Despite rocky relations, Chinese investors are seeking their chances with investments and M&A in ASEAN, the world’s sixth-largest economy, writes Alainna Wrigley
Following the April summit of ASEAN nations, ASEAN leaders issued an unprecedented closing statement. Land reclamation, they wrote, “eroded trust and confidence” in the South China Sea, an area with multiple territorial disputes between China, ASEAN members and other jurisdictions. China has maintained that these disputes are bilateral, and should not affect relations with the region as a whole.
Chinese investors seem to agree. Despite these tensions, Chinese investors have remained optimistic about participating in ASEAN countries. Investment in ASEAN economies has continued to increase. Since 2009, China has been ASEAN’s largest trading partner, and it is moving to become one the region’s top investors. According to data released by the Ministry of Commerce, direct investment totalled US$1.73 billion in the first quarter of 2015, and investment in ASEAN countries in January to July increased by 57.6% over the previous year.
“One can see the involvement of Chinese companies, as both suppliers of equipment and raw materials and participating in constructing and operating major infrastructure projects”, says Colin Ong, the managing partner of Dr Colin Ong Legal Services.
China and ASEAN states have introduced a number of policies to facilitate investment and cooperation between the economies in recent years.