China initiative 'could bridge Asean infrastructure gap'

China's One Belt, One Road initiative could not only boost infrastructure throughout South-east Asia, but also create more widespread benefits across multiple industries, according to participants at an HSBC discussion yesterday.

Mr James Cameron, co-head of infrastructure and real estate at HSBC Asia-Pacific, told the participants that the mobilisation of Chinese capital through the initiative could help "bridge the infrastructure gap" faced by Asean nations.

He noted that China has a record of carrying out infrastructure projects at a fast pace. The country had about 19,000km of high-speed rail as at the end of 2015, for example, the highest among nations.

"There are significant opportunities for China to contribute expertise, not just directly but also with domestic players, in the infrastructure space," said Mr Cameron, referring to firms involved in distributing raw materials or supplying financial services.

Mr Steven Cranwell, head of commercial banking at HSBC Singapore, said Singapore was well-poised to benefit from the initiative as a "treasury hub for a lot of regional and international firms".

The country's status as a regional trade hub also helps it to facilitate the channelling of investment through South-east Asia from European and American firms.

"What we expect to see in the rail opportunities is a flow-on impact," Mr Cranwell added. Firms involved in industries such as logistics, real estate and retail could benefit from business opportunities created by new transport infrastructure.

Mr Tim Evans, head of commercial banking at HSBC Asia-Pacific, added that the One Belt, One Road initiative could have a greater impact on industries involved in infrastructure projects across the region due to the multiplier effect of investment in local economies.

China will host the Belt and Road Forum on International Cooperation on May 14 and 15.

A version of this article appeared in the print edition of The Straits Times on April 27, 2017, with the headline 'China initiative 'could bridge Asean infrastructure gap''. Print Edition | Subscribe