Japan and China Invest Heavily in Infrastructure across the Southeast Asian Region

There has been a splurge of foreign investments across the globe by China in the recent past as its huge economy looks for resources as well as growth opportunities beyond its borders. However, when it comes to the South East Asian region, Japan seems to be slightly ahead in the investment game.  The Japanese investments that span the Southeast Asian region are spread across six countries; the Philippines, Malaysia, Singapore, Vietnam, Thailand, and Indonesia. The total value of these investments is almost $367 billion according to estimates.  China is not far behind, with investments in infrastructural projects across the region adding up to almost $255 billion.

Japanese firms have eyed Vietnam as a highly lucrative area for infrastructural investments. The Vietnamese economy has been experiencing high growth rates as it firmly establishes itself as a manufacturing hub in the region. Furthermore, it is home to a bulging middle class and presents a huge market.

Another major investment avenue for both Japan as well as China is Indonesia. Indonesia is the largest economy in the Southeast Asian region, with a high economic growth rate and a massive GDP. The large population in Indonesia is increasingly educated and tech-savvy, while the local startup landscape is vibrant and promising. Infrastructural investments in the country are seen to be extremely viable by both China and Japan.  The ambitious BRI project by China, which is based on the principle of developing infrastructure for connectivity and economic progress, includes investments across Indonesia, Malaysia, and most Southeast Asian countries.

The east coast rail project is one example of China’s high profile investments across Malaysia. Another example is that of China’s commitment to financing Duterte’s “Build, Build, Build” initiative.  In Myanmar, Chinese infrastructural investments include a deep seaport, railway projects as well as the development of special economic zones across the border.

There is a massive need for investments in infrastructural development across the region. These economies are six of the largest economies of the region. They are home to a sizeable middle class and an increasingly educated and tech-savvy population. The potential for growth is huge across the region.  The infrastructural investments by both Japan and China have the potential to benefit the region in a great number of ways. Furthermore, the investments hold financial benefits and incentives for Japan and China as well as creating a win-win situation for the region.