China tycoon planning RM10b investment here unperturbed by Dr M’s stance

Yan is the founder of China's Pacific Construction Group Limited (CPCG), a Fortune 500 firm. ― Picture courtesy of CPCG
Yan is the founder of China's Pacific Construction Group Limited (CPCG), a Fortune 500 firm. ― Picture courtesy of CPCG

KUALA LUMPUR, Oct 13 ― Chinese construction tycoon Yan Jie-he has voiced his understanding and acceptance of Prime Minister Tun Dr Mahathir Mohamad's previous remarks on projects involving China's state-owned companies (SOEs).

Yan, who is planning to invest RM10 billion in Malaysia over the next 10 years, reportedly said he grasped the motivation behind Dr Mahathir's comments and the government decisions on projects involving Chinese firms such as the Forest City project in Johor.

“I am aware of it. I think it is normal for the government to do this. If I am Malaysian, I would not want my country to become a colony.

“I would be concerned about national security nothing is more important than national security,” he was quoted saying in an interview published by finance weekly The Edge.

Yan is the founder of China's Pacific Construction Group Limited (CPCG), a Fortune 500 firm. CPCG has a Malaysian subsidiary named CPCI Holdings Sdn Bhd.

According to The Edge, Yan's CPCG is the largest privately-held construction firm in China and was on the 96th spot in Fortune's Global 500 list for 2018. CPCG's annual revenue last year is at RM319 billion, which outstrips Malaysia's sole Fortune Global 500 company Petronas which last year had RM223.6 billion in revenue.

Yan similarly did not find it unusual for the Malaysian government to interfere in mega projects, including the multi-billion East Coast Rail Link (ECRL) project's suspension and scrapping of a contract for the Mass Rapid Transit Line 2 (MRT2) project's underground work.

“Government interference is necessary when there are issues that have been identified. I have heard about these matters, and I thought [the government's actions] were nothing unusual.

“In fact, I am not at all shocked. It is normal for the government of the day to have such concerns or make such decisions, especially given Malaysia's current national debt situation,” he was also quoted saying.

Yan, who met Dr Mahathir during the latter's official visit to China in August, reportedly said the re-tendering process for the MRT2 underground work portion would likely see many companies stepping forward.

No corruption

Yan said he would not engage in corrupt practices in his projects in Malaysia, adding that his business would not be built by depending on political patrons as it would result in “over-reliance”.

“To me, my aim is to participate in the free market here, not indulge in bureaucratic corruption we have seen in the past that has been detrimental to the country's economy.

“I am saying that should Malaysia decide on CPCG as a partner, I do not ask for benefits. My conscience is clear. I am clean, in the sense that I have never budgeted for corruption in my projects. That is how I keep my costs low,” he said in the same interview published by The Edge.

Yan's Malaysian subsidiary CPCI as of now is involved in only a RM200 million project for the construction of housing for Felda Engineering Ventures Plantations Sdn Bhd-owned oil palm plantations in Sahabat, Sabah.

Yan said CPCI had won the contract through open tender, and that his group would also only bid for projects in open tenders instead of going through direct negotiations.

Yan also said his construction group is not a state-owned enterprises, and would be using local materials and also employing locals, The Edge reported.

Earlier this week, Yan had said plans to make the group's CPCI a regional centre was tied to Malaysia's strong fundamentals ― namely excellent infrastructure, a robust ecosystem and big pool of trilingual talents.

Yan said this made Kuala Lumpur a strategic place to launch his group's expansion into Asia Pacific, adding that he plans to employ 150 highly skilled professionals in the next five years with at least half to be Malaysians.

These trilingual local talents would be invaluable for the group's global projects, he had said.

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