MCKIP will put Kuantan on Asian investment map

2/2/2013 — New Straits Times

THE mammoth Malaysia-China Kuantan Industrial Park (MCKIP) in Gebeng here will help boost the country’s economic growth, generate thousands of jobs and create downstream opportunities for the locals.

Poised to transform Malaysia into a regional business hub, MCKIP is fast gaining popularity among investors from big corporations in Asia.
The 607ha industrial park site, which is near the South China Sea, facing Kuantan Port, will offer a lot of opportunities for large and medium-sized industries, apart from a dedicated area for small and medium enterprises (SMEs).
Situated only 25km from Kuantan town, MCKIP is the first bilateral project in Malaysia to be accorded a national-level status. It is expected to attract RM7.5 billion investments from local and international investors and create 5,500 job opportunities by 2020.
Numerous target industries have been identified for MCKIP inclu-ding the manufacturing of equipment for plastics and metal, automotive components, fibre cement board, stainless steel products, food processing, carbon fibre, electric and electronics products, information and communications technology and consumer products.
The park, which will be officially launched by Prime Minister Datuk Seri Najib Razak next Tuesday, will be developed in phases.
The project will help turn Kuantan into a strategic gateway to Asean and the Asia-Pacific region, which has a population of four billion and a combined gross domestic product of US$17 trillion (RM52.7 trillion).
Blessed with abundant natural resources and a modern world-class port, which is supported by good infrastructure and attractive fiscal and non-fiscal incentives, MCKIP will serve as the ideal gateway for investors around the globe who are keen to tap into the Asean market.
The MCKIP, the first industrial park in Malaysia to be jointly developed by Malaysia and China, is a government-to-government initiative to reciprocate the China-Malaysia Qinzhou Industrial Park launched by Najib on April 1 last year.
East Coast Economic Region Development Council (ECERDC) chief executive officer Datuk Jebasingam Issac John said the entire project was due for completion by 2020 and would not only target investors in Malaysia and China, but also worldwide.
“MCKIP will also provide a significant boost to the ECER Special Economic Zone (ECER SEZ), which will be the catalyst of economic growth in the region, and at the same time, create vast entrepreneurship opportunities for local businessmen.
“Kuantan is the best location for MCKIP as it is located in the ECER SEZ and is well connected by highways to the leading airports and seaports in the country. The Kuantan Port, which is currently being transformed into a deepwater port, will serve as the regional hub and collection centre for containers in Southeast Asia,” he said.
Jebasingam said Kuantan was chosen for the industrial park as both Kuantan and Qinzhou have well-developed sea ports, providing the shortest link across the South China Sea as the journey by sea takes just three days and this offers an excellent opportunity for closer co-operation.
There are also synergies between Kuantan Port and Qinzhou Port as the rich iron ore supply in the country can be exported to China to support the ship, automotive and parts industries in Qinzhou.
Through MCKIP, the Greater Kuantan that stretches from Pekan to southern Terengganu, can also tap into the China’s province as an economic powerhouse as the country has been Malaysia’s biggest trading partner for three consecutive years, contributing 13.2 per cent of the total value of Malaysian’s world trade.
To be achieved in 2020, Greater Kuantan will make the state capital the most important city in the east coast and will be the best city to live in due to the high quality of life.
Greater Kuantan residents will have access to good infrastructure, clean air, affordable housing, meaningful employment and greener spaces and parks.
Last year, the Prime Minister’s Special Envoy to China, Tan Sri Ong Ka Ting, announced that they were in the midst of setting up a joint venture (JV) company, to be 51 per cent owned by Malaysians and 49 per cent by China investors, to manage and develop the industrial park.
He said Malaysia would be spearheaded by two strong and well-branded conglomerates – Rimbunan Hijau Group and SP Setia Bhd – along with the Pahang State Development Corp, while four China firms have agreed to be part of the JV, namely Guangxi Beibu Gulf International Port Group, Zhang Jiao Property Co, China Harbour Engineering Co Ltd and Qinzhou Investment Arm.
The Malaysian consortium has sorted out its equity ratio with SP Setia taking 40 per cent, and Rimbunan Hijau and the Pahang state government holding 30 per cent each, respectively, while the Chinese consortium is in the final stages of finalising its partners.
Jebasingam said with the strong support from the governments and entrepreneurs of both countries, the establishment of the two sister industrial parks would be smooth and successful.
“All participating entrepreneurs and government agencies are attracted by these joint-venture projects not only for their huge potential but also as an effort to enhance sustainable efforts to deepen and broaden economic co-operation and diplomatic ties between both countries.
The ECER already has a proven track record in attracting Chinese investors. In 2011, Eastern Steel Sdn Bhd, a joint venture between China Shougang Group and Malaysia’s Hiap Teck Venture Bhd, announced its commitment to invest RM1.8 billion to build an integrated steel mill in the Kemaman Heavy Industrial Park in Terengganu.