KUALA LUMPUR: China's largest state-owned company, the China Railway Group Ltd (CREC) will invest US$2 billion (RM8.13 billion) to build a Regional Centre in Bandar Malaysia.
The announcement came three months after its successful bid with its joint-venture partner Iskandar Waterfront Holdings last year to acquire 60 per cent of the equity in the Bandar Malaysia project for RM7.41 billion.
CREC said it would be consolidating all of its current regional businesses and operations once its new headquarters in Bandar Malaysia is up and running.
The company plans to build an integrated office complex as its regional hub for multinational companies from around the world.
Prime Minister Datuk Seri Najib Razak said CREC's decision to open its regional centre in Bandar Malaysia would be a major boost to the Malaysian economy.
"This is an open statement of CREC's faith and confidence in the Malaysian economy. Our fundamentals remain strong and both the World Bank and the IMF have applauded our approach in the last few months.
"We welcome investment from China which has increased enormously in the last few years. The manufacturing sector alone recorded a value of approved investments of US1.4 billion in 2014.
"Foreign Direct Investments from China and Hong Kong increased at a compounded annual growth rate of 22 per cent over the last 7 years, making it the fastest growing major source of FDI in Malaysia," said Najib at the investment announcement ceremony held by both parties, here, today.
He added that Bandar Malaysia was an integral part of the government's effort to accelerate Malaysia towards becoming a truly high-income developed economy by attracting top-notch talent from around the world.
"This strategic move to woo foreign GLCs, MNCs and major private investors to set up or relocate regional offices in Bandar Malaysia would create the demand for high-powered talent and effectively help stem Malaysia's brain drain to other countries.
"Bandar Malaysia will also serve as Malaysia's gateway to the world through the High Speed Rail to Singapore with direct links to the KLIA and Changi Airport and the proposed Pan Asean Rail Transit to Bangkok and beyond," he added.
The Ministry of Finance (MoF) holds the remaining 40 per cent stake under the Public-Private Partnership (PPP) model, with effective shareholding structure of 54 per cent by 1MDB Real Estate/MOF and KPRJ, respectively.
IWH is a PPP company with the Johor state government through Kumpulan Prasarana Rakyat Johor (KPRJ) owning 40 per cent of the company, while 60 per cent is owned by Credence Resource Sdn Bhd, a company owned by businessman Tan Sri Lim Kang Hoo.