KUALA LUMPUR: Local companies should find opportunities and capitalise on Chinese infrastructure projects that are planned in Malaysia and within the region.
HSBC Bank Malaysia Bhd, in a briefing today, on China’s investment in the Southeast Asian Railway Network (SARN), said local contractors will have a good slice of the pie from the projects.
"Chinese investment is not about the Chinese firms. It is also about the Malaysian companies which are capable of being part of a massive regional infrastructure project," said HSBC Malaysia chief executive officer Mukhtar Hussain.
"In the case of SARN, which is expected to stretch over 3,000km long and will run from Yunnan, China to Singapore. Obviously, Malaysian firms will be needed to help build the portion that will cross through Malaysia because who would know the Malaysian terrains better than Malaysian companies themselves?” he said.
When asked how would the bank benefit from this project, Mukhtar said HSBC is always looking at opportunities to provide project financing, especially for big infrastructures.
"Our portfolio typically consists of big infrastructure projects and we are hoping the firms that we have aligned ourselves with will be selected for some of the works,” said Mukhtar.
“HSBC is a global bank, with presence in China that dates back to over a century ago. With our global network and our existing capabilities in China, we’ll be able to provide the best kind of service to local firms that are looking to be part of this massive project," he added.
Mukhtar noted the scale of the project and the duration would ideally see project funding via Sukuk issuances.
“Given Malaysia's reputation as the world's hub for Islamic finance and sophisticated Sukuk market, we believe Sukuk would be an ideal choice for a project this size,” he said.
With a target completion of 2026, SARN will cut through China, Laos, Cambodia, Thailand, Singapore, Indonesia and Malaysia.
It is also one of the seven transport networks under China's ambitious Belt and Road Initiative which aims to create the “New Silk Road”; a massive vision to better integrate and boost trade between Europe and Asia.