The plunging ringgit has led to problems for the LRT3 public transport rail extension project, as it is preventing bidders from bidding in it's recent open tender for rolling stock, reports Star Online.
Quoting StarBizWeek, the portal said that the trend of the weakening ringgit may have caused bidders to shy away from the tender which was to be quoted in the US dollar.
"This is because with the appreciation of the greenback, coupled with the downtrend of the ringgit, the bidders would have to fork out more for the successful completion of the tender and thus effectively eroding their profit margin," read the portal's report.
The report stated that the only party said to have submitted a bid is a consortium comprising two China-based CRCC ZhuZhou Locomotive Co Ltd and Siemens Ltd China, which partnered up with Malaysian firm Tegap Dinamik Sdn Bhd.
CRCC ZhuZhou Locomotive is a key subsidiary of China Railway Construction Corp Ltd (CRCC), which is one of the world’s largest construction companies.
CRCC made headlines earlier in Malaysia as it teamed up with Iskandar Waterfront Holdings Sdn Bhd to buy a 60% stake in 1MDB’s Bandar Malaysia for RM7.41 billion. It is also the engineering, procurement and construction (EPC) contractor for Penang’s undersea tunnel project.
The corporation is also reported to be keen in bidding for the high-speed rail (HSR) project between Singapore and Kuala Lumpur, which was recently agreed to by both the governments of Malaysia and Singapore.
MRCB George Kent Sdn Bhd, which is the Project Delivery Partner for LRT3, is apparently in a dilemma as accepting the tender means it may not get a competitive offer for the rolling stock.
But to call for a fresh round of tenders will likely cause delays for the project targeted to commence operations on Aug 31, 2020. The tender for the rolling stock has already been postponed three times prior to this.
Contacted by StarBizWeek, Prasarana Malaysia Berhad (Prasarana) managing director Azmi Aziz has declined to comment citing confidentiality and the government’s procurement policy.
MRCB George Kent currently manages the project and will be compensated with six percent of the total project cost after completion, upon which Prasarana will take over operations.
The LRT3 extension project will see 25 elevated and one underground stations added to the LRT route, and projected to benefit 74,000 commuters daily and 500,000 city dwellers along the alignment.
The rolling stock tender is to provide for six cars accessible end-to-end and able to travel at a maximum speed of 80kph with a waiting time of only two minutes, and capable of supporting 36.270 passengers per hour, per direction.