China's investment in 1MDB will not compromise Malaysia's national security, assured the Chinese ambassador to Malaysia, Huang Hui Kang.

Rather, it would help Malaysia in stabilising financial volatility, resulting in a win-win situation for both countries, Huang said today at the Utar student financial aid awards ceremony in Sungai Long, Selangor.

"Whether investment and cooperation, it is all based on mutual benefit. It's all transparent and according to Malaysian law. China is not taking anything back to China. Rather, it is about helping Malaysia stabilise its financial situation and contribute to its success," he explained.

Asked if China was investing in 1MDB in exchange for Malaysia's silence on certain issues, such as South China Sea disputes regarding sovereignty, Huang rebutted the question.

"No, it has nothing to do with other issues. It's only about economic cooperation," he said.

Chinese companies won 1MDB's projects by beating companies from other countries with its own advantages in bidding, he said.

Citing Bandar Malaysia, Huang pointed out that the Malaysian government owned up 40 percent of the total shares while Malaysian private companies took up half of the rest of 60 percent.

"Secondly, Edra… China invested almost two billion dollars in Malaysia to build a very large-scale power plant to make sure Malaysia will, in future, have sufficient electricity," he said.

China is Malaysia's largest trading partner

The trade relationship between the two countries has also been beneficial, Huang said, with China being Malaysia’s largest trading partner eight years in a row. Malaysia is China’s largest trading partner in Asean.

And, after China began promoting its "One road, one belt" campaign, Huang added, more and more Chinese companies invested in Malaysia, including state-owned and private companies.

International Trade and Industry Minister II Ong Ka Chuan said that only until recent years has China ventured overseas to make investments.

"If they did not come to Malaysia, they would have gone to another counrty(and Malaysia would have lost all this investment)," Ong said.

Last December, 1MDB sold 60 percent of Bandar Malaysia's shares to IWH-CREC Consortium, a Johor-based Iskandar Waterfront Holdings and China Railway Engineering Corp joint-venture.

This March, 1MDB sold Edra to Chinese nuclear conglomerate China General Nuclear Power Corporation (CGN) at the price of RM9.8 billion.