With increasing public–private partnership and international cooperation in smart city development across the Global South, Chinese firms are poised to take advantage of growing business opportunities, a situation that few studies have examined. This empirical case study of the Forest City, a Chinese-invested greenfield smart city project in Iskandar Malaysia, begins to fill that gap. This megaproject represents the coming together of overlapping economic development interests of the local authorities and the profit motivations of the Chinese investor. However, the project’s use of the ‘smart city’ discourse contrasts with the reality of limited technology adoption. Its visibility and considerable socio-economic and environmental impacts also sparked opposition from affected local stakeholders and criticism from political leaders. This prompted the Chinese investor to change business practices and enhance corporate social responsibility (CSR) efforts to mitigate risks and ensure project continuity, yet their effectiveness is limited. The study confirms the underlying tensions in the smart city discourse, where economic development and profit imperatives risk running counter to social and environmental sustainability. It also contributes to scholarly understanding of Chinese overseas investments, illustrating the host country’s agency and how better Chinese CSR practices offer the potential for risk mitigation.

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Published in Third World Quarterly.

© 2021 Global South Ltd

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This research project was partly funded by the Strategic Public Policy Research Funding Scheme from the Central Policy Unit of the Hong Kong Special Administrative Region Government, China (Project Number: S2016.A7.003), and partly by the HKUST Institute for Emerging Market Studies with support from EY (Project Number: IEMS19RG01).