and competent leaders,” he said in a statement.
Liew added that he has every confidence that the British government will do their utmost to take proactive measures to assuage post-Brexit concerns and move the UK forward on every front.
London’s position as a prime destination for global real estate investment is unlikely to change given that many of the fundamental drivers of demand are still intact. Chief among them are transparency of laws, ses- urity and ease of ownership, and shortage of supply, among others, Liew noted.
EWI, which is en route to listing on Bursa Malaysia, has three projects in London, namely the London City Island Phase 2 in East London, Embassy Gardens in Nine Elms, and Wardian London facing the Canary Wharf. All three were launched last year.
“For EWI specifically, it should be noted that through our proposed initial public offering we will be raising equity in ringgit. Now that the sterling has dropped it means that the cost we have to inject into the UK to pay for the developments there will be lower,” he points out.
Meanwhile, in a statement reacting to the results of the UK referendum, Sime Darby Bhd, which is undertaking the Battersea Power Station project has reiterated its long term commitment to the venture.
“The results of the referendum is not expected to impact the viability of the project.
“We are confident the iconic development will continue to generate interest in the longer term and that London will continue to remain a key investment destination and financial centre,” it said.
Sime Darby has a 40% stake in Battersea. The other joint venture partners are SP Setia Bhd and the Employees Provident Fund with 40% and 20% respectively.
A research note by MIDF Research said global capital markets may take some time to adjust to the Brexit vote which could have adverse repercussions on businesses.
Its group managing director Datuk Mohd Najib Abdullah said that as a result of Brexit, the world is moving into a period of elevated uncertainty, with risk appetite plunging in a flight to safety and security.
As the UK is an important market for Malaysian exporters and an important source of foreign direct investments, any economic malaise from Europe will inevitably affect Malaysia in the longer term, both directly and indirectly, MIDF said.