Recommend Us | About Us | Back to

News | Financial Calculator | Home Financing | Archived News |


  Welcome to Bernama Banking & Finance Special Page     
Belt And Road Initiative To Give Important Financial Implications For Investors -- HSBC
Last update: 11/07/2017

KUALA LUMPUR, July 11 (Bernama) --†China's Belt and Road Initiative, which focuses†on physical infrastructures like†railway lines, ports and highways, has important financial implications for investors in Malaysia,†said HSBC Bank (M) Bhd.

In †a statement today, the bank said, the†initiative, which was announced in 2013,†would†galvanise infrastructure constructions as far afield as South-East Asia,†West Asia, Africa and Europe.

"There are already many significant Chinese investments in major Malaysian†infrastructure projects.

"One such example is†the†strategic partnership between Melaka and China's Guangdong province, which aimed†to promote various projects that would†help develop the state†as a strategic port and†hub along the Belt and Road route,"†it said.

According to Asian Development Bank estimates, about RM112 trillion would be needed for†infrastructure development in Asia between 2016 and 2030, as developing nations aimed to raise productivity and deal with†growing urbanisation and the impact of climate change, the bank said.

HSBC†Bank said†sovereign wealth funds had been deploying more of their assets to global infrastructure investments,†especially in Asia.

"The†steady return potential of infrastructure investment was also†a good fit for Asia's middle class investors.†The expected growth in capital-raising activity is also good news for the development of some of the†smaller markets along the Belt and Road route, as†many emerging local-currency bond markets have grown rapidly†in recent years,"†it said.

It said†the Malaysian bond and sukuk market also continued†to play a major role in†supporting economic growth by financing†business expansions and infrastructure developments.

It said†Malaysian bonds had †seen strong demand from local and foreign investors who had†been searching for higher-yielding assets after building up significant cash positions over time.

"Foreign†interest had resulted in†RM6.8 billion and RM10.1 billion of inflows to domestic debt markets this year in April and May respectively,"†it said.

Meanwhile,†HSBC†Malaysia Chief Executive Officer, Mukhtar†Hussain,†said it†would require all available sources of capital of the private and public sectors to finance†the†colossal need for transport, telecommunications†and energy infrastructure.

"But it will†also generate a broad spectrum of opportunities for local and international investors†and stimulate†capital markets development in many Asian markets, where bank lending still tends to dominate financing.

"Infrastructure projects, by their very nature, are large, complex, often multi-decade ventures that can involve†different kinds of funding over their lifetime.

"So the Belt and Road fund-raising will need to come†from the full range of sources - including bridge financing from banks, equity capital from governments, funds†and public and private equity markets, and long-term bond issuance from private and public†sector institutions,"†he said.

He said infrastructure projects and the stable, long-term returns they tended to provide also attracted investors looking to diversify their holdings.

Mukhtar†said†that increased capital-market activity could†also prompt more cross-border regulatory coordination among markets in South-East Asia or Central Asia, with†more cohesion†in areas like documentation, taxation, foreign exchange regulation and credit ratings.†



GST ends on AIBIM Bank services & products
RHB Islamic Bank CEO is new AIBIM President

Islamic Financial Institutions should adopt IIFM standards

Zero GST for life, general insurance and Takaful products
Takaful Malaysia converts composite licence to single licences

Taiwan's Shinkong Insurance company gets excellent ratings

US 3.9960/4.0000
S'pore 2.9561/9592
100 Yen 3.6393/6440
Sterling 5.3011/3068
Euro 4.6489/6544
Source: Bank Negara Malaysia

Starting April the banks have imposed a 50 sen processing fee on top of the 15 sen stamp duty on each cheque. The fee also applies to those applying for a Bankerís Cheque, Bank Draft and Cashierís Order. Do you think this additional charge is justified?

  Main | News | Insurance

© 2018 BERNAMA. All Rights Reserved. Disclaimer | Privacy Policy| Security Policy
This material may not be published, broadcast, rewritten or redistributed in any form except with the prior written permission of BERNAMA.
Best viewed in Firefox 8.0 & Internet Explorer 8.0 with 1024 x 768 resolution