KUALA LUMPUR (June 18): Today's official opening of Alibaba Group Holding Ltd’s first office in Southeast Asia signifies ‘a shining symbol’ of friendship between China and Malaysia, said Finance Minister Lim Guan Eng.

Lim, who officiated at the opening ceremony in Bangsar South here, said he welcomes Alibaba’s continued commitment to Malaysia and appreciates the e-commerce giant’s eagerness to work with the new Federal government to help spur new investments and create new jobs and economic opportunities for Malaysians.

“We consider this a shining symbol of China-Malaysia friendship that is based on mutual respect and benefits that augurs well for the cooperation on the part of governments, businesses and people from both countries,” he said.

Lim’s endorsement comes amid a decision to review several China-led mega infrastructure projects in Malaysia by the new government led by Prime Minister Tun Dr Mahathir Mohamad, who recently expressed his intention to revive his pro-Japan Look East Policy.

Lim, in his speech, also said that Malaysia Airports Holdings Bhd’s (MAHB) joint venture with Alibaba would boost the volume of cargo at the Kuala Lumpur International Airport.

“The collaboration between MAHB and Cainiao, the logistics arm of Alibaba, to form Cainiao — KLIA Aeropolis Sdn Bhd will increase the cargo volume at KLIA significantly. More importantly, this forms the larger strategy of making Malaysia the e-commerce and logistics hub in Southeast Asia,” he said.

MAHB's wholly-owned subsidiary MA eLogistics Sdn Bhd had in November last year formed a joint venture with Cainiao Smart Logistics Network (Hong Kong) Ltd (Cainiao HK) to develop a regional e-commerce and logistics hub called Digital Free Trade Zone (DFTZ) at the KLIA Aeropolis.

Cainiao HK owns a 70% stake in Cainiao KLIA Aeropolis while MA eLogistics owns the remaining 30%. The new company’s issued and paid up capital is RM206.67 million.

Cainiao HK is a wholly-owned subsidiary of Cainiao Smart Logistics Network (BVI) Ltd, which is in turn wholly owned by Cainiao Smart Logistics Network Ltd (Cainiao Cayman). Cainiao Cayman is an affiliate of the Alibaba Group.

Lim said the government hopes that both Alibaba’s e-commerce platform Taobao.com and Lazada will grant easy access to Malaysian small-and-medium enterprises (SMEs) to sell their products.

“Malaysians look forward to the opportunities to Malaysian SMEs following the launch of the first eWTP (Electronic World Trade Platform) outside China, which took place in Kuala Lumpur in November 2017. We are confident that the eWTP together with the DFTZ will encourage more Malaysian SMEs to participate in e-commerce and increase their exports to other countries in Asia and beyond,” he said.

Lim also said the Government will expand the uCustoms system into DFTZ to streamline Customs processes.

“This system will ease clearance through automation, and reduce the opportunity for corruption by limiting discretionary approvals. We have already implemented the system in Port Klang and we expect to expand its use in other ports in Malaysia in 2019. The uCustoms system will work hand-in-hand with the DFTZ. We have the end goal of streamlining customs processes, which are part and parcel of the DFTZ infrastructure,” he said.

“I was also informed that the lead partner for the technology consortium implementing the DFTZ platform is Fusionex, a Malaysian company. They won this contract via an open tender that was conducted by Malaysia Digital Economy Corp (MDEC),” Lim added.