The Melaka Gateway project is between local group KAJ Development, which will hold a 51% stake, and Powerchina International which will lead the investment, bringing in investors as well as constructing Melaka Gateway.
The project is scheduled for completion by 2025, and will cover an area of 5.52 sq. km.
Three reclaimed islands will be developed by KAJD and Powerchina for tourism, commercial, property and maritime developments.
Pulau Melaka, previously reclaimed for a failed Arab City project, is to become a maritime activities center with a container and bulk terminal, shipbuilding and ship repair services, and maritime industrial park.
It will be developed by KAJD, the provincial government of Guangdong, China and the Malacca state government through Chief Minister Incorporated.
At the signing ceremony, international trade minister Mustapa Mohamed said investment ties between Malaysia and China had risen over the past five years. “We have Chinese investments in many parts of Malaysia including infrastructure, power, railway, manufacturing, and now in tourism and services. We believe China’s participation in Malaysia’s economy will be a win-win situation.”
Chief minister Idris Haron said one-sixth of the land reclaimed by Melaka Gateway would be given back to the Malacca government.
About 2.83 sq km of land reclaimed from the fourth island will be done in partnership between CMI and KAJD, declining to reveal the breakdown of the shareholding, which is still under negotiation.
The project was launched in 2014 by Prime Minister Najib Razak.
Idris said the state might take over the abandoned Arab City project announced in 2009 on the reclaimed Pulau Melaka island, on an estimated 16,800 square meter site.
“The Arab City is a development that takes up less than four acres of land. It’s not even a city, it’s a shopping mall. In fact, we are thinking of acquiring the abandoned Arab City development … because there has been no movement for the past two and a half years,” Idris said.
Chinese companies have a stake in several large development projects including a RM 1.01 billion package for the mass rapid transit, the RM200 billion Bandar Malaysia mixed development project; and Forest City, a development on four reclaimed islands off the coast of Johor.
Chinese, Japanese and Korean investors also have an eye on the 350km high-speed railway from Kuala Lumpur to Singapore.