- March 20, 2019
- Posted by: admin
- Category: Daily News
- Malaysia’s Prime Minister Mahathir Mohamad on 20 Mar 19 said the future of the China-backed East Coast Rail Link project, in limbo for months, was unlikely to be resolved before he visits Beijing in Apr 19 for a summit on the Belt and Road Initiative.
- The multibillion-dollar rail project – once hailed as a key part of Chinese President Xi Jinping’s signature project to fund and build infrastructure across Asia – faces the threat of cancellation after work was suspended in Jul 18.
- Mahathir’s administration, with the premier’s top confidante Daim Zainuddin at the helm, is in direct government-to-government negotiations with Beijing to drastically reduce the project’s price tag.
- According to Kuala Lumpur’s latest estimates, the true cost of the 688km line would be MYR130bn, rather than the MYR55bn touted by Mahathir’s predecessor as prime minister, Najib Razak.
- “If we continue, we will be borrowing as much as MYR60bn. To pay back, it will take us 30 years and the amount added with interest is about MYR130bn,” he said.
- Mahathir, 93, said negotiations on the rail link were unlikely to conclude before his visit to Beijing for the Apr 19 Belt and Road Forum for International Cooperation, where he will join Pakistani Prime Minister Imran Khan, Singaporean Prime Minister Lee Hsien Loong, Philippine President Rodrigo Duterte and dozens of other world leaders.
- The second summit of its kind, the forum from 25 – 27 Apr 19 will be Beijing’s biggest diplomatic event in 2019.
- Fielding questions on the controversial project in the legislature earlier, Mahathir said the rail link would be allowed to continue “on an appropriate scale”.
- In its current form, the double-track, fully electrified rail link could balloon in cost to MYR130bn, topping an MYR81bn-figure suggested by Mahathir’s Finance Minister Lim Guan Eng.
- After reassessing the project, the government felt there were some “unnecessary parts”, he said.
- “We may not have to do double-tracking, for example, because the initial projection for cargo and passengers is rather small. We can postpone parts of the construction until it is required.”
- At current levels, Malaysia would be servicing its debts for up to 30 years, the premier said. The outcome of negotiations to pare down the cost of the project would be announced when a decision was finalised, he said.
- The prime minister was also quizzed on why it was Daim, a retired finance minister, and not Lim, the current finance tsar, who was negotiating with the Chinese.
- To that, the prime minister said: “He [Daim] was chosen because of certain of his capabilities. Sometimes when we are negotiating, we need a person who will be accepted by the other parties. We face certain challenges in choosing the best person to carry out the negotiations. That is why we chose someone outside [the government] after making the evaluation as to who is the best suited and capable to discuss this with China,” he added.
External Link: https://www.themalaysianinsight.com/s/141736