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Journal of Geographical Sciences >

2021 , Vol. 31 >Issue 5: 733 - 746

DOI: https://doi.org/10.1007/s11442-021-1868-2

Policy transfer and scale reconstruction of China’s overseas industrial parks: A case study of the Malaysia-China Kuantan Industrial Park

  • LIANG Yutian , 1, 3, 4 ,
  • ZENG Jiaqi 1 ,
  • KUIK Cheng-Chwee 2 ,
  • ZHOU Zhengke 1 ,
  • ZHOU Keyang 1
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  • 1. School of Geography and Planning, Sun Yat-sen University, Guangzhou 510275, China
  • 2. Center for Asian Studies, Institute of Malaysian and International Studies, National University of Malaysia, Bangi 43600, Malaysia
  • 3. China Regional Coordinated Development and Rural Construction Institute, Sun Yat-sen University, Guangzhou 510275, China
  • 4. Southern Marine Science and Engineering Guangdong Laboratory (Zhuhai), Zhuhai 519080, Guangdong, China

Liang Yutian (1982-), PhD and Associate Professor, specialized in economic geography and regional development research. E-mail:

Received date: 2020-12-15

  Accepted date: 2021-03-16

  Online published: 2021-07-25

Supported by

National Natural Science Foundation of China(41871114)

Natural Science Foundation of Guangdong, China(2018A030313293)

Strategic Priority Research Program of Chinese Academy of Sciences(XDA20010103)

Copyright

Copyright reserved © 2021. Office of Journal of Geographical Sciences All articles published represent the opinions of the authors, and do not reflect the official policy of the Chinese Medical Association or the Editorial Board, unless this is clearly specified.
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Abstract

As an innovative mode of China’s foreign direct investment, China’s overseas industrial parks are not only the main content of the Belt and Road Initiative (BRI) but also the practical carrier of policy transfer. However, most of the academic literature on the policy transfer of overseas industrial parks has regarded the host country as a passive learner and seldom considers the two-way interactions between the host country and the home country. Using the Malaysia-China Kuantan Industrial Park (MCKIP) and the “Two Countries, Twin Parks” model as case studies, we discuss the applicability and innovative development of the policy transfer theory of China’s overseas industrial parks under the background of BRI. This article systematically analyzes the developmental background of the MCKIP and the cooperative framework between the governments. We consider the problems encountered in the policy transfer process and the solutions, as well as the two-way interactions between China and Malaysia in terms of the flow of people, logistics, capital, information, and technology. The study sheds light on the construction of the “Two Countries, Twin Parks” overseas industrial park.

Key words： policy transfer; scale reconstruction; Malaysia-China Kuantan Industrial Park; “Two Countries; Twin Parks”

Cite this article

LIANG Yutian , ZENG Jiaqi , KUIK Cheng-Chwee , ZHOU Zhengke , ZHOU Keyang . Policy transfer and scale reconstruction of China’s overseas industrial parks: A case study of the Malaysia-China Kuantan Industrial Park[J]. Journal of Geographical Sciences, 2021 , 31(5) : 733 -746 . DOI: 10.1007/s11442-021-1868-2

1 Introduction

Since the 21st century, the widespread of globalization means that increasingly more countries and regions have been included in the international division of the labor system. Policy transfer gradually breaks through national boundaries and becomes an important way for policy-makers at different levels to learn from their counterparts elsewhere (Alfaro et al., 2002). As a long-standing phenomenon in public policy practice, policy transfer emphasizes the travel process between internationally-based networked actors. However, policy transfer is affected by many factors and involves multiple actors such as national governments and local governments. The issue of how to introduce appropriate policies, eliminate the negative impact, and maintain a rational view of policy formation has become a hot research topic. Furthermore, because policy transfer is a product of globalization, the process of its social space contains multi-scalar construction and reorganization. Therefore, increasingly more scholars have begun to mobilize the scale reconstruction strategy into policy transfer analysis (Fen et al., 2009; Song et al., 2018; Liu et al., 2020).
Since the inauguration of the Belt and Road Initiative (BRI) and its widespread implementation in the years which followed, the BRI has resulted in an upsurge in “going out” and serves as a practical way of promoting foreign direct investment (Liu, 2017; Lampton et al., 2020). As an innovative form of China’s foreign direct investment, China’s overseas industrial parks have become an important platform for Chinese enterprises to “go global”. They have also become important carriers for promoting bilateral trade between China and the countries along the route (Liu et al., 2018). Because the construction of an overseas industrial park must consider the differences in national politics, systems, and cultural environments between the host country and home country (Wang et al., 2020), it also involves a transnational actor-network of the host country and home country. Therefore, China’s overseas industrial parks have gradually become important carriers of policy transfer research.
With the continuous advancement of China’s overseas industrial parks, academic research on China’s overseas industrial parks has mushroomed. Relevant studies are mostly carried out based on the development process of overseas industrial parks, including summarizing the types and construction modes of overseas industrial parks from the perspective of industry positioning (Wuzhati et al., 2017), analyzing the planning characteristics of overseas industrial parks, and the interactive relationship with local cities from the perspective of park planning (Shen et al., 2020), evaluating the benefits of overseas industrial parks from the perspective of social and economic development (Meng et al., 2018; Meng et al., 2019), and discussing the problems from the perspective of development strategy and provide policy recommendations (Hong et al., 2011; Ye, 2016), etc. In the context of high-quality development of the BRI, the topic is attracting much attention as traditional foreign investment theory has difficulty explaining the phenomenon of Chinese enterprises’ foreign investment (Liang et al., 2018a; 2018b; Zhou et al., 2019). Research on China’s overseas industrial parks has also turned to theoretical research (Wuzhati et al., 2017; Song et al., 2018; Xu et al., 2019; Liu et al., 2020). Although the above studies provide important perspectives to understand the development of China’s overseas industrial parks, they have not shed much light on the applicability of two-way political transfer theory to understanding the overseas industrial parks in the context of the BRI. Since many policies related to overseas industrial parks can be regarded as the incubation and cultivation of local and overseas policies (Song et al., 2018), it is particularly important to explore the applicability and innovative development of the two-way policy transfer of China’s overseas industrial parks under the background of the BRI.
Therefore, the paper draws on a case study for Malaysia-China Kuantan Industrial Park (MCKIP) and discusses the applicability and innovative development of China’s overseas industrial parks from the policy transfer perspective. The structure of the paper is as follows. First, through literature review, we construct the policy transfer framework for overseas industrial parks from the scale reconstruction perspective. Second, we introduce the research case area and research methods of this paper. Third, based on the field investigation of the MCKIP, we explain how scale reconstruction strategy has been used to solve the problems encountered in the policy transfer process from the aspects of land acquisition, infrastructure construction, and public opinion. Finally, the conclusion summarizes the main findings and contributions in this paper.

2 Theoretical foundations of scale reconstruction and policy transfer in overseas industrial parks

2.1 Conceptualizing policy transfer

Policy transfer refers to the “process in which knowledge about policies, administrative arrangements, institutions, etc. in one time and/or place is used in the development of policies, administrative arrangements, and institutions in another time and/or place” (Dolowitz et al., 2010). Used primarily for policy reference on a national scale (Mccann et al., 2012), policy transfer has become increasingly significant as policy-makers tussle with using pertinent policy know-how and administrative measures for development in other countries (Wei, 2008). Thus, Evans and Mark (2009) have expanded the scale of policy transfers from local to regional, transnational and international scale. Policy transfer is influenced by such factors as institutional structure and political culture (Diane et al., 1999). Thus, when a particular policy is transferred from one source to another region or country, it may not achieve the desired effect (Zhang, 2014). Appropriate innovations must be made, the resources in the host country must be evaluated, etc. before effective policies can be formulated for the development of the project in the host country. In short, policy transfer is not a simple process of transmission and reception. It involves numerous actors - the national government, the local government, business enterprises, and banks - all of which have their roles to play in the policy transfer (Xiong et al., 2017). How these actors play their roles to develop appropriate and effective policies that result in substantial development have become timely issues for research.
After Singapore proposed a regionalization strategy in the 1990s, there was a surge of studies of Singapore’s overseas industrial parks. Some of these studies analyzed the factors that led to the development of the regionalization strategy while others assessed the impact of Singapore’s overseas industrial parks on such host countries as China, Indonesia, and Vietnam (Tiberghien, 2008; Meg, 2013; Chien et al., 2015; Liu et al., 2015; Meng et al., 2015; Song et al., 2018). As China continuously establishes overseas industrial parks, a similar surge of studies has been published to discuss the applicability of the Chinese experience in Africa, Southeast Asia, and other regions. Some studies have focused on the role of the overseas industrial parks in the development of the host countries and China (Andrew et al., 2006; Bräutigam et al., 2011; Miao, 2018; Song et al., 2018). Using policy transfer theory, scholars have come to realize that the construction of overseas industrial parks has a strong resonance with the localization process of policies in the host countries (Miao, 2004; Bräutigam et al., 2014; Meng et al., 2015; Tang, 2010). However, studies of policy transfer to overseas industrial parks typically have been conducted from the perspective of the home countries. With the development of the “Two Countries, Twin Parks” model, the MCKIP has become an important opportunity to promote two-way policy transfer between the home (China) and host (Malaysia) countries (Song et al., 2018).

2.2 Perspective of policy transfer in overseas industrial parks

Scale politics research originates from the scale shift of geographical research (Miao, 2004). It denotes that the “new spaces of engagement” will be constructed through “networks of associations” (Peter, 1982). Political geographers advocate “scaling as daily life” and operating scales at various levels such as cities, regions, countries, and supranational countries. With the development of scale theory, the study of scale politics has deepened and divided into two main directions. The first direction is social scale construction which focuses on the construction and reorganization of the scale itself. The other direction is to focus on the strategy and behavior of the scale practice from the perspective of actors (Ma et al., 2016). Social scale construction focuses on the scale reconstruction of a country and the political evolution such as power transfer and governance mode change in the scale reconstruction process. This is also the theoretical basis of overseas industrial parks in this paper. The latter research forms a representative theoretical framework of scale politics, the core of which is scale jumping or scale transformation. They generalize the practical form of scale politics as the use of mobility tools, means of expression, and governance policies (Liu et al., 2011).
It is worth noting that in the study of actor-scale political practice strategies and behaviors, the attention to actors and their relationships has brought the network concept into the study of scale politics. Networks in scale politics can be understood as complex relationships with the same or cross-scale connections based on a political purpose (Ma et al., 2016). China’s overseas industrial parks are the product of globalization and their social space process contains multi-scale construction and reorganization. The process of the establishment and development of a park with the participation of multiple actors also involves the profound adjustment of the relationships among the governments, the societies, and the markets (Liu et al., 2011). Applying policy transfer theory from the scale reconstruction perspective, we analyze the problems encountered in the policy transfer process of the MCKIP. We also consider the applicability of the theoretical framework of policy transfer to China’s overseas industrial parks launched as part of the BRI.
The Malaysia-China Kuantan Industrial Park (MCKIP) is a demonstration project of the BRI. The MCKIP is an intergovernmental industrial project that was initiated and promoted by the leaders of China and Malaysia. The China-Malaysia Qinzhou Park (CMQIP) and the MCKIP are the first twin parks in the world. The establishment of the twin-parks has created a new mode of international cooperation - “Two Countries, Twin Parks” - which is a result of policy transfer. The initiation and construction of the MCKIP is a process during which the Malaysian and Chinese governments, the park development companies, and the park enterprises constantly coordinate their respective interests to pursue common goals. The process involves multiple scales (countries, regions, and parks) and multiple actors (governments and parks) (Liu et al., 2020). The MCKIP has undergone a continuous process of scale reconstruction to solve the problems encountered in the policy transfer process. These problems include institutional differences in land management laws, technical learning for port development, differences in park management, conflicts of public opinion caused by cultural differences, etc. In this process, resources from governments and coordinated organizations flowed into the MCKIP, effectively solving the policy transfer problem encountered by the park (Figure 1). This has also effectively promoted the two-way interaction of the information flows, capital flows, etc. between the two countries.
Figure 1 Policy transfer framework of Malaysia-China Kuantan Industrial Park

3 The case and methods

3.1 Overview of the MCKIP

The MCKIP is a major cooperation project between the governments of China and Malaysia which was directly initiated and promoted by the leaders of the two countries. In 2011, the prime ministers of China and Malaysia reached a consensus on the establishment of a bilateral industrial park in China to further deepen bilateral economic and trade cooperation between the two countries. The following year, after the inauguration of the CMQIP, the Prime Minister of Malaysia Najib Razak proposed that China set up a “Malaysia-China Industrial Cooperation Park” which received a positive response from the then Premier Wen Jiabao. In February 2013, the MCKIP was officially launched. As the east coast of Malaysia is relatively undeveloped, the Malaysian side hoped to promote the economic development of the east coast by setting up the MCKIP near Kuantan Port on the east coast of the Malay Peninsula (Lin et al., 2018). Therefore, the MCKIP is located within the East Coast Economic Region (ECER) with a good geographical location and very convenient transportation, as it is only 10 km away from Kuantan Port and 250 km away from the capital Kuala Lumpur, as shown in Figure 2.
Figure 2 Location of the Malaysia-China Kuantan Industrial Park

3.2 History of the twin-parks

The history of the twin-parks is shown in Figure 3. The past seven years have witnessed the development of the “Two Countries, Twin Parks” model in many aspects such as cooperation mechanisms and international production capacity cooperation.
Figure 3 The history of the twin-park
The twin-park has now shifted from focusing on infrastructure investment to a new stage where both infrastructure and industrial construction receive high attention. The project has been developed in two phases. The first phase is mainly used for the development of heavy and high-tech industries, while the second phase is planned for support functions such as commercial logistics and comprehensive services. The enterprises that have settled in the MCKIP can be divided into two major categories according to the industries they are engaged in: steel and non-ferrous metals as well as machinery and equipment manufacturing. The long-term planning area of CMQIP is 55 square kilometers. In the first phase, 7.87 square kilometers have been built up. The industry project layout of CMQIP has been completed. So far, there are more than 380 registered enterprises, mainly in equipment manu-facturing, electronics, food processing, material, and information.

3.3 Research methods

The face-to-face interview method was used in data collection. In August 2019, the research team traveled to Malaysia for an in-depth investigation and to conduct interviews. The semi-structured interview method was used. First, in Kuantan, we interviewed the operations director of MCKIP and the supervisor of Guangxi Beibu Gulf Port International Group Co., Ltd. (BG Group). The interviews lasted about 2 hours. We also obtained information about the park’s construction background, the basic situation of the Chinese enterprises stationed in the park, the production and operations of the enterprises, the cooperation mode of the park, and the construction difficulties of the park. Also, we conducted in-depth interviews with the manager of Alliance Steel (M) Sdn. Bhd. regarding their product output, employment status, investment strategy, etc. The interview lasted about 1.5 hours.
The Chinese supplementary investigation was completed in August 2020. Interviews were conducted with the staff of the BG Group and the CMQIP Management Committee. The interview time lasted about 3 hours each. During the interviews with the four department heads of the BG Group, we learned about the role of the MCKIP in the construction of the BRI, the cooperative relationship between the MCKIP and the CMQIP, etc. We conducted in-depth interviews with 7 ministers of the CMQIP. The interviews covered the interactive relationship between the CMQIP and the MCKIP and how the multi-level cooperation framework of the MCKIP operates, etc.
A systematic classification method was used to sort out the survey data. After the interview, the author systematically sorted out the interview outline, interview record, field photos, the relevant paper materials provided by the interviewer, and summarized them into a book. Besides, many second-hand materials were used, including paper materials obtained from interviews, official and unofficial documents from Malaysia and China, and reliable news reports.

4 Analysis: policy transfer in MCKIP

4.1 High-level promoted policy transfer network

High ranking officials of China and Malaysia have vigorously promoted the construction of the MCKIP. After the MCKIP was officially launched, the Chinese and Malaysian governments indicated they attached great importance to the construction of the MCKIP. During his meeting with the Prime Minister of Malaysia, Chinese Premier Li Keqiang stressed repeatedly that the Chinese government would continue to support the construction and development of both the MCKIP and its twin, the CMQIP. President Xi Jinping also proposed making the two parks flagship projects of China-Malaysia investment cooperation and examples of China-ASEAN cooperation. To deepen the relationship between Malaysia and China, the Malaysian government has also vigorously promoted the construction of the MCKIP and Kuantan Port (Gao, 2013).
The successful experiences of the Suzhou Industrial Park, the China-Belarus Industrial Park, and other international industrial parks, promotion by high-ranking officials of the governments of the home and host countries is essential for smooth implementation in the early stages (Chien et al., 2015; Liu et al., 2020). The experiences of the Suzhou and the China-Belarus Industrial Parks also indicate that a multi-tiered coordination and cooperation mechanism is extremely important to guarantee the subsequent construction of overseas industrial parks.
Regarding the MCKIP, the first tier is the China-Malaysia “Two Countries, Two Industrial Parks” Joint Cooperation Council (CMTJCC), which was jointly established in 2014 by the economic and trade authorities of China and Malaysia. Since then, China and Malaysia have taken turns to hold the annual meeting of the CMTJCC. Issues related to park construction, operations, and management as well as policy support have been effectively resolved at these meetings. The CMTJCC has successfully solved, at the national level, various problems encountered in the construction of the park.
The second tier is the framework of cooperation between the local governments of the two countries consisting of representatives from the government of Guangxi Zhuang Autonomous Region, the Pahang state government, the Ministry of Commerce of China, and the Malaysian Ministry of International Trade and Industry. This cooperative framework is responsible for promoting the pre-construction work of the MCKIP at the local government level, e.g., organizing a Guangxi delegation to conduct field surveys in Malaysia (Lin et al., 2018) and appointing a Malaysian envoy to monitor the development of the park.
The park development company, funded by the Chinese and Malaysian shareholders, is the third tier of the cooperation framework. Chinese shareholders hold 49%, while Malaysian shareholders hold 51% of the company (Figure 4). The park development company is primarily responsible for land development and infrastructure. The problems encountered at this tier are resolved by changing partners. For example, the Sime Darby Group replaced Rimbunan Hijau to promote the progress of land development and the IJM replaced SP Setia to promote the infrastructure construction of Kuantan Port.
Figure 4 Shareholders of the MCKIP Joint Venture

4.2 Policy transfer issues and scale reconstruction strategies of the MCKIP

As both the Chinese and Malaysian governments have prioritized the construction of the MCKIP, a multi-tier coordination mechanism was established to promote the MCKIP’s implementation. While the multi-tier coordination mechanism provides an institutional guarantee for the construction of the MCKIP, it is inevitable that various problems still arise because of differences in systems, technology, management, culture, etc. Addressing these issues requires the integration of resources between the two governments, which involves a network of different stakeholders across different scales of governance. During the process of resource integration and benefits coordination, park development companies should use the scale reconstruction strategy which involves upscaling and downscaling (Acemoglu et al., 2006). Upscaling refers to the promotion of an event or project to a higher scale while downscaling is the opposite (Song et al., 2018).
At the institutional level, because there are differences in the land management laws of the two countries, there have been issues during the early stages of land acquisition for the industrial park. As stated by the operations director of the MCKIP:
“……In Malaysia, the land is managed by the state government, not by the federal government. During the preparatory stages, part of the land allocated to the MCKIP by the state government was wetland, which increased the land development costs. The negotiation results between the park development company and the state government were not satisfactory……” (Interview time: August 2019)
To resolve this matter, the park development company used the scale reconstruction strategy. The company strived for high-level support using the upscaling strategy. Under the coordination of the federal government, Sime Darby replaced Rimbunan Hijau as the new shareholder of the MCKIP, and the 500 acres of land held by Sime Darby effectively solved the land development issue.
At the technical level, the port development technology of the Pahang state government has introduced new problems for the development of the MCKIP. While Kuantan Port has significant development potential, it is far away from the industrial heartland of Malaysia and the Pahang state government lacks the capacity for port development and operations. Thus, Kuantan Port’s role in providing global logistics services has not been maximized. A Chinese partner, the Guangxi Beibu Gulf Port International Group Co., Ltd. (BG Group) recognizes that cooperation between the MCKIP and Kuantan Port has major competitive advantages. To further transform and upgrade Kuantan Port, the BG Group has implemented upscaling strategies, two of which are to strive for shares in Kuantan Port and the introduction of IJM. With the support of the Ministry of International Trade and Industry of Malaysia, the BG Group has been licensed to hold 40% of the Kuantan Port. As the Supervisor of the BG Group explained:
“……This is the first time Malaysia has allowed foreign investors to own 40% of the equity, which is of great advantage to us……” (Interview time: August 2019)
IJM has also replaced SP Setia as the new shareholders of the MCKIP for promoting the construction of Kuantan Port. Thanks to the joint efforts from both sides, the upgraded Kuantan Port has gradually diversified its cargo services and presently plays a significant role in providing global logistics services for the MCKIP and other local parks.
At the institutional level, the differences in the management systems of China and Malaysia have introduced problems to the policy transfer process. The ministers of the CMQIP elaborated:
“……CMQIP is managed by a party committee, the government, and enterprises. However, there is little (Malaysian) government involvement in the MCKIP. This has resulted in insufficient industrial interaction and industrial linkages between the two parks and has not highlighted the potential of international production capacity cooperation.……” (Interview time: August 2020)
These institutional differences have also resulted in the slow progress of investment promotion in the MCKIP. To remedy this issue, the BG Group has used the downscaling strategy to promote investment through international production capacity cooperation. In 2014, Guangxi Shenglong Metallurgical Co., Ltd. and BG Group jointly established a state-owned joint-stock foreign investment enterprise named the Alliance Steel (M) Sdn. Bhd. As the first project to launch in the park, Alliance Steel not only generated the demonstrative effects of international production capacity cooperation but also significantly promoted other investments in the park.
The development of the park has also been harmed by negative public opinion. Perkasa, a nongovernmental organization in Malaysia, has criticized the Malaysian government for “pawning” the dignity and rights of Malays, arguing that large-scale Chinese investment harms the Malays’ employment opportunities and erodes their rights and interests. The manager of Alliance Steel (M) Sdn. Bhd. explained that:
“……Prime Minister Mahathir Mohamad’s statement of “tearing down the Great Wall of Kuantan” has once again focused public attention on the MCKIP and the Alliance Steel Project. We need to pay extra attention to improve public opinion and relations with the media and the government.……” (Interview time: August 2020)
To solve this problem, the park has adopted upscaling and downscaling strategies. First, at the park level, companies in the park jointly responded to the “Great Wall Theory”. Besides, they set up prayer rooms for Malay employees and organized Chinese class languages as well as orientation sessions to improve cultural relations with the employees. Second, at the local government level, after the problems emerged, Qinzhou City and Kuantan City decided to launch the annual “Two Cities, Two Days” program to further enrich and improve all-round multi-level exchanges and cooperation of “Park to Park” “Port to Port” and “City to City” between Qinzhou City and Kuantan City.

4.3 Policy transfer achievement and mode innovation of the MCKIP

The application of scale reconstruction strategy has not only effectively solved various problems encountered in the policy transfer process of MCKIP but also promoted two-way interactions between the home country (China) and the host country (Malaysia) through increasing communications and cooperation between the governments at all levels. This is especially evident in the promotion of the flow of people, logistics, capital, information, and technology between the two countries (China and Malaysia) through the two parks (MCKIP and CMQIP) and the two ports (Kuantan and Qinzhou).
Unlike other overseas industrial parks where the operations and management of the parks are dominated by one side (Zhao et al., 2018), the operations and management of the MCKIP and CMQIP are based on the full integration and interaction between the two countries. This process has effectively promoted the information flows between the two countries. In terms of park planning, both China and Malaysia shared the location advantages, resource endowments, industrial foundation, infrastructure, and other information of their respective regions and jointly formulated the development plan for the “two countries, two industrial parks” systematically. To promote investment in the parks, the two parks jointly set up a group for project investment promotion by the representatives of both parties. Every year, the leading group will hold one or two large-scale joint investment promotion meetings, using exhibitions, promotion sessions, the China-Malaysia Fund Forum, the “Belt and Road” Summit Forum, and other platforms to promote the “two countries, two industrial parks” through multiple channels and from multiple dimensions, and to jointly set up a directory of Chinese enterprises. An approach of joint investment promotion in which “the Chinese side talks first, and the Malaysian side follows up” has been adopted to improve the efficiency of investment promotion (Pi et al., 2018).
To improve industrial cooperation between the two parks, China and Malaysia use RMB internationalization to actively promote the flow of capital between the two countries. On August 24, 2020, the Bank of China Guangxi Branch raised RMB 10 million yuan to the Malaysia branch through cross-border RMB interbank current account financing, thus launching the cross-border RMB interbank financing business in the financial innovation pilot program of CMQIP. The realization of this business has accelerated the innovation and development of the RMB internationalization business and is conducive to guiding market entities to use RMB for more settlement in China-ASEAN cross-border trade, investment, and financing activities.
Based on the Park-Port economic and trade interactions, China and Malaysia have taken the two ports as the windows, greatly improving the logistics efficiency of the two countries. It saves three to four days more to sail from Qinzhou Port to Kuantan Port than to Port Klang on the west coast of Malaysia. Besides, goods from countries in Europe, the Middle East, and the Indian Ocean region can also be transported to Klang Port, then transferred to Kuantan Port, and finally transported to China via Kuantan Port. Relying on its unique port benefits and its advantageous location in the center of ASEAN countries, the MCKIP will build itself into Malaysia’s eastern gateway for its opening to the outside world, and then a new platform for Malaysia-China economic and trade cooperation.

5 Conclusion

Since the 1970s, the continuous deepening of the global economic cooperation and division of labor has provided unprecedented environmental conditions for policy transfer between countries, thus making policy transfer more common. After Singapore proposed the regionalization strategy, research on overseas industrial parks began to rise. As an innovative mode of China’s foreign direct investment, China’s overseas industrial parks are not only the main content of the BRI but also the practical carrier of the theoretical framework of policy transfer. In recent years, increasingly more scholars have realized under the enlightenment of policy transfer theory that the construction process of overseas industrial parks is essentially a process of localization of foreign policies. However, these studies often regard host countries as passive learners and rarely consider the two-way interaction between the host country and the home country. To this end, this article takes MCKIP as an example and takes the “Two Countries, Twin Parks” model as the starting point to discuss the applicability and innovative development of the policy transfer theory of China’s overseas industrial parks under the background of the BRI.
The MCKIP is an inter-governmental cooperative project, which is directly initiated and personally promoted by the leaders of China and Malaysia and jointly built by the two governments. Together with the China-Malaysia Qinzhou Park (CMQIP), they have become the first twin-parks in the world, creating a new mode of international cooperation between the two countries. Based on the construction experience of the Suzhou Industrial Park, the China-Belarus Industrial Park, and other industrial parks, the MCKIP has established a cross-scale coordination mechanism. Besides, it has formed a transfer network from enterprises to localities and then to the countries. Although the high-level coordination mechanism provides an institutional guarantee for promoting the construction of the MCKIP, due to the differences in the system, technology, management, cultures, and other factors of the two countries, some problems are still inevitable in the development of the park. To solve these problems, the scale reconstruction strategy is used to ensure the sustainable development of the park. Specifically, the park strives for the support of the two governments through the upscaling strategy and finds suitable partners through the downscaling strategy. The solutions to various problems mentioned in the construction process of the park depend on both the scale reconstruction tools and the two-way interaction between the policy importing country and the exporting country. The interaction is especially embodied in the promotion of the flow of people, logistics, capital, information, and technology between the two countries through two parks and two ports.
The case of the MCKIP shows that it is appropriate to analyze the policy transfer theory in the context of the BRI, but on this basis, it is necessary to use the scale reconstruction theory to solve the problems encountered in the process of the policy transfer of China’s overseas industrial parks. The research of this paper will help enrich the scale research of policy transfer. It can also shed enlightenment on the construction of “Two Countries, Twin Parks” overseas industrial park.

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