Members of Barisan Nasional, the coalition in power when the deal was first signed, have hit out at changes to the plans brought in to bring down costs. They also called for the proportion of local involvement in the project to be raised from 40 to 50 per cent despite it only being 30 per cent originally.
After months of renegotiation, Malaysia’s China-backed East Coast Rail Link (ECRL) remains a hot-button issue, with opposition leaders who were in the government of ousted Prime Minister Najib Razak when the deal was first brokered questioning the new administration’s decisions regarding the megaproject.
On Thursday, Transport Minister Anthony Loke fielded a barrage of questions in parliament from opposition politicians asking for an explanation on the government’s decision to axe three of the stations that were planned for Kelantan state on the country’s east coast. They also called for the proportion of the project that local contractors can bid on to be raised from 40 to 50 percent.
“Why did you not ask the previous Barisan Nasional government why it wasn’t 50 per cent?” Loke said in response, leading to uproar in the lower house as opposition MPs demanded that he answer their questions.
Barisan Nasional was defeated in a shock election result last summer and Najib, its leader, is now facing a slew of corruption charges linked to the 1MDB global financial scandal.
In parliament, Loke insisted that despite cost cutting, there would be “no downsizing” in scope for the ECRL project, and that the realignment would benefit more areas across Malaysia.
Previously, he said, the ECRL would have served four states, whereas now it will traverse five states and one federal territory following renegotiation with Beijing. Certain stations were axed and the line shortened because they did not provide “added value”, he said, adding that these could be reintroduced at a later stage if there was sufficient demand.
Upon coming to power in May last year, the Pakatan Harapan administration set about suspending or cancelling a host of China-backed infrastructure projects, citing the high amounts of debt that had been incurred. Federal coffers were low, the new government argued, adding that the deals agreed by Najib widely seen as friendly with Beijing, were unevenly weighted.
However, the new administration led by Prime Minister Mahathir Mohamad later renegotiated the ECRL project with Beijing, successfully slashing costs by a third and increasing the proportion that local contractors can bid on from 30 to 40 percent.
Najib, a former Mahathir protégé, took to Facebook on Thursday to complain that the new government, which succeeded Barisan Nasional after the latter had enjoyed more than six decades of uninterrupted rule – was “selling the country”: a criticism the former Prime Minister frequently slung at his detractors during his time in power.
“In the past, they accused me of selling the country with the Malaysia-China Kuantan Industrial Park project which they now say is very good. And now they have given the entire ECRL to China for further development,” he wrote, adding that his coalition had envisioned more Malaysian ownership and involvement.
Initially priced at 65 billion ringgit (US$15.8 billion), the ECRL’s total cost was reduced to an estimated 44 billion ringgit following protracted negotiations. This was partly made possible by the Chinese contractor, China Communication Construction Company, which agreed to bear some of the risks involved in maintaining and operating the line when it comes into operation in 2026.
Other cost saving measures included diverting the line away from a quartz land formation, which would have been expensive to tunnel through, and shortening its length by 40km.
Analysts previously noted that the scale of concessions made by the Chinese side reflected Beijing’s desire to quash accusations that its Belt and Road Initiative to link economies into a China-centred trading network was a form of “debt trap diplomacy”.
Loke, the Transport Minister, has said that work on the ECRL may restart as early as July 25, about three months after a new agreement was reached on the project’s terms.