CLOSER ECONOMIC TIES
Economists expect the economic relationship to further improve over years.
"Malaysia is well-positioned to benefit from the higher connectivity due to its central location for sea, air and land transportation, favorable policy environment and strong capacity to absorb foreign investment inflows," Sunway University Economics professor Yeah Kim Leng told Xinhua.
While there have been concerns over low spillover effects to the economy, Yeah opined that the positive benefits of Chinese investment for Malaysian economy will include expansion of production, export and infrastructure capacity.
Besides, Chinese investment also offer more diversified sources of inward foreign direct investment (FDI), and increased access to Chinese markets for Malaysian manufacturers and service providers as the economic and business linkages expand over time, said Yeah.
"Given that both the Association of Southeast Asian Nations (ASEAN) and China are expected to continue to grow at a healthy pace, there are certainly further areas for growth," said Edward Lee, the chief economist for Southeast Asia at Standard Chartered.
"Consumer markets in both economic areas will grow larger and provide final demand for companies in both economies," he told Xinhua.
As Chinese companies diversify their assets, he also expects the increasing outward direct investments into the region.
"There has been an increase in investments from China into the region, more so in real estate and construction sectors. But as China develops further, there may be increasing investments in other areas," Lee said.
