The ASEAN Connectivity Master Plan And
The Rapid Rise Of Malaysian Infrastructure
Ranked as the seventh largest economy in the world with a combined GDP of US$2.8 trillion, ASEAN is on its way to becoming a powerhouse in the global market. With eyes set on becoming top three by 2030, the Southeast Asian region is looking to strengthen their foothold through large-scale infrastructure-backed growth.
Regional integration efforts spearheaded in 2007 have since doubled ASEAN’s shared GDP. And to further bolster this colossal growth, a renewed ASEAN Connectivity master plan was commenced in 2015.
The ASEAN Connectivity master plan aims to develop a seamless and comprehensively connected region by 2025 through decisive collaboration between member states. The 5 key tenants of this road map all point towards the ambition of becoming a sizeable economy that can comfortably compete with larger, more mature markets.
To achieve these goals, the bloc has outlined plans to build new infrastructure and cultivate seamless logistics with the vision of bringing together a population of 620 million people into the folds of a thriving economic hub.
This will mean the rapid development of new ports, roads, railways and aviation infrastructures in the region’s 10 nations, all in the name of growth and connectivity.
Each member of ASEAN will undoubtedly benefit from this ambitious collaboration, but none more than Malaysia, one of the associations founding members.
Malaysia, the tropical haven of 32 million people located at the heart of Southeast Asia, is expected to reap immense benefit from this infrastructure-backed growth.
With plans on becoming the regional hub for international trade as stated in the government’s 11th Malaysia Plan, the nation is perfectly primed for this exact endeavor.
The opportunities in infrastructure are extensive and can already be seen making major headway in the country, with a planned infrastructure spending of US$85bil for the 2016-2020 period. Coupled with China’s Belt and Road Initiative (BRI), a gargantuan trillion-dollar development strategy proposed by the republic, the potential of infrastructure development in Malaysia seem endless.
Malaysia is strategically located along the Straits of Malacca, one of the busiest trade routes in the world. This factor enhances Malaysia’s already prominent status in international trade, making them a valuable connector for China’s broader infrastructure plans.
The nation is now a key component of the high-speed rail network that will run from Southern China through Laos, to Thailand’s industrial east coast, a port in Vietnam, and then on to Malaysia and Singapore.
Aviation infrastructures are also being planned in the form of KLIA Aeropolis, a 24,700-acre development led by airport operator Malaysia Airports Holdings Bhd (MAHB). Alibaba, the world’s largest e-commerce company has already made plans to set up their regional distribution hub within this enormous project.
ASEAN’s Connectivity master plan creates a massive opportunity for the repair, expansion and development of the region’s infrastructure. Combined with the economic potential presented by China’s BRI, this could be the biggest opportunity to stimulate international trade since the creation of the World Trade Organization 20 years ago.
Malaysia is perfectly primed to reap the benefits of these massive endeavors. And although many challenges lie ahead, the key components, from regional regulatory efficiencies to broader international plans, have all been lined up to ensure that this blossoming nation strategically located at the heart of Southeast Asia will become a boon of prosperity in the decades to come.