Prime Minister Najib Abdul Razak today defended the government's decision to take an RM55 billion soft loan for the East Coast Rail Link (ECRL) from a China bank.

"The long-term loan that we received from China is on a very, very competitive basis," Najib said when attending an economic forum in Kuala Lumpur.

The government has courted controversy for awarding the project to China Communications Construction Company (CCCC).

Back in March, the Finance Ministry had said that the project had to be executed by the CCCC if it were to qualify for financing from the China Export Import Bank.

The loan, taken for 20 years, also allows for a grace period of seven years, during which the government does not need to repay the principal.

In his speech today, Najib, who will launch the ECRL project in Kuantan tomorrow, described the project as "game changer" that would boost economic growth in three states along the East Coast.

"This project will be a game changer for the East Coast states. With the project completed, Pahang, Terengganu and Kelantan will expect to achieve one percent to 1.5 percent additional growth per year," he said. 

Najib then slammed some opposition lawmakers for politicising China's investments.

"Such a myopic and narrow-minded view betrays a fundamental misunderstanding of economics, and would be bad for this country," he said.

It makes no economic sense for Malaysia to turn away Chinese FDI, as some politicians from the other side are suggesting, he added. 

"The Chinese investment in Malaysia has been increasingly politicised and blown out of proportion. We continue to welcome investment from around the world.

"We are an open, friendly and business-conducive country, which is why between 2010 and 2016, FDI into Malaysia expanded by an average of RM35 billion per annum.

"This is a strong testament to the confidence countries have in us, and it is a record we should be proud of, " he added.

"It is certainly true that China has gained prominence as a major foreign investor in Malaysia across a broad base of sectors."

Last November, Najib signed 14 memorandums of understanding totalling RM143.6 billion with China.

China is involved in several ongoing developments in Malaysia, including projects in the Iskandar Malaysia zone in Johor Baru; the RM4 billion Kuantan Port expansion projects, which will see the construction of a new deepwater terminal; and the multi-billion ringgit Forest City in Johor Baru.

Parti Pribumi Bersatu Malaysia president Muhyiddin Yassin are among those who have slammed the Chinese investments, accusing PM Najib of "opening the floodgates for the foreign power to influence local parties".

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