KUALA LUMPUR, Oct 15 ― A thorough assessment of investments from China, especially from the Belt and Road Initiative (BRI), is seen as important for Malaysia, says the Khazanah Research Institute’s State of Household 2018: Different Realities Report.
It said Malaysia would undoubtedly stand to gain from maintaining good relations with China, but it is also important to assess the investments to ensure they result in beneficial outcomes for the country.
“In further relations with China, it is important to ensure that we continue to receive mutually equitable trade deals and be fully aware of the potential socio and geo-political repercussions of over-reliance on any country, be it China or any other major powers in the region or the world,” it said.
The report said the emergence of China as a new global superpower would have major implications on the future of Malaysia and the region.
It said the Chinese BRI had potential to reshape the global trading order by allowing many countries, including Malaysia, to follow an alternate economic development path.
“It, however, is fraught with potentially insidious foreign policy agendas. By potentially overwhelming countries with foreign direct investments that must be repaid, this strategy has the danger of burdening countries into debt-ridden relations with China.
“These debt-traps give China significant future geo-political leverage in the region, as seen in the case of Sri Lanka and their loss of sovereignty over the Port of Hambantota,” it added.
Besides changes in the global economic landscape, technical disruption that has radically transformed how we live, also poses a challenge to Malaysia’s economy and the well-being of the people going forward.
The report said Malaysia needs to be aware of automation given its tremendous potential to improve productivity in the country.
“Malaysia also needs to be aware and adapt towards the changing circumstances and nature of any industries in the future.
“The potential disruption caused by revolutionary technological advances could be severe if handled poorly.
“Mass unemployment with a severely crippled economic foundation could be averted, if the nation and its people stay ahead of the game, and adapt to the changes of the new economic order of the era,” it added.
The report was launched by Khazanah Nasional Bhd Managing Director Datuk Shahril Ridza Ridzuan here today. ― Bernama