Malaysia and China join forces on billion-dollar rail project

China’s plans to extend the East Coast Rail Link (ECRL) into Thailand are set to transform Southeast Asian trade. Chinese Premier Li Qiang announced the initiative during his visit to Malaysia yesterday.

The US$10 billion (approximately 366 billion baht) ECRL, a key project of China’s Belt and Road Initiative, aims to connect Malaysia’s east and west coasts by 2026. Initially proposed in 2017, the 665-kilometre rail line has seen numerous revisions. It is being constructed by China Communications Construction Co Ltd’s Malaysian unit.

Li’s visit, his first to Malaysia as premier, signifies Beijing’s intent to deepen ties with a country balancing relations between China and the US. Meeting with Malaysian Prime Minister Anwar Ibrahim in Putrajaya, Li witnessed the signing of several significant deals, including a landmark agreement to export fresh durians from Malaysia to China.

Previously, Malaysia could only export durian products and frozen durians. This deal places Malaysia alongside Thailand and Vietnam in supplying the lucrative Chinese market with the fruit king.

Malaysia and China have agreed on an economic and trade cooperation plan extending to 2028. This includes exploring more visa exemptions to enhance the mutual visa-free entry policy.

The leaders also addressed the South China Sea disputes, advocating for direct discussions between China and ASEAN countries. This region is claimed by multiple countries, including Malaysia, Vietnam, the Philippines, Brunei, and Taiwan, with frequent tensions over territorial rights.

Li’s visit is pivotal as Malaysia seeks to attract investments from China and the US while navigating geopolitical tensions. Ibrahim, emphasising Malaysia’s independent stance, recently committed US$5.3 billion to boost its semiconductor industry amidst the US-China tech rivalry.

“Malaysia maintains a strong and fruitful relationship with China and the United States.”

Celebrating 50 years of diplomatic ties, China remains Malaysia’s top trading partner, with bilateral trade hitting US$98.9 billion. Recent tech investments from ByteDance, Google, and Microsoft underline Malaysia’s strategic importance in the region, reported Bangkok Post.