Posts tagged China
Aircraft maintenance, repair and overhaul (MRO) is earmarked as a Malaysian growth industry and has full government support under the Economic Transformation Programme (ETP). To achieve its stated vision of becoming RM193.3 billion (US$65 billion) industry by 2020 and making Malaysia a regional MRO hub, however, the industry needs to make big leaps in policy & procedure improvement, availability of skills, and build a spare parts infrastructure.
MAS Aerospace Engineering (MAE), a division of national carrier Malaysia Airlines (MAS), is the company best positioned to achieve the goal and seems to have a good understanding of improvement points. The company made RM2 billion ($663.8 million) in revenue in 2010, 40% from its parent company and 60% through third-party and joint venture services. It is the third-largest airframe MRO company in the world, and says 75% of the world’s top airlines are on its client list.
Business TImes reports MAE is currently in talks with potential joint venture partners in China, and recently opened a facility with partner GMR Group in Hyderabad, India, its first outside Malaysia. Asia-Pacific, China and India accounted for 23% of the global MRO market, or RM29.6 billion ($9.8 billion), the company said.
On the homefront, MAE said that to properly develop MRO leadership, Malaysia needed more licensed aviation engineers and more training centers to produce the engineering skills required. There is also a feeling among the country’s top aviation schools that aviation engineering isn’t being promoted effectively enough as a vocation, and that the industry needed greater public awareness of its economic importance before it could develop and keep up with increasing speed and complexity.
source & article: Business Times
Chinese Premier Wen Jiabao brought great news and economic rewards for Indonesia on his two-day official visit, along with a delegation representing 150 Chinese companies. The results were offers of multibillion dollar loans, US$10 billion worth of business contracts, $8 billion worth of financing contracts for companies willing to invest in Indonesia’s major infrastructure projects, and a $1 billion ‘preferential buyer’s credit’ for Indonesia, reportedly the largest China has ever awarded a foreign country.
The $8 billion in financing contracts will come mainly from the China Investment Corp ($4 billion), the Export-Import Bank of China and the Commercial Bank of China. Bilateral trade between the two countries reached $42.7 billion last year, a 50.6% increase on the previous year, with Wen saying it could feasibly reach $80 billion annually by 2015.
Wen’s visit was the first official visit to Indonesia by a Chinese Premier in a decade, and hinted at a much closer economic and strategic relationship between the two countries. He announced the plans at a joint media conference with President Susilo Bambang Yudhoyono. They also announced new regular top-level meetings between leaders and dialogs at vice-prime-ministerial level, plus new programs to cooperate on maritime security, resources exploitation and disaster response.
China took particular interest in Indonesia’s large-scale ‘six economic corridors’ development strategy and the many opportunities for investment and progress it produced. The Indonesian Ambassador to China, Imron Cotan, seemed particularly pleased at the thought of enhanced relations, saying that China was willing to share its technology and put no preconditions on investment, and understood that Indonesia’s prosperity and regional stability would be beneficial to China’s own progress.
source & article: China Daily
Officials from the Philippines have visited China to drum up investment and support for new infrastructure projects, which the new Aquino administration hopes will spur growth and enable the country to get back some of its mojo for economic development. Chinese state-owned enterprises and private firms have expressed interest in playing a part, with Philippines Finance Secretary Cesar Purisima reporting the Chinese consider his country ‘an important neighbor’. They also appeared willing to fund grants and interest-free loans in order to fund feasibility studies into priority projects.
Although the visit was a general mission to gauge interest in closer economic ties, officials will now return to China with a specific list of projects and priorities. Public-private partnerships are the main attractions the government has planned for companies investing in the Philippines, with a focus on infrastructure development.
According to the Philippine Daily Inquirer, potential partnerships include: the MRT/LRT expansion project, MRT Line 2 East extension, Panglao Airport, Laguindingan Airport operation and maintenance, Puerto Princesa Airport, Daraga International Airport, Kalibo Airport, Naia Terminal 3 upgrade and full operationalization, CALA Expressway (Manila side), Naia Expressway Phase II, Central Luzon Expressway Phase I, and supply of treated bulk water for Metro Manila.
Australia’s international trade development agency Austrade is encouraging local firms to get involved in a series of major transport proposals across Asia. The region’s emerging big hitters have realized the importance of solid infrastructure to support their booming economies and logistical needs, especially airport expansion and roadway construction.
Among the projects Austrade has flagged for attention are Indonesia’s US$255 million Ngurah Rai Denpasar Bali International Airport expansion and accompanying expressway, due to open before the 2013 APEC Summit, new expressway and metro line projects in Vietnam, and development of numerous transport plans and policies for the Philippines. There’s also the $2.3 billion Phase 2 of Thailand’s Suvarnabhumi Airport improvement involving a third runway and new passenger terminals. As well as the Southeast Asian projects, giants China and India are also active in the infrastructure boom, with Beijing planning a second airport and India investigating dedicated freight rail corridors (DFCs) and over 70,000km of proposed new roadways.
Austrade’s Senior Export Adviser Stan Roche said Australian companies could offer their expertise in several areas, not only in design and engineering but also in finance advisory and expertise in dealing with public-private partnerships (PPP). There were also other opportunities in related fields like security systems and technology.
Our favorite stories from the mass transit sector in the past week: Malaysia Steel Works (KL) Bhd, or Masteel, and KUB Malaysia Bhd are coming together to build a new intercity transit system for Iskandar Malaysia in Johor, while a Chinese region is planning a rail link from Nanning to Singapore through Vietnam, at least part of which is high-speed.
Masteel expects its project will be completed by 2013. The RM1.23 billion (US$ 401million), 100km intercity system will be the first of its kind in Johor and run on existing rail. It will cover 25 regional centers and overseers hope to connect it eventually with the MRT line from Singapore. About 70% of the cost will come from the public-private partnership scheme and the companies are in negotiations with the Malaysian government’s Economic Planning Unit over a 25 year concession deal.
Meanwhile, China’s autonomous southern region of Guangxi Zhuang has plans to increase trade with ASEAN over the next five years with a high speed rail link between the cities of Nanning and Pinxiang near the Vietnamese border. Details are scant at the moment but it seems the $3.05 billion project would connect to a 5,000 rail link passing along the ‘Nanning-Singapore Economic Corridor’ through Vietnam (and presumably other countries along the way).
Efforts in China to cool the local property market are serving up bargains to Singapore investors, according to TodayOnline. Increased interest rates and suspension of mortgages on third homes, plus rumors of new property taxes, have stalled or even lowered prices. Prime sites in the most attractive Chinese cities are now available to foreign investors who might otherwise have stayed out.
Singaporean companies like CapitaMalls Asia (CMA) and City Developments (CDL) have seized the chance. CMA bought a 66% stake in a S$747.2 million (US$578.5 million), 24,000 sq m Shanghai retail and office complex in November, then followed up in December with its announcement of a joint venture with Chinese developer CapitaLand China (and others) to build Shanghai’s second Raffles City complex for S$1.6 billion (US$1.24 billion). CMA now has S$7.3 billion invested in China with plans for a further S$2 billion, and a goal of 100 shopping malls over the next five years.
CDL is focusing on the residential market through its subsidiary CDL China, with a $45.7 million, 27,000 sq m residential complex in Chongqing. The company has big plans for China, and has identified 12 cities as targets for expansion.
source & article: TodayOnline
Singapore is looking to build trade ties with central China, opening a branch of its trade-focused International Enterprise Singapore in Wuhan, capital city of Hubei province. The Singapore Economic Development Board will occupy the same space.
Organizers hope the new center will provide mutual benefits to each country: Singapore businesses can learn more about the central Chinese market and local Chinese companies can gain expertise in dealing with international customers. As of 2009, there had been 287 cumulative Singaporean projects in Hubei province and current direct investment stood at US$138 million.
The new branch is IE Singapore’s tenth Overseas Center in China; there are others in Beijing, Chongqing, Dalian, Shanghai, Chengdu, Qingdao, Hong Kong and Ghangzhou. As well as Hubei, the new center will also look at trade and investment issues in Hunan and Jiangxi provinces.
source & article: Xinhua/People’s Daily
An article in today’s Sydney Morning Herald examines the impact of an integrated ASEAN economy, mostly from an Australian and trade perspective. Were the dreams of ASEAN’s planners to come true by 2015 or sometime soon after, it would have a dramatic effect on other regional economies as Southeast Asia build massive transportation infrastructures, harmonized customs and immigration regulations, and opened up the energy and telecommunications markets:
It is the kind of seismic change in regional economic development that, if implemented, will force all sorts of changes in local laws, regulations and procedures.
Moves towards an EU-like integration are driven and influenced by the rapid growth of China and India, increasing competition as well as new investment opportunities in both directions. Smaller countries are finding it harder to get headlines and export industries in Australia may also need a cultural adjustment to transact more effectively with the region.
source & article: Sydney Morning Herald
Malaysia’s Terangganu State says the east coast is ripe for investment in Eco and Sports Tourism. Terangganu’s Executive Councillor Toh Chin Yaw said the state, along with fellow east-coasters Kelantan and Pahang, offered a vast range of natural attractions like unspoiled islands, beaches and rainforests along with man-made facilities like Terangganu’s endurance sports park.
Terangganu, famous for agriculture and more recently oil and gas development, is looking to develop other aspects of its economy and has begun to host international sports events to showcase its other attractions, especially in the rapidly growing eco-tourism industry.
Toh made his comments while on an investment mission to Xianen, representing Terengganu in the East Coast Economic Region Development Council at the 14th China International Fair for Investment and Trade (CIFIT 2010). He said the response from Chinese investors and government officials was positive.
source & article: Bernama
Bali accounts for 35% of Indonesia’s tourist traffic and up to 45% of its foreign currency exchange, according to news agency Antara.
Tourists contributed Rp34 trillion (US$3.7bn) to Indonesia’s economy (time period not specified) in total. Other regions such as South Sulawesi, North Sumatra, Central Sulawesi and West Papua have noticed Bali’s success and are busy forming promotional alliances in the hope of attracting more foreign visitors.
Bali’s tourism service admits there are still improvements to be made in facilities, infrastructure and security, but visitor numbers have increased every year for the past five years, except 2006. Two million visitors arrived there from overseas in 2009, and 2010′s figures already show an 18% improvement on that figure.
Nearby Australia is still the number one country for foreign arrivals but in the past year, China replaced Japan as the number two source. South Koreans and Malaysians rounded out the top five. Bali is responding to the big increase in Chinese tourists and there are now nearly 800 Mandarin-speaking tour guides in the province, the Tourism Service said.
(I’ve said it before and I’ll say it again: Indonesia has a beautiful setting and is sitting on a potential tourism goldmine, so long as it develops the right infrastructure and promotes itself effectively.)