Hong Kong firms tap Malaysia's growth prospects
Hong Kong infrastructure and artificial intelligence (AI) firms are well placed to capitalise on a surge of expansion opportunities in Malaysia, but unlocking this potential will require cultural sensitivity and adapting to local market dynamics, industry insiders have said. The remarks follow the recent opening of Hong Kong’s new Economic and Trade Office in Kuala Lumpur to bolster bilateral ties, coinciding with Malaysia’s New Industrial Master Plan 2030, which aims to advance the country’s push towards high-value, sustainable and innovation-led growth.
According to Hong Kong government data, trade between the two jurisdictions was worth HK$220 billion (US$28.2 billion) in 2022, and they were each other’s ninth-largest trading partners that year. The Association of Southeast Asian Nations (Asean), which comprises the Philippines, Indonesia, Malaysia, Singapore, Brunei, Thailand, Vietnam, Cambodia, Laos, Myanmar and East Timor, continued to serve as Hong Kong’s second-largest merchandise trading partner.
Rail infrastructure opportunities
Three infrastructure-related companies told the South China Morning Post that they were actively pursuing business opportunities in Malaysia. Chang Che-son, executive chairman of railway systems consultancy Key Direction, observed that "traffic congestion and a vast geographic landscape have made Malaysia one of the most promising markets for rail infrastructure expansion in Southeast Asia, offering substantial commercial opportunities for international transit operators." He noted that Malaysia’s strategic border connections to Thailand in the north and Singapore in the south, combined with its ongoing buildout of a comprehensive railway network, yielded significant long-term commercial potential and served as a crucial gateway to the broader Southeast Asian market.
Citing his own firm as an example, he highlighted that its extensive track record with Hong Kong’s MTR Corporation allowed it to inject world-class expertise into local projects, a vital advantage in bridging regional experience gaps and establishing a competitive edge.
Robotics and AI ventures
In the technology sector, Stanley Ng, a planner and CEO of robotics firm AI Cities, highlighted significant market opportunities driven by local labour shortages and heavy reliance on imported foreign workers.
"There is immense potential for introducing robotics in Malaysia," he said. "Look at the hospitality sector; local hotels have already started deploying service robots, which shows how ready the market is for automation." Ng said his company was in discussions to introduce robotics to Malaysia, leveraging the country’s open market and strong multilingual talent pool. He added that Middle East volatility had created persistent regional logistics challenges, but AI Cities’ robotic transport projects remained on hold for now.
Ng acknowledged that local salaries in Malaysia might be lower than in Hong Kong, but he stressed that the unique experience was valuable, and he argued that an open mind and adaptability to local workplace culture were essential for long-term success.
Establish a regional hub
Yardway, a Hong Kong-based firm that makes equipment for wheel and track maintenance, established its regional hub in Malaysia during the Covid pandemic, with its chairman Alan Fong noting strategic advantages.
"The country’s common law framework, clear regulatory environment, and strategic location are decisive factors to tap into the expanding Southeast Asian market," he said. Fong said operating from Malaysia allowed the firm to deliver rapid maintenance and overhaul services to neighbouring markets, such as Singapore.
Fong cautioned that entering the Malaysian market required a significant shift in corporate culture, moving away from high-pressure management towards adapting to local workplace norms. He added that leveraging a multicultural workforce and respecting local customs had proven crucial to the firm’s success.
The Hong Kong Trade Development Council held its flagship "Think Business, Think Hong Kong" event in Malaysia earlier this month, further underscoring the deepening ties between the two markets.