One Belt One Road (OBOR)

BY # SIM PEI YEE, GAN MEI SIN , KONG HOU JACK

The Belt and Road Initiative is a development strategy and framework, proposed by Chinese paramount leader Xi Jin Ping that focuses on connectivity and cooperation among countries primarily between the People's Republic of China and the rest of Eurasia. The first step is to further link Central Asian states to the Chinese economy, while the longer-distance initiatives include railway connections between China and Europe. Objective is of promoting a better economic integration between the numerous countries involved, but it is also part of a wider strategy by which the Chinese government wants to promotes the internationalization of its companies to bring them to levels of greater competitiveness in the global economy.

There are many new opportunities within China, the global, Asia countries and Malaysia. China itself can gain from the comparative advantage by exporting materials and equipment, well-developed construction and engineering capabilities as well as self-developed technology. OBOR policy creates the platform for policy, facilities, trade, financial and cultural cooperation in the world. Besides, the policy help ASEAN countries to strengthen the infrastructure and use up the available resources without waste. It allow for better trade facilitation and investment within South East Asia. East Coast Rail Line (ECRL) infrastructure project between Malaysia and China is one of the effort of OBOR. It also spurred the future trade activities through the project of the Melaka Gateway.

These were several challenges of One Belt One Road (OBOR) policy including internal challenges and external challenges. Internal challenges related with the expectation result of OBOR in the short time period, limited to debt finance, especially financing by foreign currency and the high cost of development project in the region OBOR. Whereas, the external challenges regarding conceptualisation and insufficient research which is lack of understanding to the OBOR policy, security problem which investment will be located in the most politically fraught and unsafe territory, geopolitical competitions between United States and China, legal and regulatory risk in Vietnam, and labour market risk in Malaysia.