Dr M: ECRL May Resume, but Downsized

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The East Coast Rail Link (ECRL) project, which was suspended last July, could resume on a smaller scale if China agrees to the move.

Prime Minister Tun Dr Mahathir Mohamad admitted that both countries are still in talks on the matter and have not arrived at a good solution.

“What we are trying to do is to ensure that we will not spend much money while China will not suffer a loss,” Dr Mahathir told the Chinese-language Sin Chew Daily in a recent interview.

Malaysia is in a dilemma between continuing with the project or terminating it, with either option entailing huge financial costs, he said.

Malaysia will, therefore, seek to amend the project or other alternatives, he added.

“We are negotiating – formally or informally – with them (the Chinese). To them, this is a profitable contract, so they are reluctant to make changes,” he said.

Before the May 9 general election, Pakatan Harapan had vowed to terminate the ECRL project as it said the contract and loan terms were unfavourable to Malaysia.

“But this is not easy as we were bound by the contract and could not terminate the project easily as we have no money to pay China… We have paid a lot of money to China after the postponement,” he said.

The RM81 billion ECRL project was approved by the Cabinet under then-Premier Datuk Seri Najib Tun Razak in October 2016. The construction was to be handled by China Communication Construction Company Ltd (CCCC) while the financing was to be provided by Export-Import Bank of China (Exim Bank of China).

Malaysia would be able to secure part of the loan from Exim on the condition that CCCC builds the railway.

The 688km rail link, if built, would connect Port Klang in Selangor with Pengkalan Kubor in Kelantan and would be constructed in two phases.

Dr Mahathir said the project is a waste of money as the government would not get any returns from it and there is no way for Putrajaya to tax the concessionaire.

He also cited the West Coast railway line, which he claimed the government never made a single sen from, despite its heavy usage.

“Along the ECRL, there are fewer people and the people are mostly poor – not doing big business like the people along the West Coast railway line – so you cannot get your investment back.

“The returns from the project are close to ‘zero’ and we need to pay an RM55 billion debt,” he said.

Mahathir also denied during the interview that he is a “pro-Japan, anti-China” leader, noting that he had defended China when he attended a forum in Japan.

“They asked me of my feelings about China. I said that Malaysia is always in touch with China and we are trading partners. We are always friendly to China,” he said.

China came to Malaysia for trade centuries ago but it never colonised Malaysia, unlike the Portuguese, he said.

“So, which countries should (you) fear? China or Europe?” he asked.

“The Chinese people used to know me as their friend. Now, I am said to be not friendly to them, just because our government is reviewing the ECRL and Trans-Sabah Gas Pipeline (TSGP) projects?

“The Chinese government understands about our financial problems. It is not that we don’t want (these projects), but (these) are bad projects in the first place and we cannot afford them,” Dr Mahathir said.