A new report by Maybank says that Chinese BRI investments in Southeast Asia are showing signs of recovery as the trade war between the US and China is pushing Chinese companies to relocate manufacturing facilities to the region to escape punitive US tariffs, said Caixin.
Chinese investment and construction contracts in Southeast Asia nearly doubled to $11 billion in the first half of this year, from $5.6 billion in the second half of last year, when it had slowed sharply on the back of the trade war and a “debt trap” backlash from developing countries including Sri Lanka, Pakistan and Malaysia, according to the report by Maybank.
The new Belt and Road contracts for the past six months are largely in Indonesia, Cambodia, Singapore and Vietnam, and primarily for transport and energy projects. In contrast, Malaysia, which used to attract the largest Belt and Road flows, has not seen a recovery. Still, it remains the largest recipient of cumulative Belt and Road contracts since 2013, followed by Indonesia and Singapore.
The report noted that Malaysia’s new government recently renegotiated and revived the East Coast Rail Link and Bandar Malaysia projects, which may restart investment flows.