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PM: M'sia may continue with ECRL, on a smaller scale
Published:  Jan 2, 2019 1:42 AM
Updated: 2:12 AM

The East Coast Rail Link (ECRL) project, which was suspended last July, can be continued on a smaller scale if China agrees to it, Prime Minister Dr Mahathir Mohamad said.

He 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," Mahathir told Sin Chew Daily in an interview on Monday.

Malaysia is in a dilemma between paying huge compensation once the project is formally terminated and the lack of financial capability to continue with the project, he said.

As such, Malaysia will make an amendment to the project or look for other means so that the government's expenditure will be reduced.

"We are negotiating - formally or informally - with them. 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 there were lackings in the terms of project contract and loan, according to Mahathir.

"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 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 Bank of China on the condition that CCCC builds the railway.

'ECRL a waste of money'

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

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

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

"But along the ECRL route, 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 returns back.

"The returns from the project are close to 'zero' and we need to repay an RM55 billion debt," he said.

Mahathir also denied that he is a "pro-Japan, anti-China" leader as 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 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," Mahathir said, adding that he would travel to China if it was necessary.

Mahathir also said that Putrajaya will not return the two giant pandas, given to Malaysia on May 21, 2014, earlier than the date agreed by both countries.

"No, this is a gift," he said, admitting the pandas are a meaningful symbol to the bilateral relations between China and Malaysia and that Malaysia would treat the pandas with care.

He said the cabinet has never discussed about the matter and he knew nothing about the statement made by the Water, Land and Natural Resources Minister Dr Xavier Jayakumar.

On Nov 29, 2018, Xavier said that Putrajaya would discuss with the Chinese government on the status of the Giant Panda Conservation Programme in 2019.

"The negotiations will have to be carried out with the China Wildlife Conservation Association on whether to continue keeping the giant pandas with the second cub," said Xavier, adding that the government spent RM4.65 million for the pandas in 2018.

He added that the cost of managing the pandas is expected to increase to RM7.38 million in 2019.

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