Will China use Melaka Gateway for naval purposes?

Analysts says China is investing in the Melaka Gateway project not just for economic returns but to have a naval foothold in the strategic Straits of Melaka.

KUALA LUMPUR: China’s involvement in the massive Melaka Gateway project is not all about economic gains. It is a move to strengthen its maritime footprint in the region, says a report.

USA Today quoted Jonathan Hillman of the Center for Strategic and International Studies in Washington, DC as saying: “There’s something powerful about China putting forward this hugely ambitious economic initiative.”

The report noted that China was Malaysia’s largest trading partner and its number one foreign investor.

The RM43 billion Melaka Gateway project, seen as an attempt to compete with Singapore, features a deep-sea port to be built by 2019 on Pulau Melaka off the coast of Melaka. There’ll also be a cruise terminal and a waterfront district with hotels and a giant observation wheel.

The harbour project built on artificial islands is being undertaken by Chinapower, a Chinese state-owned energy giant, in partnership with local KAJ Development Sdn Bhd.

It is part of China’s ambitious Belt and Road Initiative which aims to expand China’s political, economic and military clout. About 80% of Chinese oil imports pass through the Straits of Melaka.

“The strategic geography I think is an important part of this,” Hillman was quoted as saying by USA Today. “China clearly has an interest in protecting its trade routes.”

Noting that Singapore has long had a close defence relationship with the United States, which has deployed naval combat ships there since 2013, the report quotes analysts as saying China is taking the opportunity to strengthen its maritime footprint in this crucial region.

“There’s the argument that China is not getting favorable treatment from Singapore, so why not try Malaysia?” the report quoted Johan Saravanamuttu, a Malaysia expert at the S Rajaratnam School of International Studies at Nanyang Technological University in Singapore as saying.

“With the Malacca Strait on one side and the South China Sea on the other, Malaysia is quite crucial.”

However, the report noted, many in Melaka welcomed the development and tourism pouring in from China.

For instance, it quoted Eugene Lee, who runs a property management business as saying: “It’s a win-win. They’re not conquering us. China is helping neighbouring countries without any bullets and without any blood.”

Charles Cham, an artist, told USA Today people were proud that a “big country like China” was interested in developing “small-town Melaka” and that they were “not so concerned” about China’s political motives.

However, the report noted that there were also critics of the project and China’s real interest in the country, including former prime minister Dr Mahathir Mohamad.

The report noted that cautionary tales existed of Chinese-financed projects that had gone sour in other countries, such as Sri Lanka, where the US$1 billion Hambantota Port was struggling to make money while saddling the country with debt.

Ratings agency Fitch had warned in a January report that China’s initiative carried economic risks for partner countries because the main goal was to relieve overcapacity at home.

“There is a risk that projects might not be aimed at addressing the most pressing infrastructure needs and could fail to deliver expected returns,” it had said. - FMT