Malaysia scraps multi-billion dollar China-backed project

[abhay]

Malaysia scraps multi-billion dollar China-backed project
AFPJanuary 26, 2019

Incumbent Malaysian PM Mahathir Mohamad has ordered reviews of projects initiated during his predecessor Najib Razak's government. — File

A multi-billion dollar China-backed rail project in Malaysia has been scrapped, government officials said on Saturday, adding that the cost of building it was too high.
Malaysia has in recent months suspended several major projects signed under the country's previous scandal-plagued regime, in a bid to cut the country's massive one trillion ringgit ($251 billion) debt.

Economics minister Azmin Ali said Malaysia made the decision two days ago on the 81 billion ringgit ($19.6 billion) east coast rail link (ECRL) that would have connected the eastern and western coasts of the peninsula.

“The cost of the ECRL development is too big, so we have no financial ability at this time,” he told reporters.

He said that if the project was not terminated, Malaysia would have to pay an annual 500 million ringgit interest payment.
Malaysia's previous government under Prime Minister Najib Razak had warm ties with China and signed up to a string of Beijing-funded projects.
But critics say many of these deals lacked transparency, fuelling speculation they were made in exchange for help in paying off debts from a massive financial scandal involving state fund 1MDB.

The scandal was a major factor in Najib's shock electoral defeat in May last year that saw his former boss Mahathir Mohamad return to power.
Mahathir then ordered a review of mega-projects signed by Najib during his nine-year rule, adding he would discuss “unfair” terms supposedly set in these deals and high interest rates levied on Chinese loans used to finance the projects.

Azmin did not say how much compensation Malaysia would have to pay for cancelling the project, adding it would be determined by the finance ministry.
Najib and his cronies were accused of plundering billions of dollars from 1MDB, with the former leader charged with corruption over the scandal.
He will stand trial over these charges in February, and has denied any wrongdoing.

https://www.dawn.com/news/1459905/malaysia-scraps-multi-billion-dollar-china-backed-project

 

[Haristotle]

I wish we could have scrapped orange train project but it was/is too late for that. Someone in the Govt. should bring out the report about subsidies for Metro projects, an overall return on investment would show how worthy were these projects.

 

[thinking]

I wish we could have scrapped orange train project but it was/is too late for that. Someone in the Govt. should bring out the report about subsidies for Metro projects, an overall return on investment would show how worthy were these projects.

It's too late for Orange train... This project almost completed...... Malaysia only reason to cancelled this rail project because they already have big burden of debt becoz of previous corrupt Gov...Same things is happening with Pakistan...

 

[jeelu]

Lol fikar na karo cpec is still happening

 

[Aamir Ayoub]

Malaysia doesn't trust China too much

 

[miafridi]

Of course you have to scrape projects where you know that it's expenses would be less than its earnings, and any government failing to asses this is likely to put his nation into problems.

 

[shahidsaqi]

& we are ready to renting out pak

 

[ansaree]

Like any sane, living, breathing entity, Malaysia takes a U turn when necessary

 

[thinking]

Lol fikar na karo cpec is still happening

Dont relate this with CPEC...Malyasia this rail project was invidual one.CPEC will be a game changer for Pakistan and also for China..Just wait for 4 years..you will see what change come....We have curse like IPPs agreements made by Nawaz..Shareef Mafias...But can't able to cancelled them..

 

[asifA1]

However I believe in cost to profit ratio.
I firmly believe Malaysia did the right thing
because they don't have Saudi , U.A.E. assistance in $ billions of aid.
I still think Chinese investment in Pakistan are a good thing. Why?
For last 33 years we had one corrupted leader after another except Musherif
so I think the Chinese investment made up the gap for the missing in those years.

 

[Haristotle]

However I believe in cost to profit ratio.
I firmly believe Malaysia did the right thing
because they don't have Saudi , U.A.E. assistance in $ billions of aid.
I still think Chinese investment in Pakistan are a good thing. Why?
For last 33 years we had one corrupted leader after another except Musherif
so I think the Chinese investment made up the gap for the missing in those years.

Chinese investment will be great for Pakistan if;
- Investment plan is purely for the benefit of the state of Pakistan, provincial interests should play a secondary role and individual interests should be non existent.

- The investment should be transparent, contracts should be awarded after an open bidding process and fairly. A strict auditing must be done during each phase of the project, head must role if discrepancies are found in the audit.

- If China calls it "investment", then it should be investment and China has the right to spend their money through whatever channel they want under the agreement but if it is a "loan", then the money should come to state bank of Pakistan as foreign exchange, rather than it should stay in Chinese banks.

Since most of it was not being observed and may not be observed in future, I am afraid a large chunk of the money (more than 60%) will be used in kickbacks and corruption. Pakistan might benefit a little bit, but a few rich will become richer

 

[jeelu]

Dont relate this with CPEC...Malyasia this rail project was invidual one.CPEC will be a game changer for Pakistan and also for China..Just wait for 4 years..you will see what change come....We have curse like IPPs agreements made by Nawaz..Shareef Mafias...But can't able to cancelled them..

Bhai mere an indian posted this lol he means to say k any projectd with china are flawed thats why i said it