While helping turn Cambodia, Laos and Myanmar into bigger destinations for exports, China's investments are transforming its smaller Southeast Asian neighbours. This is driving some of the world's fastest economic growth rates and providing Chinese companies with low-cost alternatives as they seek to move capacity out of the country.
The move is also helping Asia's largest economy and nations to what looks more and more like a new era of waning US commitment to the region from a more inward-looking administration. China is investing in everything from railroads to real estate in Cambodia, Laos and Myanmar, the frontier-market Asean economies. In Cambodia, China Minsheng Investment Group and LYP Group, headed by Senator Ly Yong Phat, signed a $1.5 billion deal last week to build a 2,000 ha city near the country’s the capital, Phnom Penh with a convention centre, hotels and golf course, it is reported. The spending equals roughly one-tenth of the country's $15.9 billion gross domestic product.
In landlocked Laos, work started last year on the China-Laos railway which will stretch 414 kms from the border to the capital Vientiane. The project, part of Chinese President Xi Jinping's One Belt, One Road initiative, will cost US$5.4 billion. Myanmar, which is liberalising its economy and adopting market reforms after a transition to democracy, is forecast by the IMF to expand 8.1 per cent this year, the fastest in the world after Iraq.