PETALING JAYA: In a bid to deepen economic ties between Malaysia and China, both countries should prioritise Digital Economy Investment, Green Development Investment and Electric Vehicle (EV) Car Development, says Tan Sri Soh Tian Lai.
The Federation of Malaysian Manufacturers (FMM) president said that as a trading nation, Malaysia aims to foster a balanced and inclusive economy with all its trading and foreign direct investment (FDI) partners.
China has always been seen as a strategic partner for Malaysia’s sustainable and inclusive growth.
He mentioned that Malaysia, with its political stability, pool of quality talent, knowledgeable workers, well-developed infrastructure, high investment incentives, no language barriers, and free trade agreements (FTAs) including the Asean China Free Trade Agreement (ACFTA) and the Regional Comprehensive Economic Partnership (RCEP), is well-positioned to be a preferred investment destination for Chinese companies looking to establish operational headquarters, financial establishments, and manufacturing facilities.
“This is evident as Malaysia recorded approved investments totalling US$59.9bil (RM240.85bil) in 2022 across the manufacturing, services and primary sectors, with the largest foreign direct investments coming from China amounting to US$12.5bil (RM52.25bil).”
He mentioned that the Malaysian manufacturing sector could leverage the know-how and technological advancements of China to bolster their positions in regional and global value chains.
With China’s Electric Vehicle (EV) market on the brink of significant growth, driven by clean energy initiatives and strong government support, and an estimated revenue of US$292.1bil (RM1.2 trillion) projected for 2023, the market is expected to see a compound annual growth rate (CAGR) of 6.38% from 2023 to 2028.
Soh highlighted that Malaysia has much to gain from China in expanding Malaysia’s EV market, not only through the transfer of know-how in automation and technological advancements but also by focusing on creating highly skilled jobs as the country progresses towards more value-added activities.
“To achieve this, FMM proposes that China consider establishing training or educational centres focusing on electric vehicles (EV) to introduce China’s EV technology in Malaysia and cultivate the skillsets necessary to support technological advancement, innovation and R&D activities.
“China’s growth in the EV sector goes beyond autonomous vehicles. China is also leading in the construction of charging stations and plans to build enough stations for 20 million electric vehicles by 2025 for public use in China.
“We hope to attract investments from China for EV charging stations to assist Malaysia in developing its EV charging infrastructure,” he added.
Additionally, over the past decade, China has established itself as the world’s top producer and consumer of solar photovoltaic (PV) products, accounting for 80% of critical manufacturing stages and 95% of critical minerals in the PV manufacturing value chain.
“Since solar panels typically last 25 to 30 years, China has started to make progress in establishing infrastructure for recycling solar panels. Therefore, we welcome further collaboration between businesses in the solar panel recycling sector as we move towards sustainable practices,” added Soh.
In a different vein, Soh pointed out that with an annual output of 33 million tonnes, China has emerged as the world’s largest hydrogen producer.
He said with the significance of green hydrogen in China’s journey towards achieving carbon neutrality by 2060, Malaysia has witnessed technological advancements and large-scale projects led by local governments and companies in China, paving the way for an escalating green hydrogen industry.
“Thus, we believe there is potential for collaboration between companies from both countries in developing green hydrogen as a clean energy source for transportation, electricity, and other applications, particularly since Malaysia boasts abundant renewable energy resources,” he added.
